Why Latvia? Unlocking Opportunities in a Dynamic Baltic Market
With record levels of foreign direct investment and a growing pipeline of international developers, Latvia is quickly emerging as one of the most dynamic real estate markets in Northern Europe. At the forefront of this growth is the Investment and Development Agency of Latvia (LIAA), which provides full-cycle support to investors — from site selection and permitting to long-term partnership building.
The Baltic real estate market is evolving fast — and Latvia is at the heart of this transformation. While the country’s real estate sector has traditionally grown at a slower pace than its Baltic neighbours, today that dynamic is changing. Latvia combines competitive prices, strong demand, and a wave of international developer interest, making it one of the most exciting investment destinations in Northern Europe.
“Latvia is currently working with a portfolio of investment projects exceeding €15 billion, spanning sectors from energy and biotechnology to green innovations and real estate. Our goal is to provide strategic support that enables international developers to integrate into Latvia’s dynamic economy and unlock long-term value. With competitive incentives, streamlined permitting, and a commitment to sustainability, Latvia is ready to welcome the next wave of visionary investors,” Ieva Jāgere, Director General, Investment and Development Agency of Latvia.
Competitive advantages
Latvia’s real estate market remains more affordable than those of neighbouring Estonia and Lithuania. At the same time, the country’s households have significant untapped borrowing capacity. Housing loans in Latvia account for only 12% of GDP, compared to the eurozone average of 36%. This means that the growth potential for residential demand is substantial.
For businesses, Latvia’s tax regime is highly competitive. Corporate income tax is not paid while profits are reinvested, only upon dividend distribution. This has helped Latvia achieve #2 ranking among OECD countries in the International Tax Competitiveness Index 2024.
And beyond numbers, Latvia’s quality of life is a unique advantage: Riga combines a safe, business-friendly urban environment with quick access to nature, beaches, and green spaces — all just minutes from the city centre.
Success stories
Latvia is already home to several landmark international real estate projects:
- SĀGA Lifestyle Shopping Center – A Canadian-backed development by VPH, adjacent to IKEA in Riga. The project has quickly become a hub for retail and community life.
- Waterfront Riga – The largest development project in the Baltics, led by UAE-based Eagle Hills Properties. With €3 billion in planned investments, 55 hectares of Daugava riverfront will be transformed into a vibrant district of over 6,000 apartments, retail, hotels, and office space.
- Linstow (Sweden) – Long-term investor behind Origo, Alfa, and multiple office developments, showing the stability of Nordic capital in Riga.
These projects demonstrate not only international confidence in Latvia but also the wide range of opportunities available — from retail to residential, offices, and large-scale mixed-use districts.
Baltic context: momentum is shifting
For years, Tallinn and Vilnius led the region in real estate development. However, in 2024 Riga overtook Tallinn in the number of new residential units sold. This turning point suggests that demand in Latvia is accelerating, and developers who enter now will benefit from first-mover advantages in a growing market.
Sustainability and innovation
The next wave of opportunities will be shaped by ESG and smart city trends. Investors are increasingly seeking BREEAM- and LEED-certified projects, energy-efficient buildings, and sustainable construction. Latvia already ranks #3 in Europe for renewable energy consumption and generates 73% of its electricity from renewable sources (compared to 47% EU average).
Infrastructure development is also a game-changer. Rail Baltica, Europe’s largest ongoing infrastructure project in the Baltics, will create a high-speed rail link from Riga to Tallinn, Vilnius, and Warsaw, dramatically improving logistics and connectivity while aligning with EU Green Deal objectives.
Discover your next success story
Latvia is a market of potential that is only beginning to unfold. With competitive tax incentives, high renewable energy adoption, and flagship projects reshaping the landscape, now is the right time to explore opportunities. LIAA offers full-cycle support: site selection, regulatory guidance, HR insights, incentives, and integration into Latvia’s innovation ecosystem.
Learn more at liaa.gov.lv and business.gov.lv and discover how Latvia can become your next success story.
About the Latvian Investment and Development Agency (LIAA): LIAA promotes the competitiveness of Latvian entrepreneurs, export growth, and investment attraction, as well as develops the tourism industry and implements the country’s image policy. The agency acts as a state partner in business development – from idea to international markets. With an extensive network of representative offices abroad and regional business centres in Latvia, LIAA helps companies grow and positions Latvia as a safe, innovative, and open country in the global economy.
