Redevelopment in Prague 8 is expected to attract significant investment which in turn could boost the city's real estate market and create some lucrative opportunities for investors.

The districts of Karlin and Holesovice, which have been neglected for some time following devastating floods in 2002, are benefiting from creative regeneration, with modern parks, stylish offices and innovative residential buildings all being built.

Redevelopers also plan to dig two canals in Prague 8 in order to restore two former islands as part of a planned restoration of infrastructure in the area.

Pavel Klega, Prague's deputy mayor, told Radio Prague that the new developments form part of a broader programme designed to bring development to the area.

He said there will be "quite a bit" of new of housing being constructed in the Prague 8 district that will make the area "a significant new urban centre".

Prague has been a popular place for savvy property investors for some time now, with demand from both foreign and local buyers remaining high.

The strength of the Czech economy has proved to be a big attraction, as has the huge growth in tourism in the city over recent years.

However, some areas have outperformed others when it comes to property investment, with places like Karlin and Holesovice being left behind.

But with redevelopment now taking place investment is soon expected to flow into these areas and property buying patterns could soon shift as a result. For investors this means strong capital returns could soon be up for grabs.