August 06, 2014

Romania witnesses substantial increase in investment transactions in H1 2014

Romania witnesses substantial increase in investment transactions in H1 2014

Investment volume for Romania in H1 2014 up 222 percent y-o-y, with an increased diversity in terms of type and use of the properties sold, as well as profile of buyers, according to the latest research on capital markets from CBRE

The investment volume for H1 2014 was of €402.4 million for a transacted surface exceeding 692,000 sqm. This represents an increase of 222 percent versus H1 2013 and 17 percent over full volume for 2013. A total of 15 transactions were recorded, highest number since 2008, with an average volume size of €26.8 million, similar to last year.

The profile of the transactions was quite diverse in terms of use (office segment leading with 58 percent of total volume), in terms of type of properties (prime properties generating 55 percent of total volume), in terms of buyer typology (developers and institutional funds the most active, out of which Globalworth generating 54 percent of volume). The type of properties transacted is quite diverse, ranging from prime properties (like Charles de Gaulle Plaza), to secondary properties (like Auchan Pitesti Gavana) and distressed properties (Pic Pitesti and Pic Oradea).

On the back of increased investor interest, prime yield for the office segment compressed at 8 percent. Other prime yields are stable. In terms of prime rents, CBRE points out that they are relatively stable: €60/sqm/month for shopping centres, €18/sqm/month for offices and €3.8/sqm/month for industrial.

Razvan Iorgu, Managing Director CBRE Romania, commented: “This increase in volume of investment deals comes on the back of increased investor interest in prime products, especially office and retail located in Bucharest. With attractive returns, a growing economy and demand from tenants steadily increasing q-o-q there are sufficient arguments for other major investment transactions to finalise in the next 6 – 9 months.”

He continued: “In respect to land transactions, we have observed also a rise in terms of number, volume value and type of properties sold. We have identified three major categories of buyers of land properties: retailers (mainly Lidl, Dedeman, Kaufland, Leroy Merlin) looking to buy properties in prime and secondary cities, industrial occupiers interested in plots of land for the development of factories (Dr. Oetker, Best Food, Continental) and real-estate developers securing prime properties in major cities for future landmark developments (NEPI, Globalworth and Kiseleff Development).”

marcus evans Summits
IntraLog Poland
Private Equity
New Work 1
Cities of Tomorrow