Residential sector: as competition sharpens, quality increases

Residential sector: as competition sharpens, quality increases 1754 1241 Bucharest Real Estate Club

Residential sector: as competition sharpens, quality increases

While investors agree the commercial segment of the Romanian real estate market has matured, with numerous qualitative developments delivered in the last couple of years, BREC takes a look at the residential segment where new, interesting moves take shape.
The general old, outdated stock of residential developments in Romania, built mainly before the 1990s, that have become inappropriate for living to the young urban, dynamic generation combined with the country`s general positive macroeconomics are the main drivers of the residential development. The Capital’s city poor public transportation infrastructure drives workforce to buy homes closer to their workspaces.

“In the last couple of years we can notice a bigger involvement of developers in the design stage. Their experiences have probably shown that a project not thoroughly designed has small chances to go well. Also, the increasing competition on the market is probably the single benefit of the intense residential demand”, Adrian Untaru, co-founder of architectural firm ADNBA told BREC.

If during 2014-2016 (the first years of market’s return) we could notice only a few qualitative projects and those were addressed mainly to the luxury niche, now there are more and more developments announced, which impress through architecture, interior design and facilities for residents and target the upper-premium segment.

The transaction prices in Bucharest are now at a level of 1,500 – 2,000 EUR/ built sq. m, excluding VAT on the upper-premium segment, while the luxury units are traded for prices ranging between 2,000 – 2,500 EUR/built sq. m, plus VAT.

FROM RETAIL TO RESIDENTIAL

Prime Kapital (the company founded by Martin Slabbert and Victor Semionov, known in the market for the development of NEPI) has recently announced an ambitious project, in the proximity of Barbu Vacarescu office hub: Avalon Estate. The new development will span over 8.1 hectares, with 3 major categories of units and facilities such as a Club house and lake access, 1.3 ha of park with play areas for children, 24-7 security and car-free alleys ensuring safety of the community within a well-designed urban concept. Avalon will be delivered in two phases: in 2021 and 2024.

The project offers many valuable benefits – privacy, security, low density and low traffic volumes. It also features an opportunity to establish new roots in private village-type setting that offers a mix of housing types that minimize repetitive form from a design point of view,” said Maggie Kitshoff, Residential Projects Director for Prime Kapital.

TIRIAC COMES BACK IN RESIDENTIAL

The real estate arm of the group owned by local businessman Ion Tiriac announced plans to resume residential projects. The company previously delivered Stejarii luxury compound in Baneasa and Residenz in Chitila. The company’s newest ambition is an urban regeneration project on a former industrial plot (IFMA) neighboring the North Railway station.

The architectural concept of Outbox Studio proposed numerous residential units from towers up to 80m height to low height buildings with terraces homes, vertical gardens and rooftop swimming pools. The project will address the corporate tenants of the recently created Center-West office sub-market. The company also plans residential developments in secondary cities such as Timisoara and Brasov.

ONE UNITED PROPERTIES, THE MOVERS & SHAKERS IN PREMIUM SEGMENT

The company co-founded by Andrei Diaconescu and Victor Capitanu is today one of the most active real estate developers, in the exclusive Central-North area of Bucharest.

One United Properties has finalized 376 apartments until 2018 and has another 453 units planed for construction.

The flagship project of the company is One Floreasca City, a mixed development with a class A office building – One Tower- and 3 exclusive blocks of design apartments – One Mircea Eliade. Within the same development, Auchan Romania will restore and modernize the former Ford factory in a contemporary retail space.

Other future projects include One Herastrau Towers (at the junction of Nicolae Caramfil and Aviator Alexandru Serbanescu) and One Verdi Park (on Barbu Vacarescu, near Verdi park).

BRISTISH-BASED LORECO CREATES NEW COMMUNITY IN THE NORTH OUTSKIRTS

British-based Loreco Investments envisioned a villa community in a quiet and green area from Balotesti, in the North outskirts of Bucharest. The design and urbanism phase spanned over two years, comprising the land and green spaces’ allotment, infrastructure, playground and other amenities in the park. Dumbrava Vlasiei is to be developed on a 90-hectare plot as a five “urban villages” interconnected by a green corridor.

The developer puts up for sale a diversified mix, from pre-fabricated Huf Haus models to villas designed by Romanian architects offering unicity, but also respecting the major urbanism plan of the entire community. The developer has invested 50 million EUR up to now in Dumbrava Vlasiei, his plan being to reach 1,000 units.

FIRST LOFT APPARTMENTS IN BUCHAREST

After its first residential compound on the local market developed in the South area of the Capital (The Park), Lithuanian-based Hanner now addresses a new development on the former Grivita brewery plant, in what seems to be Bucharest’s next real estate hub: the area neighboring Basarab overpass. The development will bring a new product on the Romanian residential market: 31 unique lofts to be built on the structure of one of the former historic building – Maltarie.

A true (hard) loft is a conversion of a vintage factory or warehouse. They have a harder edge as they are usually constructed of concrete or “mill” construction of exposed brick, original wood posts, beams and floors”, the company’s representative stated.

FROM OFFICE TO RESIDENTIAL

After they have build a brand as an office developer, local developer Forte Partners has announced project on the residential sector. The company has finalized last year a boutique project, Londra 27, and is now building the first phase of Aviatiei Park, a condominium addressing the upper-premium segment of the market.

Located in the north of the capital, in an urban fabric which concentrates a variety of new technological activities, the project responds to a young public necessities of finding a place to call home near their professional area. The apartments diversity, the elegance of common spaces and green plazas define an elaborate and welcoming residential complex which complements the identity of Aviatiei neighborhood” the company’s official stated.

 “We hope for a quality increase of the new residential developments. And we do not refer here to a more expensive finishing, which doesn’t necessarily lead to a different way of living. We hope for an education of consumption towards the quality of the living space, towards a building in which we enjoy staying as well as we enjoy looking at it. Homes are, for most of us, the most important investment during lifetime. The way these homes pass the time test directly influences the investment. This can go up or down, according to the overall quality of the entire project. And in the last couple of years we have noticed many examples in both cases, enough to help this economic education we need so badly”, Adrian Untaru of ADNBA concludes.

With such developments under way and other also under designing phase, we can say the residential segment is taking the right steps towards maturity, bringing a new qualitative stock on the market in the following two to five years.

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