Regional Cities

VGP, a Belgian-based pan-European developer, manager and owner of high-quality logistics and semi-industrial real estate, has accelerated the development on the Romanian market in the last two years, adding three new locations to its portfolio – Brasov, Arad and Bucharest, as well as a new extension with 10 hectares of land for VGP Park Sibiu.

In Timisoara, the investor has ten-year presence with one of the most modern industrial parks in Western Romania. In Q3 2021 VGP finalized a new 30.000 sqm warehouse within its Timisoara development, being fully leased.

“Our recently finalized warehouse in Timisoara, a sustainable class A logistic development, hosts Casa Rusu furniture producer and two of our long term partners: RPW logistic and World Media Trans ,” said Dana Bordei, Commercial Country Manager VGP Romania.

VGP Park Timisoara is located in the north-eastern part of Timisoara and totals 155,000 sqm of class-A semi-industrial premises suitable for logistics, industrial and commercial activities. Situated at an intersection of the city’s ring road, the location has easy access to and from the motorway connecting the international airport and the city and to the E70.

Last year, VGP also started construction at a large new scheme in Brasov. VGP Park Brasov is developed on a 39-hectare plot of land, the total park being able to host up to 180.000 sqm GLA of class A logistics spaces. The investor received in August 2021 the building permit for a 28.000 sqm warehouse, the new construction going to be delivered in Q1 2022.

VGP Group has a total of 85 parks located in eleven European countries and is on a path of expansion in all its markets.

Find out more about the real estate dynamics across the regional cities of Romania: 

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Speedwell and Baltisse have sold Record Park Offices in Cluj-Napoca to Belgian AYA Properties Fund in a deal worth 35 million EUR. 

The Record Park project developed by Speedwell is the first mixed-use and urban regeneration project in Cluj-Napoca. In addition to the buildings that were the subject of the transaction, the development also includes 236 apartments.

“We are proud to close the sale of RECORD PARK Offices, as it reconfirms the value of both the entire project and the office concept we have developed. Through RECORD PARK, our goal was to recreate a neighborhood and give the community a space designed for people. As a result, we have added to the Cluj real estate market an urban hub that includes all the facilities necessary for living, with an emphasis on the well-being of the people”, said Jan Demeyere, Architect and Co-founder Speedwell.

The Record Park Offices building was completed and delivered at the end of 2020. The office space was leased to a list of tenants such as MHP Porsche, MassMutual, Yardi, PropertyShark, COS, Stradale, The Home, Artmark Dental, Mitzu Café and Royal Charis Academy Kindergarten.

Speedwell is one of the most active developers in Romania. Currently, the company’s portfolio includes Record Park in Cluj-Napoca, Triama Residence, The Ivy, Miro and SpacePlus in Bucharest, Paltim in Timisoara and Riverside City in Ramnicu-Valcea. 

Find out more about the real estate dynamics across the regional cities of Romania: 

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The figure defining the value of the IULIUS Group’s investments is 1.2 billion Euro. This is the total amount of the 300.000 sqm GLA retail portfolio in two mixed-use urban regeneration projects (Palas Iasi and Iulius Town Timisoara), the only ones of this type in the country, the national network of regional shopping malls (Iulius Mall – Iasi, Cluj -Napoca and Suceava), the national network of premium office buildings United Business Center (13 buildings, 152.000 sqm GLA) and projects under development (Palas Campus Iasi and two Family Market projects in Iasi County). 

In Timisoara, Iulius Town is the success story through which a mall turned into an ambitious mixed-use project, reviving an urban area with an industrial heritage and reconnecting it with the city. The shopping mall represents the largest retail area outside of Bucharest, with an area of 102, 000 sqm and 450 stores. United Business Center is the office component of Iulius Town, comprising of 3 class A office buildings, totalling 50.000 sqm and hosting 30 companies with 5.000 employees. 

„As real-estate concepts, we believe that mixed-use projects have shown more than ever their ability to adapt and resilience, even in contexts with many challenges and uncertainties.

Their format, strategic positioning, development on the local identity, but also the strategies implemented at the level of operation by our group (especially those of supporting tenants in the lockdown months), helped us overcome the worst period of the pandemic at a rate about 1% vacancy, 50 new brand launches and a stronger partnership with all tenants than ever before,” the company official’s state.

In the middle of Iasi, near the Palace of Culture, IULIUS developed Palas Iasi, a premiere project designed as a tribute to the symbolic building of the city and as an economic and social boost for the entire region. Inaugurated in 2012, the Palas complex remains the only urban regeneration complex of such magnitude in the North – Eastern part of the country. Currently, the value of the investment in Palas Iasi amounts to over 310 million Euro.

With a mixed portfolio that surpasses 450.000 sqm, Iulius Group represents one of the main investors in Romania’s regional cities. 

Find out more about the real estate dynamics across the regional cities of Romania: 

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Spanish-based real estate developer Gran Via, with a portfolio of over 2.000 units delivered in Bucharest, is also investing outside of Bucharest in a large residential scheme located in Constanta.

Aurel Vlaicu boulevard saw a very dynamic evolution in the last 10 years: what it used to be Constanta’s West ring road transformed in the city’s new point of interest. The largest mall in Constanta, Vivo !, a Mobexpert store or the Kaufland hypermarket were opened here. Investments of local authorities in the area have recently been announced: a sports arena with a capacity of 5,000 seats is under construction, while a new park on an area of two hectares is planned. The neighborhood is today a dynamic area that offers a modern lifestyle and a high return on real estate investments on the medium and long term.

Here, Gran Via is building a large residential scheme, that upon finalization will comprise of eight buildings with 1,000 apartments as well as numerous facilities and amenities: kindergarten, green areas, pedestrian walkways, bike paths, children’s playground and swimming pools.

Through the good connection with the city and Mamaia resort, the educational and medical facilities, Gran Via Marina is an option both for young families from Constanta who want to start a new life in a modern apartment and for those who want to buy a home for investment purposes, in a developing- area.

The developer finalized in the spring of 2021 the first phase of the compound, a building with Mediterranean architecture and large terraces. It includes 192 apartments: studios, two and three – rooms, while on the top floor there are duplex apartments. The basement accommodates the parking of the building. In the first phase, the developer has also built an outdoor swimming pool, dedicated exclusively to the residents.

Gran Via has recently started the second phase of the project, a 40 million Euro investment in 500 apartments.

Find out more about the real estate dynamics across the regional cities of Romania: 

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On a market dominated by large multinationals, as it is the case for Romanian logistics and industrial sector, two local entrepreneurs, Sacha Dragic, the founder of Superbet and Ionut Dumitrescu, the founder of Element Industrial, form a strategic alliance for the development of ELI Parks logistics network. Dragic is entering this joint venture with a new entity, D Craig Real Estate, managed by a Anca Damour, a well-known and respected real estate professional. 

Local real estate investor Ionut Dumitrescu founded in 2018 Element Industrial, with a visionary aim to create a new logistic hub in Chitila-Buftea area near Bucharest, fueled by the growing demand of modern class A warehouses and infrastructure works in the area. The first project in the portfolio of Element Industrial was ELI Park 1, a 50.000 sqm GLA class A logistics and industrial park. The project, developed in two phases was successfully sold in 2021 to Fortress, one of the largest real estate investments trusts (REITs) in South Africa.

After the exit, the next plans for Element Industrial are to focus on the development of ELI Parks logistic network, both in Bucharest and in other Romanian cities. In this context, Dumitrescu is to partner with Sacha Dragic and share a 90 million Euro cash injection to accelerate the development of ELI Parks. 

“In order to be able to expand rapidly at a national level, we needed partners. Both Anca Damour and Sacha Dragic have the necessary experience for this kind of entrepreneurial approach, in an extremely effervescent sector”, said Ionut Dumitrescu, founder of Element Industrial.

In the first phase, the new partnership between Dumitrescu and Dragic aims to build 500.000 sqm of industrial space in key areas for the development of the domestic economy, in 4 years. In the second phase, the strategy involves accelerated national expansion and interconnection – including through land acquisitions – with logistics parks in Central and Eastern Europe.

Find out more about the real estate dynamics across the regional cities of Romania: 

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Retail parks, a format favored by the social distancing period and by the sanitary restrictions, attracted numerous investments in 2021 and will continue so in 2022 as well. 

Square 7 Properties has an experience of 14 years on the Romanian market, with a strong and professional team that stands out through its services. As Country Partner for Romania of Mitiska REIM, Square 7 Properties is co-owning and managing a portfolio of 25+ retail parks. Square 7 Properties also acts as co-investor, developer and manager of all retail developments undertaken by Mitiska REIM in Romania.  

The two developers have inaugurated in Q4 2021 Baia Mare Shopping Park, a retail scheme that attracted brands such as Lidl, Altex, DM, Jysk, Kik, Numero Uno, Pepco, Sinsay, Sportisimo, Superzoo and Xpress. 

“The longstanding advantages of the shopping park proposition based on convenience, essential shopping and value for money has attracted the clients in this more convenient way of doing shopping”, says Clemens Petschnikar , CEO of Square 7 Properties.

Another project launched last year was the expansion of the retail park in Medias – “Medias Shopping” by inaugurating a new leasable area of 8.000 sqm. Thus, Medias Shopping Park reached a total commercial area of 16.400 sqm. The opening of the new project, placed on Soseaua Sibiului 75, took place on October 28 and included new brands such as Altex, Hervis, Kik, CCC, Xpress C&A, Noriel, New Yorker, Sinsay and Super Zoo. These are in addition to existing brands such as Kaufland, Deichmann, Takko, Pepco, Flanco, DM and Jysk, respectively.

In 2022, the specific investments are the extension of their shopping parks in Slatina and Tulcea and the development of another two parks in Pitesti and Giurgiu, adding to their existing portfolio an additional commercial area of 36.000 sqm. 

Find out more about the real estate dynamics across the regional cities of Romania: Download BREC REGIONAL CITIES Report 

Immofinanz is one of the most active investors in regional cities of Romania, with a total portfolio in cities outside of Bucharest of 150,000 sqm (rentable space of 4 VIVO! shopping centers outside Bucharest and 1 STOP SHOP in Botosani).  Fulga Dinu, the investor`s representative, discusses about the company`s investments in Cluj-Napoca, Constanta, Pitesti, Baia Mare & Botosani.

The investments of Immofinanz in the cities outside Bucharest comprises of the retail properties in the Romanian company portfolio, more precisely VIVO! shopping centers in Cluj-Napoca, Constanta, Pitesti and Baia Mare and STOP SHOP retail park in Botosani. Our retail segment in Romania has a book value of nearly 330 million Euro. 

The evolution of the footfall following pandemic 

We are seeing more customers returning to our VIVO! shopping centres and the footfall is recovering. Above all, the safety and health of all our visitors and employees in our shopping centers remain our top priority. We have noticed that shopping seems to be more targeted and consumers spend less time inside the centers. But, customers really miss to spend time as much as they like in the shopping centers, and little by little, they come back to their habits.

Expanding the ‘STOP SHOP’ concept 

We were always convinced of the attractiveness of our retail park assets as they are convenient local suppliers located in catchment areas of 30.000 to 150.000 people, offer a broad product range with good value for money as well as good transport links and extensive parking facilities. The pandemic once again proved the crisis-resilience of this asset class.

New concepts & trends 

We noticed 3 key trends that accelerated during the pandemic, all technology connected. First of all, the customer’s experience, by far the biggest challenge of nowadays’ retailers as they keep improving it and finding the most creative mix of online and offline activities. From this point of view, factors like the smells, sounds, and human interaction that can be found at a store are hard to replace. The second trend is speeding up the process of the purchases made by customers. As consumers spend more time online than ever before, retailers are quickly capitalizing on this trend. Thirdly, the flexibility as retailers keep looking for solutions to deliver as quickly as possible the products ordered online in order to meet increasing expectations.

Immofinanz is a commercial real estate group whose core business is the management and development of retail and office properties in selected countries in Western & Eastern Europe.

In the office sector, the international myhive brand is present in the capital cities of the core countries and the major office locations in Germany. The office portfolio represents approx. 64% of the total portfolio value. The company’s activities in the retail sector are based on the STOP SHOP brand for retail parks and VIVO! for shopping centres which are designed, above all, for secondary and tertiary cities. The retail portfolio is responsible for roughly 35% of the total portfolio value.

In Romania, Immofinanz has a portfolio of 11 office buildings (3 myhive buildings included) and 5 retail properties. 

Find out more about the real estate dynamics across the regional cities of Romania: 

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One of the leading real estate development, management and investment companies operating in CEE, AFI Europe through its local subsidiary AFI Europe Romania inaugurated AFI Brasov, in October 2020, following an investment worth 148 million Euro. A mixed-use project in the heart of Brasov city, this includes 45.000 sqm GLA of shopping center with a green terrace overlooking to the mountains and an office building totaling 15.000 sqm GLA. 

The investor is currently working on the design and permits of the second office phase, with the intention to commence construction in the soonest possible. 

“The project is perfectly located in the heart of the city and adjacent to the mall we trust the second office phase will be at least as successful as the first one,” company officials state. 

Brasov is at the start of a new development stage, considering the completion of the new international airport, scheduled for 2022, the strategic location in the center of the country and the tourism potential. 

According to the BREC analysis, Brasov has approximately 2.500 apartments under construction, over 45.000 sqm of office and logistics space under development and 3 other hotels (Radisson, Ibis, Hilton) under various stages of preparation.

AFI Europe Romania is present locally since 2005 and it is one of the largest developers on the local real estate market, operating a large portfolio of mixed-use projects. AFI is one of the players that totally redesigned landscapes, the real estate market, and communities, their developments triggering important positive economic and social changes.

Find out more about the real estate dynamics across the regional cities of Romania: 

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Total investments of over 2 billion EURO are currently undergoing or will be soon started in the 5 largest cities in the country (Timisoara, Cluj-Napoca, Brasov, Iasi and Constanta). Thus, between the end of 2021 and 2024, in the 5 cities and in the adjacent regions commercial property projects totaling over 370,000 sqm (office buildings, logistics spaces, retail parks) will be completed, as well as 7 large hotels affiliated to international brands and more than 20,000 new apartments, according to the BUCHAREST REAL ESTATE CLUB (BREC) – REGIONAL CITIES report launched today. The analysis is performed based on BREC information from companies active on the market and CBRE, Cushman & Wakefield Echinox, Simon & Partners Cluj-Napoca, IMRA Real Estate Constanta and EST Hospitality data.

The real estate dynamics across the main cities of Romania:

TIMISOARA ATTRACTS THE LARGEST VOLUME OF INVESTMENTS, NEARLY 50% OF THE TOTAL

Timisoara attracts almost 1 billion euros in investments, approximately half of the total regional investments, in office, retail and logistics projects of over 190,000 square meters, a 5-star Radisson Blu hotel and over 5,000 apartments that will be delivered by 2024, according to the BREC analysis. Of the 5 regions analyzed, Timis attracts the largest real estate investments due to the excellent connection with the pan-European corridors, the area having already been established as a strategic location for production facilities. Iulius Group is working here on one of the most important office projects, UBC 0, with 30,000 sqm and AFI Europe added AFI Park Timisoara project to its portfolio last year. At the same time, large investors in logistics such as CTP, WDP, VGP and Global Vision are present with ongoing projects of over 115,000 sqm.

IASI: + 65,000 SQM OFFICES AND RETAIL AND +5,000 NEW APARTMENTS

Iasi accumulates investments in office and retail projects of over 65,000 sqm and over 5,000 apartments in various compounds that will be completed by 2024. Iulius Group is working here on one of the largest investments in the country on the office segment, respectively 60,000 sqm at Palas Campus, but also the Family Market retail parks in Miroslava and Bucium, a total investment of 17 million euros. In the context of a high presence of foreign companies in this region, COS, the leader of the office fit-out market (design and arrangement for interior spaces), recently opened a new representative office in Iasi. COS also has regional offices in Timisoara and Cluj-Napoca (also operating the Stables co-working space here) and recently attracted the Sarmis investment fund to shareholders, continuing the regional expansion. The large real estate developers in logistics are still absent in Iasi, but two recent public investments – the industrial parks Iasi Industrial Park and Miroslava Industrial Park – have catered for the demand on this segment.

BRASOV: A NEW DEVELOPMENT STAGE

Brasov is at the start of a new development stage, considering the completion of the new international airport, scheduled for 2022, the strategic location in the center of the country and the tourism potential. According to the BREC analysis, Brasov has approximately 2,500 apartments under construction, over 45,000 sqm of office and logistics space under development and 3 other hotels (Radisson, Ibis, Hilton) under various stages of preparation. One of the largest investors in the area is AFI Europe, which last year completed an EUR 148 million investment in the AFI Brasov mixed-use project and will begin construction of the second office building in the project (10,000 sqm) in next period.

CLUJ – NAPOCA: 3 NEW LARGE HOTELS AND +5,000 NEW APARTMENTS

After a period in which Cluj-Napoca attracted the largest volume of investments in offices after Bucharest, the city and the surrounding areas attract over 20,000 square meters of new logistics spaces, 3 new hotels (including a Radisson hotel and a hotel under the Courtyard by Marriott brand) and over 5,000 apartments in projects already started or which will start in the next period, with completion deadlines between 2022-2024. One of the major investors in Cluj is Immofinanz, which owns the Vivo! Shopping center here, with an area of ​​over 60,000 sqm. After recently investing EUR 22 million in the modernization of this center, the Austrian investor will soon complete the modernization of a new 10,000 sqm area at the Vivo! center Baia Mare.

CONSTANTA: INVESTORS BET ON LOGISTICS & RESIDENTIAL. NO MAJOR OFFICE PROJECT YET

So far, Constanta has attracted investments mainly in the retail and logistics segments, while in recent years it is the target of residential investors, both in the city and in the seaside resorts, for holiday apartments. More than 7,000 apartments are currently under construction or will be launched in the next period, including an investment of EUR 40 million in the second phase of the Gran Via Marina project of the Spanish developer Gran Via, which will complete 500 of new apartments until 2024. The region has high potential for logistics, due to its location and available transport infrastructure. Also, the city could attract in the near future at least a major investment on the office segment, given that no iconic building has been developed up to present.

NEW CITIES AND TRENDS ON ROMANIA REAL ESTATE MAP 

New investments in retail parks, a format favored by the social distancing period and by the sanitary restrictions. New cities on the map. Investors Square 7 & Mitiska have recently completed 2 such projects in Baia Mare and Medias, further preparing the expansion of the park in Slatina and a new investment in Giurgiu (20,000 sqm). Also, Iulius group is working on 2 new retail parks under the Family Market brand in the Iasi area (Bucium neighborhood and Miroslava commune), with a total area of ​​9,200 sqm. Other new investments of this type are expected in the market, considering the need still insufficiently covered on this segment in the secondary and tertiary cities in the country.

Logistics, one of the most active real estate segments in the last 2 years, attracts investments in new regions. Element Industrial is developing 500,000 sqm in cities such as Braila (EUR 25 million), Ploiesti or Pitesti. Element Group relies on both large formats and the ELI Xpress format – proximity logistics, inside cities. Also, as the pandemic highlighted the underdeveloped infrastructure for the medical sector, new logistics formats or other medical destination buildings may enter the real estate investors` radar in the next period.

Real estate investments across the country have also drawn the regional expansion of other players in related sectors, such as the fit-out market, facility management, construction and architectural materials / systems, etc. Alukönigstahl Romania, the local subsidiary of the European leader on the market of aluminum, PVC and steel systems, signed in the first 9 months of 2021 contracts worth 17 million euros, with over 60% of the projects on the residential segment, THETA Furniture & More –  interior design solutions integrator is expected to complete a new furniture factory (4 million EUR investment) near Bucharest in Q1 2022, EFMS (Romanian entrepreneurial facility management company) has expanded nationwide, reaching EUR 6.6 million turnover in 2020 and Reynaers Aluminum, a systems for facades and doors supplier, inaugurated 3 new showrooms in Cluj-Napoca, Iasi and Timisoara this year.

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Speedwell launched sales for the first residential building of the PALTIM project, offering 123 apartments out of a total of 236. PALTIM is a mixed-use compound featuring residential, office and retail components.

Developed on the old premises of the hat factory with the same name, PALTIM is an urban regeneration project that will give back the city’s residents an important historical spot. The unique location near the Bega River, together with the state-of-the-art design and high-quality materials contribute to creating a one-of-a-kind neighborhood.

In close proximity to one of the biggest parks of Timisoara, Central Park and within walking distance from the city center, PALTIM offers easy access to many points of interest in the city and outside of it. Furthermore, the ensemble features various functions, such as residential with two buildings and a total of 236 apartments and an office one, completed by retail spaces. Speedwell will also preserve the historical and cultural heritage of the location by refurbishing a monument villa and a section of the former hat factory. The villa will host office spaces and a restaurant, while the second building will be transformed into a café.

„We are excited to launch PALTIM. This is a special project for us since it’s the first one we are developing in Timisoara. The historical location also adds to its value. Through PALTIM, we aim to bring back a part of this place’s history by creating a neighborhood where a community can grow and also contribute to this area’s development,”  states Didier Balcaen, CEO and Co-Founder at Speedwell.

Phase 1 of the project will include a residential building with a height regime of P+6+7R and 123 apartments, from studios to 2, 3, and 4-room apartments. The residential units are estimated to be delivered in March of 2024.

PALTIM will be built with high sustainable standards, aiming to obtain the BREEAM Excellent rating for the office component and complying with the nZEB standard, by using superior quality materials for thermal insulation, as well as renewable energy systems. Sustainability and high building standards are a common theme for all Speedwell developments.

Read more about Speedwell >>

3.11.2021