In the Spotlight

In the Spotlight

Members’ news: Colliers sells the office portfolio of East Balkan Properties
Members’ news: Colliers sells the office portfolio of East Balkan Properties 2880 1920 BUCHAREST REAL ESTATE CLUB

Members’ news: Colliers sells the office

portfolio of East Balkan Properties

The real estate consultancy company Colliers International Romania advised East Balkan Properties plc in the selling of its office portfolio consisting of four buildings with a total area of 9,047 sqm, situated in strategic locations in the capital. The aquisition was made by Adam Europe.

 “The real estate investment market was characterized in the first half of this year by a very high diversity: properties with medium and very large premises, located in Bucharest and in regional cities, from different real estate sectors. This variety is very healthy for the market and marks the maturity of the portfolio of products available for sale”, Narcisa Stănimir, Senior Associate Investment Services at Colliers International Romania, said.

The portfolio includes four office buildings with a total area of 9,047 sqm, placed from the north of Bucharest to its center.

Airport Smart Offices is in the immediate vicinity of Henri Coanda Airport, Domenii Offices is located in the northwest area – near the Exhibition Area, Jules Michelet Office Building is near the center of Bucharest, in the historical part of the Romana Square, and Casa Mosilor Office Building is located between Universitate and Unirii Square, close to the cultural and academic institutions of the capital.

The positioning in these prominent areas, which also enjoy good connectivity to public transport, has favored a high occupancy rate, with a presence in these buildings of companies from various sectors of activity: marketing and advertising (e.g. McCann Erikson, Mercury Research), IT (e.g. Meti Logiciels et Services, Elkotech, Essensys Software), logistics (e.g. Militzer & Munch), construction (e.g. Martifer) and services.

East Balkan Properties plc is a private property company based on the Isle of Man and is invested in Romania, Bulgaria, Slovakia and Serbia. Adam Europe is coordinated by Isaac Cohen Hoshen.

EBP owns primarily logistics assets and industrial land. The office portfolio was purchased in 2006 and 2007 and managed since the acquisition by the asset and property management company Equest Investments SRL.

Adam Europe, a vertically integrated real estate investor and developer, under the coordination of Isaac Cohen Hoshen, acquired Phoenix Tower and Construdava Business Center in 2016, respectively 2017, announcing in this way the re-entering of the group on the Romanian market, which is under the extension of its portfolio of office buildings, but also the development of new residential projects, such as Reveria Palady 43 of Eastern Bucharest.

This year, the office segment will be the main attraction of the real estate investment market in Romania. Products are available, so, by end-2019, yield compression could happen quickly and the investment volume on the office sector could reach EUR 1 bn.

(23.08.2018)

Re-imagining office lobby
Re-imagining office lobby 2500 1407 BUCHAREST REAL ESTATE CLUB

Re-imagining office lobby

In a more and more crowded office market, with new hubs developing at fast pace, real estate investors are coming with new concepts, re-thinking the use of different functions, such as the office lobby.

According to “Innovation Spaces: The New Design of Work” study, the ground-floor of the office buildings is transforming “into community magnets that creatively draw like and unlike people together”. The study argues that the coffee shop on the ground floor is the easiest approach. “In other cases, the infusion of free, fast and pervasive wireless technology combined with more lounge-like spaces has transformed ground floors into working hubs”

WHAT CHANGES DO WE SEE ON THE LOCAL MARKET?

Globalworth has recently organized the first augmented art gallery, with video mapping animations in the lobby of its landmark building in Barbu Vacarescu, Globalworth Tower. The Human Extension by Victor Fota is part of the Art & Tech District, a cultural initiative founded by Globalworth in partnership with One Night Gallery that aims to promote the young generation of Romanian artists through emerging technologies and involve the community in the process. The company constantly uses the lobby and public spaces of its buildings to organize creative events such as art shows, street food caravans and other activations on different occasions.

SKANSKA IS ENVISIONING A LOBBY LIKE A SWEDISH SUMMER HOUSE

With the goal to redefine a vital part of every office building, by changing the lobby’s function from a transit area to a welcoming space, Skanska has collaborated with Danish architectural studio, Henning Larsen, to create a space with the feel of a Swedish summer house. The new lobby concept supports health and well-being in the workplace. The inspiration is Sommarstuga – the traditional Swedish summer house.

The new Skanska lobby concept can be easily rearranged to match the specifics of each and every futureproof office building in the company’s portfolio. In the same time, there are components that are common to every Sommarstuga inspired lobby. The design is based on several key elements: warm and comfortable light, natural materials, diverse spaces to meet and rest, and openness to the local communities.

IMMOFINANZ HAS IMPLEMENTED MYHIVE CONCEPT ON BUCHAREST MARKET

Austrian real estate investor has introduced its international office brand myhive in five of its office properties from Bucharest. The office brand stands for the friendly and lively atmosphere experienced in a hotel, combined with optimal infrastructure and services. The buildings are characterized by an inviting and lively atmosphere, attentive and helpful staff, easy accessibility and numerous services: shops and services for everyday needs, flexible and serviced offices, fast W-LAN in the common areas and a sport offering.

With acknowledged developers implementing their international concepts on the local market and new co-working brands such as Spaces or Mindspace to launch in the following period, it is a clear sign for institutional foreign investors that Bucharest is a strong market and offers high-returns.

(23.08.2018)

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Members’ news: Element Development launches industrial division
Members’ news: Element Development launches industrial division 1441 1080 BUCHAREST REAL ESTATE CLUB

Members’ news: Element Development launches

industrial division

Ionuț Dumitrescu launches Element Industrial, a real estate development company focusing on logistic projects. The new company will develop a portfolio of industrial projects in Bucharest and Romania. The first is ELI PARK 1, to be built in two phases on a 10-hectare plot, on DN 7, in the North outskirts of Bucharest, Chitila area.

 “Element Industrial will develop class A logistic parks, strategically located. We have taken the decision to start this business on the premises of an increasing consumption determining the significant development of both e-commerce segment and FMCG companies”, said Muler Onofrei, Managing Partner within Element Industrial.

25 MILLION EUR INVESTMENT IN A 45,000 SQ. M INDUSTRIAL PROJECT, NORTH OF BUCHAREST

ELI PARK 1 will total a 45,000 sq. m. lettable area of warehousing spaces and offices. The first phase of 20,000 sq. m will be delivered in the second quarter of 2019. ELI PARK 1 is conveniently located 4 km from the Capital’s City Ring Road, by DN7, a four-lane national road. The main benefits are the ease of access towards North and Central Bucharest as well as the immediate vicinity of Chitila/ Buftea, an area with significant labor availability, unlike other classical logistic areas with such problems, A1 – km 14 or 23.

Muler Onofrei is one of the most experienced real estate industrial managers, with a presence of 16 years on the local market. Muler has coordinated the Industrial department within Eurisko and was the director of Romanian branches for developers such as ProLogis, Soravia or Panattoni. He holds a RICS degree in “Portfolio Management”, as well as an MBA from Kellogg School of Management, Northwestern University. Within Element Industrial, Muler occupies the position of Managing Partner, with an active role in the company’s management.

The new project will be designed and executed following strictly class A international standards, with characteristics such as 11.5 m clear height, one loading bay for each 800 sq. m. of warehouse, generous 35 mtrs truck court and numerous parking places. The minimum leasing surface is 2,500 sq. m.

Element Industrial was established by Ionut Dumitrescu, a Romanian businessman with a solid expertise on the local real estate market. Between 1997-2007 he developed consultancy company Eurisko, which was sold in February 2008 to CB Richard Ellis, the real estate worldwide leader. Following this deal, he focused on real estate development: the first project was HQ Victoriei, a class A business center near Victoriei Sq, sold in 2012 to Zeus Capital. Begining with 2017, Dumitrescu partnered with the founders of One United to establish a new office division, One Office.

(23.08.2018)

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 Partner 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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Members’ news: CA Immo buys first phase of Campus business park
Members’ news: CA Immo buys first phase of Campus business park 1745 1440 BUCHAREST REAL ESTATE CLUB

Members’ news: CA Immo buys

first phase of Campus business park

CA Immo has acquired the first phase of Campus, the business park developed by Skanska in Center West Bucharest.  The transaction volume is around 53 million EUR. Campus 6.1 is an A-class office development, offering 22,000 sqm GLA. Completion is scheduled for Q3 2018; full occupancy of the building is expected by the end of the year.

 “Having acquired Millennium Towers in Budapest in 2016 and Spire Building B in Warsaw in 2017, we continue to pursue our target of continuous development and expansion of our CEE core market portfolios with the purchase of Campus 6.1 in Bucharest. The multi-tenant property is very well located and will be nearly fully let by takeover, clearly supporting our overall financial goals”, said Andreas Quint, CEO of CA Immo.

Campus 6.1 is the first phase of a four-building office complex Campus 6, the second Skanska’s development in Bucharest.

Campus 6.1 will comprise approximately 22,600 sq. m. with 11 floors above ground and two levels of underground parking, including an intelligent parking system.

Located at the intersection of two main boulevards, Iuliu Maniu and Vasile Milea, the property benefits from great visibility and exposure, having good access to public transportation.

The metro station is just across the street and trams as well as buses within 50 metres distance.

The property will feature a range of services such as a restaurant and a cafeteria with terraces as well as co-working green spaces equipped with multipurpose furniture and electric sockets and Wi-Fi.

Moreover, the property will be equipped with an intelligent building management system consisting of e.g. an IT Hub in the reception area, a dashboard showing consumption per tenant/floor as well as a virtual reception (check-in and access control for visitors).

A mobile app will connect all the services in the building and in the neighborhood delivering e.g. building info, event news and offering features such as food delivery, car sharing and maintenance help service.

Shared e-car facilities are available for tenants, as well as a Bicycle rental, which is located in front of the building. Bicycle facilities within the building include lockers and showers.

The closing of the transaction is subject to the conditions usual for such transactions and is expected end of 2018.

TOP 10 OFFICE DEALS, Q1 2018
TOP 10 OFFICE DEALS, Q1 2018 2000 1019 BUCHAREST REAL ESTATE CLUB

TOP 10 OFFICE DEALS, Q1 2018

The biggest ten office deals in Q1 2018 total 39, 373 sq. m, the podium concentrating two projects: one in CBD – Day Tower and the other one with two deals in Central West – The Bridge. The total gross take-up in Q1 amounts for 70,000 sq.m, while monthly prime office rent is at the level of 18,5 EUR/sq.m according to data by JLL. BREC compiled this top based on the information released on the market by developers & brokerage companies.

DAY TOWER – 11,500 SQ. M, PRE-LEASE

The first place goes to Day Tower, the office project of Greek-based Day Group, for the pre-lease deal of 11,500 signed with a company active in the energy sector. The new business center is accessible from Unirii Bvd, neighboring the Court Law Building. With nine above the ground floors, Day Tower was particularly sought after for its visibility in a dominant area of Bucharest. The new tenant will occupy the entire building, which is to be finalized in Q3 2018.

THE BRIDGE 2– 6,000 SQ. M, PRE- LEASE

Colliers Romania assisted UPC in the 6,000 sq. m leasing deal at The Bridge 2, the second phase of the business park Forte Partners is developing in the Center-West submarket, near the Basarab overpass. The new space will be the headquarters of the company, thus consolidating operations from two locations, the Nordului office and the one from Sema Park, starting in 2019. “After nearly a decade in its current locations, our client took a strategic decision by relocating its headquarters in a booming office area. This emerging office pole was chosen by our client given the potential of increasing its employees’ satisfaction”, said George Didoiu, Associate Director Office Agency at Colliers International Romania.

THE BRIDGE 2, 4,500 SQ. M, PRE-LEASE

The same building is the protagonist of the third place in our top, as C&W Echinox assisted Forte Partners in a lucrative 4,500 sq. m pre-lease deal, a relocation from a non-competitive stock.
The Bridge office project received the highest LEED Platinum scorecard certification awarded by US Green Building Council (USGBC) for a Romanian property. The Bridge 2, with a leasing office area of 21.000 sqm, is under construction and will be delivered in the last quarter of 2018.

CITY GATE, 4,050 SQ.M, RENEWAL & EXPANSION

E.ON renewed its 2,800 sq. m. office space in the City Gate project in Expozitiei area and also expanded with another 1,250 sq. m in a deal coordinated by C&W Echinox. The two towers dominate the square in front of the main Expo building in Bucharest, the area configuring as a new business hub in Bucharest.  In 2016, GTC successfully streamlined the ownership structure of the whole complex by buying out its minority partner, Bluehouse Capital and now owns 100% of the equity.

WEST GATE, 2,600 SQ.M, RENEWAL

BRD, one of the main players in the Romanian banking industry, renewed its office lease contract in West Gate, the business park owned by local developer Liviu Tudor.
West Gate is one of the largest business parks in Bucharest, developed by Genesis Development, in the West part of the city, on Precizei Blvd. West Gate has five buildings with 15,000 sq. m. rentable area per building of high quality Class A offices and ancillary accommodation.

CORESI BUSINESS PARK BRASOV, 2,300 SQ.M, PRE-LEASE

Cerner, the IT solutions provider for the health care industry, with its Romanian HQ based in Brasov pre-leased a 2,600 sq. m space in Coresi Business Park, in a deal brokered by C&W Echinox.
Coresi represents a complex regeneration scheme of former Tractorul industrial site, assumed by Immochan, on a size of over 100 hectares, comprising of a shopping mall, residential compound and a business park.

S-PARK/MY HIVE, 2,300 SQ.M, EXPANSION

ING expanded with another 2,300 sq. m. its office from my-Hive/ S-Park, the business park owned by Immofinanz, near Presei Libere Sq.

It comprises of 34,000 sq. m class A office space.

Immofinanz announced at the beginning of 2017 an investment plan of 1.8 million EUR to modernize five of its office properties and rebrand them under its corporate office brand, my-Hive.

Following this modernization, S-Park benefits of a spacious lobby with relaxing and socializing areas, as well as other numerous facilities.

TIMPURI NOI SQ, 2,123 SQ.M, RELOCATION

Fortuna, the company active on the online betting segment, relocated its office at Timpuri Noi Square, the project developed by Vastint in the Center-South area of Bucharest. The first phase of the project comprising two office buildings of 32,000 sq. m are 90% leased. Construction works for the second phase are underway, scheduled to be finalized by year end.

BUCHAREST BUSINESS PARK, 2.000 SQ. M, RENEWAL

C&W Echinox assisted CA Immo in the 2,000 sq.m renewal deal for Carpatcement at Bucharest Business Park.

The four buildings within the classically designed business park each offer some 27,000 sqm of office space on five levels, while being surrounded with greene areas.

The property is located in Presei Libere Sq.

GRAND OFFICES, 2,000 SQ.M, RENEWAL

Pharmaceutical company Teva renewed its office deal in Grand Offices, the business centre within JW Marriott Hotel from Bucharest.

The property has 11, 000 sq. m. office space distributed on 10 floors, with flexible floor plates from 24 sq. m.  up to 1.200 sq. m.

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Members’ news: Element Development finalizes Bistrita Retail Park
Members’ news: Element Development finalizes Bistrita Retail Park 1600 1200 BUCHAREST REAL ESTATE CLUB

Members’ news: Element Development

finalizes Bistrita Retail Park

Romanian-based real estate company Element Development has finalized construction works at Bistrita Retail Park, totaling an investment of 9 million EUR. Located on 13A Moldovei street, Bistrita Retail Park is a 7,850 sq. m shopping gallery in a city of 81,000 inhabitants, 100 km North-West of Cluj-Napoca.

“With an 90% occupancy rate and an excellent location, in the city’s new retail hub, near the farmer’s market, Selgros, Altex and Penny, we are convinced we have delivered a competitive product on the market”, said Ionut Bordei, CEO, Element Development.

Carrefour, Churreria Julia, Metropolis, Money Chest and Salad Box have already opened the new units, while JYSK will inaugurate on 31st of May. The other brands will open the new stores in the following weeks, as fit-out works will be finalized.

The new shopping gallery has a diverse mix, comprising of super market (Carrefour Market), sports retailers (Decathlon & Sportisimo), furniture & home-deco products (JYSK, Lem’s, Top Shop), restaurants (Churreria Julia, Noodle Pack, Salad Box and Spartan), toys store – Dinoland, farmacy – Help Net, exchange – Money Chest, pet-shop – Zoo Center and gambling – Metropolis. Bistrita Retail Park addresses a catchment area of 150,000 persons from the city and its surroundings.

The general contractor of Bistrita Retail Park was the local company, Campeador, while Vitalis was the project manager. The exclusive leasing agency was CBRE Romania. The project was financed by Garanti Bank.

5 Things to Consider when Looking to Lease a New Office Space in Bucharest
5 Things to Consider when Looking to Lease a New Office Space in Bucharest 500 308 BUCHAREST REAL ESTATE CLUB

Looking to Lease a New Office Space in Bucharest?
5 Things to Consider when Dealing with Landlords and Real Estate Brokers

Either you are a local or multinational office space occupier, your business needs to have a perfect match when it comes to occupying an office space, especially under today`s costs optimization constraints and qualified workforce shortage.

Before office search and negotiation process become a multiple-resource sponge, here are a few main factors to consider for navigating in the Bucharest office market:

Assign a Senior Project Manager/ Relocation Committee from inside your company

Consider Office Relocation as a strategic project, as it actually is. It impacts your yearly cashflow, employees satisfaction and retention rate, reputation in the market, positioning towards the company`s stakeholders and potentially production/ supply processes. For leading all the phases of office search and negotiation, choose the person/ team in charge based on these essential characteristics: ethics and integrity, negotiation skills, attention to details, strategic thinking, financial understanding, leadership and accountability and, nevertheless, soft skills. Simply think at the amount of your yearly office rent invoice – would you let a process impacting your yearly cashflow in some unexperienced hands?

Do your Homework. Go with a Pro

If your company policies allow you to carry on an agency pitching process, write down a comprehensive brief (with multiple viewpoints from all the internal company stakeholders – i.e. Purchasing Department, Financial, Administrative, HR, Strategy, Public Relations, etc.) and organize a Real Estate pitch for choosing the Real Estate brokerage company that best matches the attributes that are relevant for you (i.e. market know-how, advisory approach, client servicing).  CBRE, Colliers, Cushman & Wakefield Echinox, Knight Frank, JLL or BNP Paribas Real Estate are among the top brokers on Romanian market, but nevertheless a smaller-sized, local agency can also do a good chemistry with you, depending on your company`s needs.

Gross Lease or Net Lease?

Dig the financials and hidden costs, you don`t only pay for what you see. A good advisor or building landlord will be very transparent in explaining all costs triggered by office space leasing (i.e.  maintenance costs, utilities, rent for un-used areas, etc.) – but nevertheless, consider that everybody wants to upsell – so you should better do your financial homework or at least ask the right questions.  Most leases are gross leases or triple net leases. A gross lease means that the tenant pays the landlord one sum and the landlord is responsible for payment of real estate taxes, insurance, and maintenance expenses. In a triple net lease, the tenant pays a set rental amount to the landlord, but also pays a share of the landlord’s real estate taxes, insurance, maintenance expenses, and building utilities.

Independent / Local Landlord or Corporate Building Owner?

It depends on your strategy. Independent, non – institutional developers in Romania tend to be more flexible in various aspects of the negotiation, which turned out to be convenient in many cases (a typical example: when a tenant wants to break the contract exit clauses and leave the building earlier). On the other hand, typical corporate building landlords are well experienced in assets management, corporate clients servicing, hold high standard buildings and facilities, but may come in package with low flexibility or very restrictive contract clauses.

Look well in the Track. Challenge your Advisors and Building Owners

Do they have a portfolio of happy clients/ tenants? Do you know any of the tenants they present in their portfolio, so you can ask for references from the source? Is the building almost fully occupied or is there a large vacancy rate – and why? Why did the last tenant leave the building? Try to gather as many as possible background information and references – a well possible informed decision can spare valuable €€€ and un-necessary future efforts.

Need more insights on the Bucharest Real Estate market? Get in touch with us at bucharest@brec.ro.

New, sophisticated products on Bucharest real estate market: first food hall & lofts apartments on former historic properties
New, sophisticated products on Bucharest real estate market: first food hall & lofts apartments on former historic properties 640 358 BUCHAREST REAL ESTATE CLUB

New sophisticated products on Bucharest real estate market: first food hall & lofts apartments on former historic properties

As Bucharest real estate market is rapidly expanding, investors start to develop new, sophisticated products to reach to a more and more demanding clientele. The initiative follows the European trend under which former industrial spaces are restored and re-converted into products appealing to today’s generations.

EUR 100 M mixed – use project for urban regeneration

One United Properties together with Auchan recently announced plans to invest 100 million EUR in a multifunctional development – One Floreasca City- at the junction of Floreasca and Mircea Eliade roads, downtown Bucharest. One Floreasca City involves three components, integrated in an open project: the former Ford factory will be restored and modernized, following to transform in a contemporary retail space, operated by Auchan Romania, a class A office building – One Tower- and three exclusive blocks of design apartments – One Mircea Eliade.

A new life for an abandoned building

The historic building dates back from 1935, when the American company Ford was manufacturing luxury cars in Bucharest. Under the new development, it will be carefully restored and transformed in a new product for the Romanian market: a food hall and a concept store, with different type of restaurants and services: cooking, gardening and bakery classes, events for kids and family. To respect the heritage of the property, the investor will use for the interior design vintage Ford models, some of them produced in the inter-war years at Bucharest.

Key trends in European food halls sector

The “food hall” concept first appeared in the US, as a mix of authentically prepared food and drink offers with a focus on collective dining and was rapidly adopted on different European markets. A recent Cushman& Wakefield “Food Halls of Europe” study estimated that approximately 100 food halls are either already open or are currently under construction in Europe’s major cities.

Cushman & Wakefield research suggests that the potential for growth is huge. At least 200 venues, totaling over 400,000 sq. m, are in the pipeline for delivery within the next decade. The study indicates some key trends for this sector:

  • Consumer interest in food is a long-term trend – it’s here to stay
  • Eating out is set to increase in many European countries
  • Demand will come from tourists, office workers and local residents
  • Diners are looking for unique experiences and plenty of choice
  • Food offers will need to change regularly to remain current
  • Top quality, ethically-sourced food with a clear provenance is non-negotiable
  • Food Halls are likely to become integrated into wider developments, including shopping centres, public realm improvements and transport hubs

HANNER TRANSFORMS FORMER GRIVITA BREWERY

Under the same trend, Lithuanian-based developer Hanner has started earlier this year works on a historic plot near Basarab overpass: the former Grivita brewery plant. 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 buildings.

In the same development, the company will build a 6,000 sq. m co-work space, targeting Romanian entrepreneurs.

WHAT’S NEXT: Buildings with potential

Bucharest still has potential historic properties suitable for redevelopment and conversion into modern, urban, hip products.

One such place is Moara lui Assan (Assan Mill), a large property on 4.7-hectare plot, ideally placed in a central position, close to Obor metro station.

Moara lui Assan has a reach history: it was built in 1835 and was Romania’s first steam mill. The plant functioned for almost 100 years and constantly benefited from industrial upgrades due to the owner’s futuristic leadership.

In 1948, when the communist regime came in place, the factory was nationalized. After 1990, the factory came again in private property but suffered severe degradation and destruction.

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MIPIM 2018: The most sought-after real estate assets are industrial
MIPIM 2018: The most sought-after real estate assets are industrial 4256 2832 BUCHAREST REAL ESTATE CLUB

MIPIM 2018:  The most sought-after real estate assets are industrial

Tech got mainstream as industry eyed urban future during MIPIM 2018, the world’s leading international real estate business, conference and networking event.

CBRE – Industrial in the spotlight

The annual EMEA Investor Intentions Survey, released during MIPIM by CBRE, confirmed that for European investors the most sought-after real estate assets are industrial, notably logistics. CBRE noted that is the first time industrial has overtaken office investment and the interest in logistics clearly reflects the growth in e-commerce. The report also noted that 33% of investors intend to deploy more capital in 2018 than last year, with 70% of investors actively pursuing ‘alternative’ assets.

CITIES AS ECONOMIC DRIVERS

Representatives from some 60 of the world’s largest sovereign wealth, pension, institutional and insurance company investment funds come together for the annual Re-Invest Summit. Investors acknowledged that the increasing importance of cities as economic drivers, has led them to adopt a city-by-city investment strategy compared to a country or regional approach of previous years.

CUSHMAN: ASIAN INVESTORS INCREASE PRESENCE IN EUROPE

In its annual Global Investment Atlas 2018, Cushman & Wakefield noted that Asian investors were particularly active, increasing their investment in Europe by 96% year on year. Investment from Asia Pacific to Europe hit $39.5 billion in 2017 compared to $20.9 billion heading towards the Americas. The Asian delegation at MIPIM was drawn from 15 countries.

26,000 real estate, city and political leaders, including 5,400 investors, from over 100 countries came together at this year edition of MIPIM.

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