John Frederiksen considers that within ECE region, Romania becomes certainly the next Poland, - having a strong market, dominated by new top developers, with active investors and will for expansion. The political stability and the macro-economic growth (a growth of 4.3 pct of the GDP in the first quarter, the best performance in ECE), says Frederiksen, are representing pluses for Romania. Moreover, Romania has the advantage of qualified personnel and sustainable salary packages, says the president of the European Property Federation.
The Romanian real estate market is attractive as there is still room for development and construction in all sectors, including infrastructure, considering that Romania needs to meet the European standards in terms of buildings stock and quality as well as management.
Frederiksen says that this wave of optimism is felt in all the real estate market, based on the improvement of the economic conditions, the cheapening of the financing, the very low yields of the bonds, so both the investors preferring the risk and those oriented towards core assets are active on the market.
„Generally the investors are climbing the risk curve, mostly due to prime assets shortage in core locations, so they are showing a larger appetite for secondary or even tertiary locations”, adds the president of the European Property Federation, also saying that he expects to see in Romania further expansions from the large retail networks, as well as a constant growth on the office market.
„Moreover, we consider that new investments funds will enter the Romanian market and will buy existent buildings”, he added. Considering the residential market, the specialist says that the trend is still based on building projects with small to medium units. Another sector with a good improvement for Romania is the logistics, especially on the production segment.
“We consider Romania a very good place for constructions for Europe, as there is still a lot to develop in all real estate market segments”, Frederiksen said.
Which are currently the most attractive European markets for real estate developments?
The central business districts of large European cities are still the most attractive markets for investors and developers, despite the fact that there is more and more difficult to find large plots for new projects. Usually, says the specialist, the developers are forced to find solutions for building on small plots.
„Those areas will never face the crisis”, Frederiksen mentioned. The most attractive markets in Europe according to the president of the European Property Federation include Poland, a hot country from the point of view of the new office developments, Russia and Turkey on the retail segment and Germany and the Netherlands for industrial and logistics projects. At the same time, the UK is considered particularly attractive mainly due to the developments starting or already in construction on the office and residential segments in London.
Regarding the challenges, the investors are confronted with the price obstacle, as well as the one of the availability of the attractive assets and of the competition from other investors. To a macro level, says Frederiksen, the economic growth is very important for the real estate market development. Each country, including Romania, should encourage the local businesses to grow through tax cuts and reducing bureaucracy. Not least, says the professional, in order to attract new investors is vital for a country to build a sense of confidence.
John Frederiksen says that at the European level there is perceived a general trend to grow the value ofthe loans from 60/40 to 70/30. Moreover the financing operations are diversifying, so the bank loans are not any more the only option for the real estate companies. (source: wall-street.ro)
