Fast Market Research recommends "Romania Real Estate Report Q1 2014" from Business Monitor International, now available
Boston, MA -- (SBWIRE) -- 02/20/2014 -- Romania's economy as a whole is forecast to grow by 2.8% in real terms in 2014, according to our Country Risk team's latest macroeconomic outlook. Underpinning our continued relative optimism for the country's commercial real estate sector is growing activity in the local construction market and an increase in pipeline dynamism which should help to re-invigorate the commercial real estate sector as it continues to suffer the after effects of the global financial crisis.
With a focus on the principal cities of Bucharest, Brasov and Cluj-Napoca, the report covers the rental market performance in terms of rates and yields and examines how best to maximise returns in the commercial real estate market, while minimising investment risk and exploring the impact of the eurozone crisis on a market already characterised by austerity.
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Cautious tenant demand amid a climate of uncertainty continues to dominate market sentiment in spite of an anticipated improvement in market fundamentals. As such, in terms of the leasing market, conditions are set to remain tenant favourable. Most occupiers look set to continue implementing cautious strategies, with lease renegotiations remaining on trend to ensure cost containment and value for money in a soft market with limited new supply.
While there is some scope for growth in rental rates in 2014, our overriding outlook is for rates to remain broadly stable over the course of the year with potential for marginal decreases in some cases.
- Romania is becoming an important manufacturing hub, with the country gaining a reputation as a hub for automotive production as well as for the green energy sector.
- One of the biggest developments in recent months has been the investment by Luxembourg-based Energreen Investement Europe, which has announced plans to invest in two fovoltaic parks in Brasov.
- A number of new development projects were approved by local authorities during 2013 with the sector expected to see between 125,000m2 and 300,000m2 of office space delivered to the market during 2014 and 2015.
- German investment bank Deutsche Bank has announced plans to open a software development service centre in the capital, Bucharest, leading it to lease 7,250m2 of office space in the city.
Key BMI Forecasts
- In the office segment, rental rates are projected to remain broadly unchanged over our October 2013 to March 2014 forecast period. However, the city of Brasov will see a marginal increase at both ends of the market, with minimum and maximum rates both growing by 2.3% over the period.
- In terms of the retail sector, rates will again remain largely flat over the next few months, however, Brasov will see rates decrease slightly at both ends of the market with minimum and maximum rates both forecast to fall 2.7% during October 2013 to March 2014.
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