2017 review: Land transactions exceeded EUR 350 mil. Last year, the total value of land transactions for real estate projects (excluding the industrial segment) increased significantly from 2016, exceeding the EUR 350 mil. threshold at national level. According to the real estate consultancy company Colliers International, about 70% of this value was ascribed to Bucharest, where land transactions for residential development represented more than half of the investment volume. The dynamism of the residential sector in terms of land acquisition came as a result of the market’s ability to absorb both small projects and those over 1,000 apartments, as surveys conducted by the European Commission showed that the intention to purchase a home was at the highest post-crisis level. The most active areas were the Center and North of Bucharest: Bulevardul Expozitiei, Bucurestii Noi and the Baneasa-DN1- Jandarmeriei area – due to the future office hub in the Expozitiei area, but also Floreasca-Barbu Vacarerescu, Aviatiei and Pipera areas. “The land market in Romania is seeing one of its best periods in the past 10 years. Demand has diversified in 2017 both in terms of locations and real estate sectors that look for land to develop fresh projects. Moreover, new investors have entered the market, attracted by the higher yields offered by the development of the domestic real estate segment compared to other markets or economic sectors. In Bucharest, the residential segment attracted more than half of the value of land transactions, which grew especially in value, while the rest was almost equally split between retail and office, “according to Sinziana Oprea, Associate Director, Land Agency at Colliers International Romania. The interest in land purchases for the retail sector was better represented at country level than in Bucharest. Demand came from both developers and retailers and it targeted all cities with a shortage of modern retail schemes, including those with a population of less than 100,000 inhabitants. The office land market activity was the most dynamic in 2017 relative to 2016 in Bucharest, where most of the large developers already present acquired plots for new projects. The area that attracted the greatest interest was Bulevardul Expozitiei, followed by Bulevardul Preciziei and the Central area (Calea Victoriei). In Bucharest, the largest transaction was the sale of the Policolor platform – 14 ha – for about EUR 22 mil., aimed for a mixed use scheme (retail and residential). Other notable transactions were the acquisitions made by GTC, Impact Developer & Contractor and Atenor Group in Bulevardul Expozitiei area – transactions of approximately EUR 10 mil. each, the sale of Fabrica Industria Iutei plot and related buildings – 2,7 ha – to Dedeman, in a transaction of approximately EUR 6.7 mil., advised by Colliers International, and the acquisition of the 5,9 ha Coca Cola plot made by Globalworth in Preciziei for the future Renault headquarters. Looking at the broader picture, the Expozitiei area saw the biggest trading interest in Bucharest, recording six deals for office, residential or mixed office development projects involving large players such as Portland Trust, GTC, Atenor Group, Impact Developer & Contractor, Futureal and Iulius Group. These secured around 8 ha of land in the area (including parf of the Romexpo exhibition center, which were the object of a partnership between Chamber of Commerce and Industry of Romania and Iulius Mall), most of them with valid urban plans that allow investors to start their projects as soon as possible. In as far as prices are concerned, at national level, their evolution was similar to that of 2016, increasing on average by 10-15% compared to 2016. Their dynamics varied, however, by region, so some cities or areas in Bucharest saw asset prices unchanged. However, interest in the Central and Northern part of the Capital and in developing cities in terms of the office market (Cluj-Napoca, Iasi, Timisoara, Brasov) underpinned an upward trend in land prices. Leave a Reply Cancel Reply Your email address will not be published.CommentName* Email* Website Save my name, email, and website in this browser for the next time I comment.