More
    HomeUncategorizedJLL Bucharest City Report: 2019 will bring over 900,000 square meters of...

    JLL Bucharest City Report: 2019 will bring over 900,000 square meters of new modern spaces to the market

    Published on

    spot_img
    spot_img

    The real estate development activity could double in 2019 compared to 2018, if all the projects scheduled for this year will be completed, JLL Bucharest City Report shows.

    According to the data announced by the developers, over 900,000 square meters of modern spaces would be completed this year, of which about half represent industrial and logistics projects.

    The stock of industrial and logistics in Romania will thus rise to 4.2 – 4.25 million sqm, an increase of over 10 percent compared to 2018. At mid-year, the stock exceeded the threshold of 4 million sqm, of which over 2 million square meters, is in Bucharest.

    The development activity in this sector is encouraged by the evolution of the demand of the last three years, between 2016 and June 2019 being contracted over 1.7 million square meters of industrial and logistics spaces. For comparison, between 2011 and 2015, about 1.2 million square meters of industrial and logistic spaces were rented in Romania.

    For the whole of 2019, approximately 400,000 square meters of industrial and logistic spaces are expected to be completed. However, considering that 180,700 square meters have already been delivered in the first half of the year and almost 230,000 square meters are under construction, the deliveries will be more than 400,000 square meters initially estimated.

    Due to the strong demand and the very low weight of speculative projects, the unemployment rate remained at 6 percent.

    Industrial and logistics projects to be delivered in H2 2019 in Romania (selection)

    Project

     

    Location Area (sqm) Type
    WDP Stefanesti Bucharest 59.500 New project
    Southern Industrial Park Craiova 30.000 New project
    Eli Park 1 Chitila Bucharest 20.000 New project
    WDP Buzau Buzau 20.000 New project
    MLP Chitila Bucharest 20.000 New project
    Global Vision Timisoara Timisoara 17.500 New project

    Double deliveries on Bucharest office market

    On the Bucharest office market, 2019 will be a record year in terms of new deliveries, the announced volume being 333,500 sqm, more than double the projects completed in 2018.

    Although there were strong new deliveries both in Q2 and Q1 vacancy decreased slightly form roughly 8 in Q 1 to 7.5 percent at the end of Q2. This is because by the time the buildings were delivered they had 80 percent to 90 percent occupancy, or even 100 percent in some cases, such as Renault Bucharest Connected and The Mark. Therefore, the new buildings did not add up much to the overall vacancy rate.

    On the other hand, demand was also strong during the first half and there were almost no major relocations in the market during this period, except for Renault, who moved from Pipera North to the western part of the city in the new project Renault Bucharest Connected, build on demand.

    The office stock in Bucharest was estimated at over 2.84 million sqm at the end of June, and by the end of the year it will approach the threshold of 3 million square meters.

    Over 150,000 sqm is expected to be delivered in H2. Therefore, the vacancy rate might slightly increase to around 8 percent. However, even though at the end of Q2 the projects under construction, to be delivered in H2 had a pre-lease rate of roughly 40 percent on average, with significant differences from case to case, considering that there are several large transactions pending, if those will be concluded in time, the occupancy rate will also go much higher by the time the buildings will be completed. Therefore, new deliveries are not expected to add much to the overall vacancy rate in H2.

    Office projects planned to be delivered in H2 2019 in Bucharest

    Project Submarket Area (sqm) Developer
    Expo Business Park Nord Expoziției 38,000 Portland
    Ana Tower Nord Expoziției 34,700 Ana Holding
    The Light, phase 1 Centru Vest 21,600 River Development
    Equilibrium, phase 1 Floreasca Barbu-Văcărescu 20,600 Skanska

    The lack of new retail projects will be compensated for in the second part of the year

    Following the same trend as in Q 1 there were no new major shopping centers or retail parks delivered in Q2 2019. However, during the period, NEPI Rockcastle finished the new 10,000 sqm expansion of Shopping City Sibiu

    Almost all major deliveries for 2019 will concentrate in the second half, with close to 166,000 sqm expected to be completed, compensating for the lack of new projects during the first half of the year.

    2019 will be characterized by a considerable number of extensions and to a lesser extent by new projects.

    The largest new project expected to be delivered by the end of this year is Festival Shopping Center in Sibiu. The 42.200 sqm shopping center is developed by NEPI Rockcastle, the largest shopping center developer and owner in Romania. In Bucharest, there are no new shopping centers to be delivered this year.

    Retail schemes announced for 2019 –2020 in Romania (>10,000 sqm)

    Project Format Developer Area (sqm)
    Iulius Town Timisoara Extension Iulius Group 47,000
    AFI Palace Brasov New Project AFI Europe 45,000
    Festival Shopping Center Sibiu New Project NEPI Rockcastle 42,000
    Shopping City Targu Mures New Project NEPI Rockcastle 33,000
    Dambovita Mall New Project Prime Kapital 33,000
    Mall Moldova Extension Prime Kapital 30,000
    DN1 Balotesti Extension Prime Kapital 28.300
    Colosseum Center* Extension Colosseum Mall 16.500

    *Colosseum Center includes Colosseum Retail Park and the new 16,500 sqm development Colosseum Mall

    Latest articles

    Metso invests in new screen manufacturing center in Romania to strengthen regional service and supply capabilities

    Metso is expanding its stationary screen production footprint by establishing a new manufacturing center...

    Leonardo Badea, First Deputy Governor BNR: A conceptual analysis on the evolution of the real exchange rate in Central and Eastern Europe after the...

    The exchange rate is a fundamental variable, influencing both the dynamics of the real...

    DN AGRAR and BSOG ENERGY sign development and supply contracts for a biomethane production unit in Alba

    DN AGRAR Group (BVB: DN), one of the leading integrated agri-food companies in Romania...

    Distribuție Oltenia kicks off the 43rd edition of the Electrician’s Trophy: “Field Energy” comes to life in Craiova

    Distribuție Oltenia, the electricity distribution company in the southwest of the country with over...

    More like this

    Metso invests in new screen manufacturing center in Romania to strengthen regional service and supply capabilities

    Metso is expanding its stationary screen production footprint by establishing a new manufacturing center...

    Leonardo Badea, First Deputy Governor BNR: A conceptual analysis on the evolution of the real exchange rate in Central and Eastern Europe after the...

    The exchange rate is a fundamental variable, influencing both the dynamics of the real...

    DN AGRAR and BSOG ENERGY sign development and supply contracts for a biomethane production unit in Alba

    DN AGRAR Group (BVB: DN), one of the leading integrated agri-food companies in Romania...