July
2008
REAL ESTATE
 
Vol. 4 No.6  
 

MOST POPULAR 10/08

The Diplomat Guides

Bucharest Hotel Guide 2007

Guide to the biggest names in local law - Bucharest 2009

Bucharest - International School Guide
 
LINKS

Property of the month

Rich baroque delight with stunning murals
STORY TOOLS
post a comment
e-mail this story
print this story
 

CALEA VICTORIEI Located behind the Romanian Atheneaum, this exquisite 19th century residence is ready for rent through real estate agency Perfect Casa.
The impressive forged iron staircase in the reception room with sculptured rams’ heads at the end of the bannisters welcomes guests to this grand and mysterious aristocratic-style seat.
Although unfurnished, the villa is decorated with intact murals by French 19th century painter Edouard Touduze of the nobility at play, musicians and pagan-style festivities, perfectly complementing the rich baroque style of the interiors.
Miniature pictorials of the wealthy at leisure are placed above many of the entrances, giving the impression that the door to each room hides a different and exciting story. In one of the living rooms, 19th century French artist Jean Alfred Marioton has also painted a circular ceiling mural of fairy-tale goddesses and garlands in golden and yellow veils.
With 12 rooms partitioned on a basement, ground floor and first floor, one bathroom, two toilets and two kitchens, this rare delight can be used either as a residence or deluxe restaurant. The property is not equipped with a burglar alarm or interphone and the heating system, though in good shape, has never been replaced.

Inside facts
Rental price: 25,000 Euro per month
Rooms: 12
Built area: 432 sqm
Floors: basement, ground floor, first floor.

For more information call: Iuliana Andrei
at Perfect Casa on 0724 420 6982


Decline in Communist flat prices set to be gradual

Location remains key to value of Communist-era flats, as average prices register a drop, writes Corina Ilie

Real estate prices for Communist era apartments are showing signs of decline, while prices for new apartments stay flat.
But the fall is not set to accelerate, argue experts, because there is still a lack of supply on the residential market.
Between April and May this year, Bucharest’s new apartment prices remained at 1,909 Euro per sqm, while older apartments droped by five per cent to 1,808 Euro per sqm, according to Colliers.
Communist-era apartments in attractive central locations ensure the prices for old apartments are not seeing a rapid fall, while new flat developments in the less accessible outskirts are keeping their average price flat.
In general, the average price is still higher than in January 2008, so does not mean there is a sharp decline.
Demand is high and is likely to remain so for a long time because only around 2,500 new apartments will be delivered this year in Bucharest for an unofficial population in the region of 3.5 million.
However more people are starting to pay attention to property quality and the long term value of real estate investments.
“Consumers think more before deciding to buy an apartment,” says Cristian Bratosin, broker at real estate agency EuroMetropola. “They now have higher expectations than before and need more time to compare the alternatives.”
Specialists expect the decline in Communist-era apartments to be slow, considering there are still many customers who want to buy a property quickly and will not wait for the delivery of new residences.
“All customers look for a central location, near a metro station, sound insulation, a clean building and elevators that work,” says Radu Lucianu, general manager of CB Richard Ellis-Eurisko. “When a developer asks for 2,000 per sqm for an apartment that complies with all these conditions and the owner of an old apartment with none or only few of these conditions fulfilled, it is clear which the buyer will chose.”
Location is a bonus for owners of apartments built during Communism, such as central or semi-central areas including Magheru Boulevard, Calea Victoriei, Piata Romana or Piata Unirii. The retention of such buildings in central areas also reduces the chances of new developments in these zones. Instead investors must locate their projects outside Bucharest, in villages such as Mogosoaia, Corbeanca and Stefanesti, which have poor infrastructure and unreliable transport links to the city.
“If a developer decides to build a residential complex that meets all the quality standards in the middle of the field in Mogosoaia or Pipera, they should not ask for 2,000 Euro per sqm because they will not get it,” says Lucianu.
Even if the prices on old apartments fall, this market will always attract customers who cannot afford to buy apartments in the new projects – the so-called bottom feeders.
The only problem is if the apartments have a finite lifespan due to the general decay in the choice of building materials and the block’s lack of maintenance.
“Some old buildings could be at risk, but others which are solid and well located could be a good option,” says Charles Krick, head of capital markets Jones Lang LaSalle Romania.
In the last three years, the asking price for Communist-era apartments has been very high and customers found it difficult to negotiate for a discount. Now the prices have dropped and buyers have seized the opportunity of greater flexibility in the market.
“The asking price has gone down by 15 to 20 per cent in the past month,” says Valentin Ilie, CEO of real estate firm Coldwell Banker in Romania. “People have not called our brokers during the past few weeks because they knew that they would not get a discount. As soon as the asking price went down, the phones starting ringing again.”
The old apartments market also has a solid advantage – customers can see the product they purchase. Many consumers find it hard to trust the ability of developers to deliver new residential projects on time and at high quality.
Competition is also perceptible, as developers of new projects are now giving away furnished kitchens in the asking price. “Offering furnishings happens in Spain, where the developer uses incentives because he has financing contracts with banks that do not allow him to drop the prices on apartments,” says Lucianu. “Some of them offer cars worth up to 20,000 Euro.”


Caution sweeps east European property market

RETAIL SCARE Commercial real estate transactions between January and March 2008 dropped by two thirds to 119 million Euro compared to the same period last year, with analysts blaming the fall-out from the global credit crunch.
The Czech Republic registered a decline of 77 per cent and Hungary faced a decrease of 63 per cent in the first three months of this year, according to a report by real estate group Cushman & Wakefield.
While transaction volume in Europe fell by 37 per cent compared to the same period in the previous year, the yields registered the fastest growth pace since 1992, according to the report.
Price fluctuation, a lack of financing options and investors’ low trust in the real estate market have lead to the slow down.
In Romania, the office segment was the most attractive sector in the first half of 2008, with 56 per cent of investment funds acquiring office buildings.
Hotels attracted seven per cent of the invested amounts, while the industrial sector did not register any major transactions.


Rainbow over Baneasa

BANEASA Romanian real estate developer Real Time will deliver in February 2009 a residential complex with 28 apartments, developed over seven floors in Bucharest. ‘Rainbow Spring’ is located on Strada Somesului in Baneasa area and comprises two and three room apartments. Purchasing prices per unit unit start from 180,000 Euro.


Shopping centre enters new era

IASI BLVD PACURARI Ermes Holding, part of Greek real estate developer Omilos Group, will expand the total built area of Era Shopping Park in Iasi by a further 50,000 sqm.
Era Shopping Park Iasi, set for deli­very in two phases by winter 2009, will cover 150,000 sqm and will have anchor tenants such as hypermarket Carrefour, DIY store Prakitker, Media Galaxy and furniture retailer Mobexpert.
Omilos Group is developing another Era Shopping Park in Oradea, Bihor county, covering an area of over 180,000 sqm and has budgeted 300 million Euro for investments in real esate projects in cities of Romania with over 150,000 inhabitants.


Property: Bucharest

GARA OBOR
Real estate developer Atlas Estates intends to build 1,200 flats in Bucharest, on the premises of former edible oil plant Solaris, located in the vicinity of Gara Obor. The 32,000 sqm land plot will be redeveloped for commercial and residential use. Atlas Estates is the owner of a 100.000 sqm land plot in Voluntari, Ilfov county, suitable for a residential or commercial project and of the four star Golden Tulip Bucharest Hotel, located on Calea Victoriei.

PIATA ALBA IULIA
Romanian real estate developer German Quality Solution will invest 4.7 million Euro in the construction of a 40-unit residential project in Bucharest. Works on Speranta Residence, developed in the Piata Alba Iulia area, are due for completion next spring. Purchasing prices for the units start from 1,850 per sqm.

BANEASA FOREST
Romanian real estate company Aria House will deliver a four star hotel on Aleea Temisani, near Baneasa forest by 2011. The hotel will be built on a 2,600 sqm land plot and will comprise 220 rooms and over 200 parking spaces. Total investment in the project stands at 17 million Euro.

PRELUNGIREA GHENCEA
French construction group Bouygues will pour around 40 million Euro into the development in Bucharest of two apartment buildings with a total of 500 apartments. The land plot has 14,000 sqm and is located in the Prelungirea Ghencea area, according to Ziarul Financiar. Works could start at the end of this year and are set for delivery by 2012.

VITAN
Real estate division of Romanian RTC Holding will invest 16 million Euro in a 135 flats complex to be developed in Bucharest starting this autumn. The block of flats located on Strada Fizicienilor in Vitan will include one, two, three and four room apartments and 170 parking spaces. The project is set for completion by 2010. This is the second project of the company that last April started works on Theresianum residential project in Sibiu.

Property: Romania

CLUJ NAPOCA FLACARA
German real estate company LBBW Immobilien will start next spring the development of a mixed use project in Cluj-Napoca in an 80 million Euro plan. The construction will be built on the premises of former textile factory Flacara, situated on Strada Somesului. Almost 1,000 flats and office spaces as well as a hotel will be included in this project, according to Ziarul Financiar.

CLUJ NAPOCA DEALUL LOMB
Lomb company, a partnership between real estate developer Impact and Cluj-Napoca local council, will develop a project including 6,000 residential units in the city’s Dealul Lomb neighbourhood. Around 75 of the living units will be alloted to Cluj Council for social housing, along with space for City Hall’s headquarters, as well as for shopping space and cultural centres.

SFANTU GHEORGHE
Founder of retail chain Domo Lorand Szarvadi has budgeted around 20 million Euro for the construction of 200 villas in the Livada area of Sfantu Gheorghe, Covasna county. The project will stretch over 11.69 hectares and each villa will have a total built area of 500 sqm, according to Ziarul Financiar.

NAVODARI
Romanian company Hanul Piratilor, which means ‘The Pirates’ Inn’, is looking for a developer to team up with for the construction of its residential project close to the seaside in Navodari, Constanta county. The complex is also named Hanul Piratilor and is located at the Mamaia entrance to Navodari, This aims to comprise 2,770 bachelor rooms and suites, developed on a 64,000 sqm land plot and shopping and services spaces covering over 250,000 sqm. The space is currently a camping site.

PITESTI
Real estate developer Jupiter Group last month opened Jupiter City shopping centre in Pitesti, Arges county, in an investment worth 42 million Euro. The shopping centre is developed on a 17 ha land plot on an intersection of DN65B with the Bucharest-Pitesti motorway and includes anchor tenants such as Praktiker, Media Galaxy, Mobexpert and Carrefour.


 
READERS COMMENTS
 
Name
Email
Comment
Validation Code
 
Comments
   
 
 
ADDRESS CHANGE

Starting with May, 5th the new adress of The Diplomat Bucharest magazine is 187-189 Traian Street, Sc. 2, 6 Floor, Ap. 38 , 2 District, Bucharest, Romania
 
MEMBERS SECTION
User
Password
Forgoten password
  Register for FREE
THE DIPLOMAT EVENTS
LINKS