The Property Banks Romanian Property News
Bulgaria set for Property Boom in 2007, 1st March 2007, Holiday Lettings.co.uk
New
reports suggest that house prices in Romania and Bulgaria could be
taking off this year, exceeding expectations for housing markets in
Western Europe.
According to Italian property researcher Scenari Immobiliari (SI),
the established markets in Europe can expect a slowdown over the
coming year.
Housing markets in England, France and Italy all saw increases in
turnover of around three per cent, marking a slight decline in last
year's growth rates.
Spain was the best performer in the European market, with a turnover
of 9.5 per cent, a little higher than the eight per cent growth
reported for the 2005 to 2006 year.
However, this rapid growth is set to slow, the experts at SI
predict, but emerging markets in Eastern Europe should see continued
expansion.
Romania, Bulgaria and Russia were all highlighted as having
potential for large increases in house price revenue over the coming
year.
SI attributes the predicted 'out-and-out' boom in Romanian and
Bulgarian property markets to the countries' entry into the European
Union.
South Pacific Group launches projects worth over 100m euros, 02.03.2007
South
Pacific Group, an Australian-owned real estate development firm,
which owns 50-60 hectares of land in small towns close to the
northern part of Bucharest, plans to develop real estate projects
exceeding 100 million euros over the next couple of years.
South Pacific Group is currently developing four residential
projects in the Tunari area in the northern part of Bucharest, where
it owns approximately 10 hectares of land and intends to build 550
homes.
"We noticed the growth potential of the Pipera area, where the
properties almost doubled in value every year, becoming unaffordable
for middle class buyers. We looked at a second area, Tunari, located
12 kilometres from the city centre and close to an area of Bucharest
that has generous job offers," said Andrew Prelea, joint CEO of the
company.
South Pacific Group is controlled by businessmen Richard Gardner,
Geroge Prelea and Andrew Prelea, it employs 50 people, among whom
five Australians, including the companyes managers. Andrew Perelea,
39, who was born in Romania, has dual citizenship.
The main areas where South Pacific Group purchased plots of land are
Tunari, Runcu, Dascalu, Dimieni and Otopeni.
"We intend to develop a large project in Dascalu, on a 10
hectare-plot, as we are encouraged by the future construction of the
highway to Ploiesti, in the region. The construction works may start
in the first half of next year and the real estate project will
comprise retail areas, covering 15,000 square metres, as well as 600
housing units. The investment is estimated at around 60 million
euros," stated Prelea.
At the moment, the South Pacific Group is focusing on the
developments in the Tunari area, where the company is building four
residential complexes. Each of the residential complexes in Tunari
is named after a city in Australia, the latest project being named
Canberra.
The first project of South Pacific Group developed on the Romanian
market is located in Straulesti. It was commissioned by the Ministry
of Defence, with the seven blocks of flats to be completed in July,
three months earlier than planned.
Romanian property market draws 800 million
euros in 2006
Investment in real estate projects amounted to about 800 million
euros in Romania in 2006, a Romanian real estate consultant said on
Friday.
A majority of investment centered around projects for office
buildings, Mihai Plaesu, consultant with local real estate company
DTZ Echinox, was quoted by the national Rompres news agency as
saying.
The Year 2006 also saw a slight rise in office building rentals in
the market. DTZ experts estimated that a total of 200,000 square
meters were rented because of the entrance of some new companies,
the expansion of existing ones and some mergers on the market,
especially in the IT and pharmaceutical field.
More foreign companies would now come to Romania after the country's
acceptance as a member of the European Union on Jan. 1.
Office spaces in Romania to be rented totaled 750,000 square meters
in 2006, which increased by 25 percent over 2005.
The vacancy rate of office buildings is currently below 3 percent,
and more than 30 percent of the estimated stock have been rented in
advance for 2007
Romanian property prices moved up 5.5 per cent
Between the third and fourth quarters of last year, figures from the National Statistical Institute reveal. Based on price per square metre Lovech had the fastest rising prices – up 18.6 per cent – followed by Targovishte – up 18.3 per cent – and Stara Zagora – up 15.5 per cent.
Discover the untouched delights of the Romanian Black Sea Coast
Want to
know a secret? Romania, and in particular its Black Sea Coast, is
the place to be this year– property investment wise. In a study
carried out by Price Waterhouse Coopers and Channel 4 in 2006
Romania ranked the top property investment country in Europe for the
next ten years, with a staggering 414% return on investment. That
works out to a remarkable 17.8% annually.
It’s not hard to see why many other analysts share their views.
Property prices for a start are well below the neighbouring EU
countries of Hungary and Bulgaria. Additionally, the economy has
performed impressively in the last few years and with Romania now a
full EU member and expected to join the Euro by 2010, another
dynamic growth in the real estate sector is predicted.
Most of the property buying attention has traditionally been focused
on the capital, Bucharest where property prices average at £50,000
however interest is now shifting to the beach resorts along the
southern Black Sea Coast where new build properties average at
£40,000, 20% less than the city. The recent growth in tourism in
this area is set to continue and the World Travel and Tourism
Council (WTTC) predict further growth of around 7.9% per year from
2007-2016.
The Romanian Black Sea coast stretches out for 245km from the
unspoilt natural reserves of the Danube Delta to the leisure
activities of numerous holiday centres in the south. Whilst the
delta is strictly protected from intrusion, the southern 72km is
being developed.
The coast is famous for its fine sand, low salinity levels (17%),
gently sloping beaches and a virtual absence of tides and currents
(ideal for young families). Its location in south-eastern Europe
offers a pleasant, warm and dry climate (above 21°C/70°F between
June and September). With a long holiday season (May – Oct), maximum
opportunities for rental income also exist.
From the UK, a number of airlines (including BA & KLM) offer direct
flights to Bucharest and then a transfer flight can be taken to the
airport in Constanta on the Black Sea coast.
Some of the best resorts on the coast are Mamaia, Eforie-Nord,
Neptun, Venus and Costinesti:
Mamaia
Despite being the oldest of the Black Sea resorts, Mamaia is still
Romania’s most popular beach and party centre, annually hosting the
National Pop Music Festival (early Sep). First developed in 1906 on
an 8km strip of beach dividing the fresh water Lake Mamaia and the
Black Sea, the resort now boasts discotheques, casino, leisure
parks, water park and a summer theatre.
Eforie Nord and Techirghiol
The well-established spa resort of Eforie Nord offers a wide variety
of specialised treatments using mineral-rich water taken from
Techirghiol Lake. Techirghiol Lake gained its reputation thanks to
the special curative qualities of its black, sapropelic mud,
recommended for the treatment of rheumatism and dermatological
disorders.
Neptun-Olimp
Until 1989 Neptun-Olimp was the exclusive resort of Romania’s
communist party and the late dictator Nicolae Ceausescu had his own
luxury villa and private jetty here. Situated in the Comorova
forest, the resort has an exclusive, elegant feel to it and caters
for a slightly older clientele. A wide range of entertainment,
restaurants and water-sports facilities are available.
Venus
Situated on a picturesque promontory, this purpose-built resort has
a 1.5km long beach which offers the opportunity to try the many
water sports on offer.
Costinesti
Costinesti has one of the best beaches in the area. Another popular
resort with the younger holidaymaker, it is host to a series of
cultural and entertaining events, including, The Assembly of Young
Actors, The Film Festival for the Young and Jazz Festival.
Now a fully fledged EU member, purchasing a home in Romania is set
to become even easier as buying and finance laws are being relaxed
and companies such as UK-based Romania Revealed are always on hand
to help clients and assist through the buying process. It is one of
the few UK based companies offering property in Romania and only
work with quality established developers to ensure the highest
standard of build.
An example of the type of properties available in the area includes
the Cronos Residence in the resort of Neptune which offers a choice
of one or two bedroom luxury apartments with terraces from £43,500 /
€64,500. The Cronos Residence is located 150m from a clean, sandy
beach and close to all the town’s facilities: cinema, summer
theatre, sports grounds, water-sports, children’s amusement park,
spa centre, shops supermarkets, restaurants, bars and nightclubs.
There is a swimming pool available in the grounds for all residents
and the ground floor is to be used for a choice of restaurants,
cafes, fitness clubs and boutiques. There is also a 5% guaranteed
rental contract from the developer for 3 years.
For many considering buying on the Black Sea Coast, the Bulgarian
resorts of Sunny Beach and Nessebar spring to mind however mass
tourism and over development over the past decade has led some to
believe that the market has reached its peak. It is therefore now
Romania’s time to shine with the hottest costal resorts in Eastern
Europe.
Full of eastern promise
MANCHESTER developer Modus has sealed a £296m property deal in
Romania, just three weeks after the country joined the European
Union.
Modus has signed leading European retailer Carrefour as anchor
tenant at the £296m Colosseum shopping centre, in the heart of
Bucharest.
Romania has become one of the most tempting targets in eastern
Europe for commercial property investors. Modus is joining Austrian,
Irish and Czech developers in exploiting opportunities in the new EU
member state.
Carrefour will take 161,000sq ft in a scheme which will eventually
total 1.6msq ft.
Modus is developing the scheme in partnership with Nova Imobiliare
S.R. Located in the affluent north west of Romania's capital city,
the Colosseum is set to become one of the premier shopping centre
destinations in eastern Europe.
It will include a 16-screen cinema, restaurants, bars, coffee shops,
family play areas and a bowling alley.
Mark Chappell, Modus' European director, said: "Carrefour's signing
confirms the strength of this location as a retail destination, and
we are firmly on track to deliver this prestigious scheme."
Romania, Bulgaria enjoying major Property Boom
BUCHAREST, Romania (AP) — Buzesti Street used to be one of the
shabbiest parts of Bucharest with crumbling, Communist-era
structures and one of the city’s roughest markets.
Now, gleaming multistory buildings have turned the area into one of
the capital’s new business centers — testimony to a property boom
sweeping Romania and Bulgaria, the newest members of the European
Union.
“It used to be hell here,” said Toader Grigoras, a 55-year-old
priest who has lived in the neighborhood for more than a decade.
“It’s good now that all the mountains of garbage have gone, but
there’s a lot of noise.”
It’s the sound of unprecedented demand for real estate: In Romania
and Bulgaria, some property prices have more than doubled in the
last three years. And analysts say there’s no end in sight to a boom
fueled by domestic demand, increased tourism and foreign investors.
It’s a far cry from the 1990s when mortgage lending was not
permitted and banks languished under state control in both
countries.
Last year, 80,000 people in Romania — population 22 million — signed
up for mortgage deals. In Bulgaria — population 7.7 million — there
were 31,000 applicants. Interest rates in both countries range from
7 percent to 9 percent.
Marian Tudor, a Bucharest real estate dealer, says Romanians are
staging an exodus from the tiny, crammed apartments prevalent under
dictator Nicolae Ceausescu, who was overthrown and executed in 1989.
“Everyone wants to move out of the drab Ceausescu buildings,” Tudor
said. “And many of the buildings that were built before communism
are not earthquake-proof, so (they) are not a good buy.”
Prices for apartments in Bulgaria increased by an average of 15
percent to 20 percent in 2006. In Romania, values rose an average of
8 percent to 10 percent. But in some parts of Bucharest and Sofia,
the increases are much higher, with rates of return on investments
among the highest in Europe.
Mike Lloyd, chief executive for a $1.55 billion real estate
development in the Baneasa district north of Bucharest, said bluntly
that Romanians simply “won’t put up with crap anymore.”
“What would have been put up with years ago won’t do any more: You
could build rubbish and tell them it was great and they would
believe you,” said Lloyd.
All agree that joining the EU has been the main catalyst for growth,
lending more credibility to both countries and attracting investors
who are seeing their returns grow stagnant in more developed
countries.
Romania’s vast swathes of agricultural land also are the focus of
much interest — and some believe there could be staggering price
increases of up to 40 percent this year if foreign developers
continue to swoop.
Prices for land with development potential could shoot up by 20
percent to 25 percent this year, said Radu Zilisteanu, spokesman for
the Romanian Association of Real Estate Agents.
However, Lloyd, the Bucharest-based developer, cautioned that not
all investors stand to make big gains in Romania.
“There are 17 shopping center projects at the moment (in Bucharest)
and that is gross overdevelopment,” said Lloyd. “We will end up
where lots of them fail.”
In Bulgaria, some also fear the construction boom is going too fast.
About 1.5 million tourists visited Black Sea resorts such as Sunny
Beach and Golden Sands last year, but many luxury hotels are
standing half-empty. Nevertheless, investors continue to build new
ones.