SOFIA (Bulgaria), November 23 (SeeNews) – Austria’s CA Immo, which specializes in office properties in Central European capitals, sees Bucharest as offering prospective office tenants a viable alternative to other capital cities in Central and Southeast Europe, the managing director of the company’s Romanian unit said.
“During the last few years, Bucharest has been getting more and more attention from tenants looking to secure local or regional office hubs, taking advantage of the skilled labor force, especially in the information technology [IT] and shared services center [SSC] sectors,” Marian Roman told SeeNews in an emailed interview.
Last month, CA Immo - owner of five office buildings in Romania, said it has started a 75 million euro ($79.7 million) office development, Orhideea Towers, in Bucharest in order to meet the growing demand for office space of its existing tenants.
The Orhideea Towers project - which will have a total gross leasable area of 37,000 sq m and should be delivered in 2017, is located in the Central-West area of Bucharest, an area CA Immo considers as having potential to become the new office hub of the capital.
Demand for new office space in Bucharest is generated by companies seeking to optimize and improve their working space, especially in the IT, SSC and telecoms sectors, Roman said.
“Renegotiation and renewal of contractual terms has seen a downward trend. Overall, the outlook is positive with consolidations and expansions forecast for the 2016-2017 period, which goes to show that business is growing and tenants are confident in taking up long-term engagements,” the official added.
The investment property market – with regards to office schemes - in Bucharest benefited from
a more healthy investment climate last year and the trend is at comparable levels in 2015, Roman said.
Taking a look at the market dynamics in second-tier cities in Romania, Roman said the office market there is experiencing growth in 2015 with regional cities set to perform even better than last year, when new tenants leased around 55,000 sq m.
Although CA Immo’s short- and medium-term strategy is to focus on the office market in Bucharest, Roman said it is good to see that other Romanian cities - such as Timisoara, Cluj and Iasi, are boosting their potential to attract business.
CA Immo, which controls property assets of around 3.5 billion euro, considers as its core markets Austria, Germany, Poland, Hungary, the Czech Republic, Slovakia and Romania.
In Romania, CA Immo is active since 2003 and owns the Opera Center 1 and 2, River Place, Europe House and Bucharest Business Park office buildings with a total gross leasable area of 106,000 sq m.
($=0.941354 euro)