Property investments in Romania rise 21% y/y to 410 mln euro in H1 - JLL

Close to 90% of the total property investments in Romania was made in Bucharest in the first six months of the year, JLL said in a press release.

Over 85% of the market volumes were office transactions, followed by industrial and retail deals, which accounted for 8% and 7% respectively.

"In Romania, 2020 started with a large pipeline of transactions; several high-profile office deals were in advanced stages of negotiation. While the outbreak of COVID-19 had a significant impact on the Romanian investment market, the total transaction volume in the first half was still 21% higher than the one registered in the same period in 2019," JLL Romania head of capital markets Andrei Vacaru said.

According to JLL, the Covid-19 outbreak had a strong impact on the investment real estate market in Romania, and many of the on-going deals were put on hold during the lockdown period which lasted from March 15 until May 15. However, towards the end of the first half, activity started to come back with several major transactions in progress once again and handful of office sales were completed in Bucharest in the second quarter, as the discussions were very advanced before the pandemic.

The average value of transactions was 27 million euro in the first half of 2020, mainly due the signing of several very large deals which include pan-CEE portfolios and sizeable assets.

The largest transaction registered in the first half of 2020 was the sale of approximately 61.49% of Polish real estate developer Global Trade Centre's (GTC) local portfolio. Other notable office transactions in Romania were the acquisition by Romanian DIY retailer Dedeman of the third phase of The Bridge - a 21,100 sq m building located in Bucharest, the acquisition of Global City Business Park, a 50,000 sq m park in Bucharest by local real investment firm Arion Green Investment and the acquisition of 50% of Renault Business Connect in Bucharest by London-listed Globalworth Real Estate Investment.

The only retail transaction concluded in the first half of 2020 was the acquisition of Oradea Plaza, a mixed-use project, by Lotus Centre, a local group based in Oradea.

The largest industrial transaction was the acquisition of Equest Logistic Park by Czech real estate developer CTP for 30 million euro, from Dutch-registered holding and finance company Forum Serdika.

One hotel was transacted in the first half, Golden Tulip, which marked the entrance on the local market of Beirut-based premium brands distributor Fattal Group.

Local capital is starting to play an increasing role in the Romanian investment market, as Romanian buyers accounted for 28% of the transaction volume in 2019 and for 35% in January-June 2020, JLL also noted. The most active players were Dedeman, local real estate developer One United, Lotus Centers and local logistics projects developer Element Industrial.

JLL is specialised in professional and investment management services in real estate. With a global annual revenue of some $7 billion, it has 300 branches in 80 countries and employs over 93,000.

($ = 0.8522 euro)