The real estate company at the end of 2023 interviewed the managers of some of the most important local, regional and global real estate investors and developers with an overall portfolio in Romania of over EUR10 billion, accounting for around half of the local real estate market.
The survey reveals that the main concern of real estate players is related to the level of interest rates, which was indicated almost unanimously (79% of respondents) as the main macroeconomic risk likely to impact Romania’s real estate market, a market that will also be influenced by inflation (84%) and geopolitical situation (78%).
Despite existing challenges, most investors (65%) are seeking to expand their portfolios, while 32% of them plan to maintain their current portfolios in the next three years, and 3% indicated expectations of curbing their local activities.
“The second edition of the survey conducted among investors and developers of Romania once again pointed to their confidence in the local market. 2023 marked new records, particularly in terms of demand, in line with the expectations of participants in the late 2022 survey. Borrowing costs and inflation are still the main concerns, but we believe they will moderate during the current year and pressures over the real estate sector will decline,” says Vlad Saftoiu, Head of Research Cushman & Wakefield Echinox.
According to him, Bucharest remains the favorite destination for future real estate investments, with secondary markets increasingly eyed by a significant number of investors and developers.
As regards the market segments set to attract new investments in the next 12 months, interest in office building developments has continued to slide, as just 3% of respondents (against 5% in the previous survey) expect stepped up activity on the office market. Instead, 13% of respondents see investment potential in housing projects for rent and in data centers.
Most respondents (75%) project more developments on the industrial and logistic segment, while 19% expect new investments in retail projects. Both segments attracted rising interest in 2023.
As regards rent evolution, most respondents (75% vs 55% in 2022) expect an increase on the industrial segment and 56% on the office one, while for the retail segments there are mostly stagnation expectations (49% of respondents).
Asked about demand evolution, most investors forecast stable levels for all space types on the medium term.
(English version by Catalina Apostoiu)