“Our target customer makes pretty good income, an average salary per family member of EUR1,000. Most of the loans taken out for buying a unit in The Park are mortgage loans and they could afford such a high down payment without a problem,” says Silviu Grigorescu, country manager of Hanner Romania, the Latvian-held developer of The Park complex near Tineretului Park in Bucharest, where a studio starts from EUR61,000 plus VAT and a four-room apartment starts from EUR130,000 plus VAT.
“For instance, we have a lot of customers who work in the IT industry and their offices are located in the north of the city, because we are close to the subway. We also have banking and brokerage sector customers, all of whom earn more than the average income.”
Hanner’s country manager says that to be able to estimate a market-wide effect one must look at the final version of the bill.
“Customers have no reaction at the moment and have no clear vision of what is going on. It hasn’t reached the end user yet and the market is not feeling it.”
Latvia had a similar law and abrogated it after a few months of enforcement because it hindered lending. Moreover, the real estate sector affects the banking, construction material and transportation sectors and the country’s Gross Domestic Product, he added.
Hanner Group plans to buy more plots of land for residential development in Bucharest. Suitable land for its plans should be located near a subway line and a park, Grigorescu says.
“We are looking for plots of land for residential development. We seek areas close to parks and subway, either existing or under construction lines. We are mostly looking at Bucharest because the market in other cities is dominated by local developers.”
The group is unlikely to expand into industrial space in Romania, but does not rule out office space, even though that is rather difficult to do now, because of the big actors that dominate the market, he added.
The Park is Hanner’s first project developed on its own in Romania. However, Hanner has previously developed City Center Residence near Carol Park together with Lithuania’s Europa Group and Carol Park Residence, also near the same park in partnership with UK’s Bellerive fund.
(English version by Loredana Fratila-Cristescu)