How Many Of Planned Malls Will Actually Be Built In Bucharest?

Bucharest has more than 15 malls and retail parks in the most important districts of the city now but back in 2006-2007 foreign real estate investors had much more ambitious plans, paying over EUR400 million for 100 hectares of land for new retail developments. Few of those plans stand a chance of materializing, a ZF analysis reveals.

Some of the projects already seem ‘buried’, such as the project BelRom planned to develop on the site of the Helitube plant in Colentina, NE Bucharest, which went insolvent. Israel’s GTC has recently announced the land it had initially allocated to the development of the Galleria mall in Pipera (north of the city) was rendered unbuildable after having its status changed to green space.

The Dambovita Center at Casa Radio (an unfinished communist building in central Bucharest) is frozen for the time being given the significant investment it would have required and its proximity to the AFI Palace Cotroceni mall in the west of the city.

Cypriot investor Panico Panayi no longer has everything he needs to develop the Colosseum mall in Chitila (NW Bucharest), where he owns a 60 hectare plot on which he only built stores to house Carrefour and do-it-yourself retailer Leroy Merlin.

The most likely to see construction work start this year are two projects in the south and west of Bucharest, where the land was purchased at lower prices after the boom years.

South Africa’s NEPI has got the money and tenants to develop a retail park on the former Vulcan plant site in the Trafic Greu-Rahova area of the city (center to southwest of Bucharest), but has not secured the construction permit from the Sector 5 City Hall yet.

Immochan, part of the same group as hypermarket chain Auchan, is about to start work on a shopping center on the site of the former Tricodava plant in Drumul Taberei (west of the city). It got the construction permit and started preparations to choose construction companies at the beginning of the year.

The east of the city should see ParkLake Plaza and Mega Mall built, but construction work has yet to start. The Austrian investors that intend to build Mega Mall near the National Arena stadium have recently said they plan to begin work once they found tenants for half of the 70,000 square meters of the complex, while Sonae Sierra and Caelum hope to break ground on the ParkLake Plaza near the Titan Park in 2014.

Many consultants believe building both projects at the same time is difficult, considering they are seeking a dominant position and are only four kilometers apart.

As the expansion of the Colosseum in Chitila is on hold for now, AFI Europe and Canadian businessman Topolinski will attempt to cover the northwestern part of Bucharest.

AFI Europe has recently received construction permit for its project on the former Laromet plant site, where it had a deal with Real to rent space for a hypermarket. Now that Real dropped its Romanian operations and sold most of its hypermarkets to Auchan, AFI Europe will have to find a new solution for the hypermarket.

Topolinski has recently announced he signed a deal with Cora for the hypermarket in his Victoria City complex and work is due to begin soon.

Other than these projects, only one large retail development is now under construction, the Promenada mall in Floreasca, which should open in the second half of October.

The mall developed by Raiffeisen Evolution is already more than 90% rented, which indicates some retailers still have appetite for expansion in Bucharest and gives developers reason to be optimistic. On the other hand, the experience of City Mall, which went bankrupt and is now undergoing conversion from retail to office space, warrants caution.

(English version by Loredana Fratila-Cristescu)

Plots of land bought for retail center development in Bucharest

* land allows development of a shopping center and other buildings

Source: ZF