At Vitalis Consulting, our extensive experience in managing hospitality projects has positioned us as a leader in the construction project management sector in Romania. With a portfolio featuring several high-profile projects, we continue to demonstrate our commitment to quality, innovation, and client satisfaction. Our journey in the hospitality sector is marked by a diverse array of projects, ranging from boutique hotels to large resorts, each uniquely tailored to meet the specific needs of our clients and the communities they serve.

We understand that the hospitality industry is subject to a myriad of regulations and standards, and our team is well-versed in ensuring compliance at every level. This expertise not only streamlines the project lifecycle but also minimizes potential delays and setbacks, allowing our clients to focus on what they do best—providing exceptional experiences for their guests. Among our notable achievements is the prestigious Grand Hotel Boulevard in Bucharest, where we executed a comprehensive renovation that seamlessly blends modern luxury with the building’s historic elegance. Another ongoing project is the Swissôtel in the heart of Bucharest. We also played a key role in the Mercure and Ibis hotel projects, where our team was tasked with delivering exceptional hospitality experiences through innovative design and efficient construction management. These projects highlight our ability to adapt to varying client needs while maintaining a commitment to quality and efficiency.

As we continue to grow and expand our presence in the hospitality sector, we remain focused on building lasting relationships with our clients. Our approach is rooted in transparency, communication, and collaboration, ensuring that we are aligned with our clients’ visions every step of the way. We believe that our clients’ success is our success, and we strive to be a trusted partner in their journey.

Together, let’s create exceptional experiences in the world of hospitality!

Calea Victoriei Rises to 38th in Global Costly Commercial Streets

Real estate investment typically involves owning property to generate rental income or capital appreciation. The European and Dubai off plan properties market presents unique advantages like higher rental yield or early investment opportunities. Rental income from tenants can deliver steady passive revenue month after month. Careful property management and smart financing can maximize cash flows.

Real estate often appreciates over time, allowing for profitable sales in the future. Real estate prices in Europe have increased substantially, with average rents up 18% and house prices up 49% since 2010. Real estate acts as a portfolio diversifier that can hedge against stock market volatility. While past performance does not guarantee future results, real estate historically has low correlations with stocks and bonds.

Calea Victoriei in Bucharest climbs two positions, up to the 38th place, in the ranking of the most expensive commercial streets across the world, as rents in Bucharest recorded the 7th highest growth among the 138 analysed markets worldwide, in the latest edition of the “Main Streets Across the World” report by Cushman & Wakefield. Calea Victoriei, the main retail street in the city, boasts a prime rental level of €60/ sq. m/ month, 9% higher compared with last year, as Bucharest ranks 38th worldwide and 23rd in Europe, on par with Ljubljana. Rents in Prague (€225/ sq. m/ month), Budapest (€140/ sq. m/ month), Belgrade (€90/ sq. m/ month), Warsaw (€86/ sq. m/ month) and Zagreb (€70/ sq. m/ month) were above the Bucharest benchmark, with lower values being recorded in Sofia (€57/ sq. m/ month), Bratislava (€45/ sq. m/ month), Vilnius (€37/ sq. m/ month), Riga (€35/ sq. m/ month) or Skopje (€28/ sq. m/ month).

Milan’s Via Montenapoleone (€1,667/ sq. m/ month) overtook New York City’s Fifth Avenue (€1,628/ sq. m/ month) as the world’s most expensive retail destination; the change marks Europe’s first time at the top in the report’s history, which reached the 34th edition. This reflects a robust rental growth for the reputed Italian street, exceeding 30% in the last two years, further bolstered this year by the euro’s appreciation against the U.S. dollar.

Other changes occurred in relation with the 3rd place, with London’s New Bond Street leapfrogging Tsim Sha Tsui in Hong Kong, pushing the latter on the 4th spot, despite positive rental growth this year. Avenue des Champs-Elysees in Paris retained the 5th position, but the gap to 6th narrowed, following a 25% y-o-y rental growth in Tokyo’s Ginza district. In global terms, rents across the 138 tracked locations have crossed another benchmark, now being on average nearly 6% above pre-pandemic levels, thanks to a strong y-o-y growth of over 4%
The retail sector not only demonstrates remarkable resilience year after year, but also proves its ability to adapt and evolve in response to changing macroeconomic conditions and customer requirements. The retail sector has been buffeted by the broader economic conditions resulting from interest rate hikes in 2022 and 2023, aimed at combating strong inflation. Implications have included a rapid increase in the cost of living, weak consumer sentiment and sluggish economic growth. As a result of such headwinds, it is not surprising that luxury brands have experienced a notable slowdown in revenue growth from approximately 15% in 2022 to 0-4% in the current financial year. Dana Radoveneanu, Head of Retail Agency Cushman & Wakefield Echinox: “Luxury retail in Bucharest continues to evolve, reflecting regional and global trends. Calea Victoriei, the main retail street in Romania, has seen a 9% increase in rents over the past year, one of the highest rates worldwide, indicating growing interest from international retailers. However, rents for premium spaces remain below the levels recorded in other Central European capital cities, such as Prague or Budapest. This dynamic, combined with a global slowdown of the luxury brands’ revenue growth, highlights both the economic challenges and opportunities which the Bucharest market can leverage in the coming years. There are already developers present in Romania who are betting on the growing interest of luxury brands towards the country and who are building retail facilities targeting this retail segment.”

(Source: www.romaniajournal.ro)

NEPI Rockcastle takes over 50 MW solar park in Romania

Monsson Group has transferred full ownership of a 50 MW solar park in Chișinău-Criș, Arad County, to NEPI Rockcastle. Construction of the project, which includes an energy storage unit for improved efficiency and grid balancing, is set to begin in January 2025, following its approval in 2024.

Sebastian Enache, Monsson board member, expressed optimism about the collaboration, stating: “We are happy and proud to have started this cooperation with NEPI Rockcastle, the largest owner, operator and developer of shopping centres in Central and Eastern Europe. As we predicted, now is the time for large consumers to invest in renewables to make their own consumption more efficient, and this is just the beginning.”

The Chișinău-Criș solar park, part of Monsson’s portfolio since 2022, exemplifies the company’s role as a leader in renewable energy in Romania. Monsson has developed over 5 GW of wind and photovoltaic projects, with a focus on integrating battery energy storage solutions to enhance operational efficiency.

NEPI Rockcastle’s green energy programme is advancing in three phases, Economica.net reported. The first, completed in mid-2024, involved installing 38 MW of photovoltaic panels on 27 Romanian properties, generating EUR 7.3 million in revenue in the first nine months of the year.
The second phase targets installations on properties outside Romania, with 24 sites in permitting or construction. The third phase includes the Chișinău-Criș project and the exploration of a second site exceeding 100 MW, supported by an investment of EUR 100 million.

Andrei Radu, NEPI Rockcastle’s Group Development Director, noted: “Our programme is advancing rapidly. In addition to the 50 MW project in partnership with Monsson, we are analysing another location with a potential of over 100 MW.”

(Source: www.romania-insider.com)

We are absolutely thrilled to share that our team has been nominated for the esteemed title of Best Project Management Company of the Year at the CIJ Awards! This annual event is a highlight in the real estate calendar, bringing together the brightest minds and top performers in the industry, and we are truly honored to be recognized among such distinguished companies.

Over the years, our journey has been marked by dedication and hard work, resulting in an impressive track record of 15 nominations and 8 awards. Each accolade we’ve received has been a reflection of our unwavering commitment to professionalism, excellence, and innovation in project management. This latest nomination is not just a recognition of our past achievements; it fuels our passion to continue evolving, learning, and adapting to the ever-changing landscape of the real estate market.

We are enthusiastically waiting for the CIJ event, where we will not only celebrate our nomination but also reconnect with our partners and colleagues who share our commitment to excellence. The opportunity to engage with other industry leaders, exchange ideas, and draw inspiration from one another is invaluable. It’s moments like these that remind us of the collaborative spirit that drives our industry forward.

As we prepare for this exciting event, we want to extend our heartfelt gratitude to everyone who has supported us along the way. Thank you for believing in our vision and for contributing to our success. We wish all nominees the best of luck and look forward to celebrating the achievements of our peers in the real estate sector.

Together, let’s continue to set new standards of excellence and innovation in Real Estate.

One United Properties reports sales of long-term rental properties worth EUR 52.4 million at 6.64% yield

One United Properties, the leading green investor and developer of residential, mixed-use, and office real estate in Romania, has sold long leasehold properties, part of its portfolio of commercial projects, worth EUR 52.4 million in the last 18 months. The total GLA (gross lettable area) of these properties is 20,851 sqm (GLA) and the transactions have achieved an average yield of 6.64%.
Among the properties transacted are One Herăstrău Office, the Lidl retail space at One Verdi Park, the One North Gate 2 building, as well as the commercial spaces in One Cotroceni Park and One High District developments destined for the opening of new sports centres with swimming pool operated by WorldClass.

”The intense activity that our company’s commercial division has seen over the past year and a half suggests a significant increase in investor interest in income-generating assets, signalling that the market for the sale of these properties is not only dynamic but also liquid. This trend is being fuelled by falling interest rates, making market yields increasingly attractive to investors. We sold all the leased assets in the portfolio that were small in size, below EUR 10 million per property, and the demand we found in the market was very robust”, said Mihai Păduroiu, CEO Office Division One United Properties.

Properties marketed by One United Properties are recognized for their sustainability and strategic positioning, providing stable returns in a dynamic market environment. The company’s strategy is to deliver quality, certified sustainable projects that not only meet current market demands, but also contribute to the long-term development of the city. One United Properties has also recently started the construction of One Technology District, a campus of offices and research labs that aims to be the most sustainable in Romania and one of the most sustainable in Europe, built for the German giant Infineon Technologies, a company listed on the Frankfurt Stock Exchange and a world leader in the semiconductor industry. One Technology District will house the largest research and development centre for semiconductor chips in South-Eastern Europe and will serve Infineon’s needs for 15 years from 2026. The total value of the contract amounts to EUR 57 million (excluding VAT) and represents one of the largest pre-let agreements ever recorded in the local office market.

The company is focused on developing fully leased and pre-leased office projects. As of June 30, 2024, One United Properties’ commercial portfolio included 163,000 sqm GLA, of which 119,000 sqm is operational in developments such as One Tower, One Cotroceni Park, One Verdi Park and Eliade Tower, and under construction in One Gallery (former Ford factory undergoing restoration), One Technology District and Mondrian Bucharest.

(Source: www.business-review.eu)

Sustainability and Its Importance in Building a Durable Business

The growing global awareness of environmental impacts and the increasing concern for social responsibility have transformed the way companies operate. In today’s context, sustainability is no longer just a theoretical concept, but an essential component of any business aiming for long-term success. A sustainability strategy is a comprehensive, goal-oriented plan developed by an organization to incorporate environmental, social, and governance (ESG) considerations into its operations, decision-making, and corporate culture. The primary objective of this strategy is to align the company’s practices and goals with sustainability principles. Companies that embrace sustainability principles not only reduce their negative environmental impact but also actively contribute to responsible economic development and social well-being.

Dorel Duliga, CEO of PALD Engineering, explains how sustainability has become a central part of a company’s strategy and why it is crucial for a durable business. “I believe that sustainability should not be viewed merely as an obligation, but as an opportunity for innovation. Sustainability is no longer a luxury; it is an absolute necessity. We have the chance to create technological solutions that not only reduce long-term costs but also bring added value to clients and communities. It’s an opportunity to position ourselves as industry leaders, offering smart and resource-efficient solutions. In every decision we make, we carefully evaluate the impact on the environment, the economy, and the community we operate in. I firmly believe that any business ignoring these aspects will has a significant impact on local communities and society at large. A sustainability strategy is essential for companies for several reasons, extending beyond environmental and social benefits. By considering ESG (Environmental, Social, and Governance) factors and implementing a sustainable strategy, businesses can gain significant advantages at various levels:

1. Cost Reduction: ESG strategies directly reduce costs by promoting resource efficiency. By implementing sustainable practices, such as reducing water and energy consumption, optimizing raw material use, and improving logistics, companies can lower operational expenses and enhance their financial performance.
2. Sales Growth: ESG factors influence consumer preferences. Many customers prefer sustainable products and services, leading to increased sales. Additionally, companies with strong ESG ratings often receive favorable conditions from financial institutions due to being considered lower risk.
3. Promoting Innovation: Sustainability drives innovation within organizations. The need to operate sustainably encourages businesses to seek innovative solutions with a lower environmental impact, such as developing recyclable materials, reducing waste, and adopting cleaner technologies.
4. Employee Acquisition and Retention: An ESG strategy helps companies attract and retain talent, particularly among younger generations who seek purpose-driven jobs and are drawn to businesses that care about sustainability. A strong ESG value proposition can increase job satisfaction and productivity.
5. Risk Reduction: ESG provides a comprehensive approach to risk management. By incorporating standards related to environmental management, worker safety, human rights, and regulatory compliance, companies can mitigate risks associated with fines, lawsuits, and reputational damage. Investors also view strong ESG policies as indicators of effective risk management.
6. Social Impact: Beyond the clear environmental benefits, sustainability has a significant impact on local communities and society at large.

(Source: www.romaniajournal.ro)

Over the last 18 years of activity, we have improved our ability to excel in different sectors of construction development. One of them is the industrial & logistic domain, a truly significant establishment in today’s market. This sector shows intense growth in our division and keeps evolving day by day.

One of the most recent projects we have recently been involved in is the temperature-controlled logistics warehouse dedicated to meat foods. It is a new building raised on a total surface of 3,600 sq.m.. Separately are also added the office and administrative spaces, also part of this project. Today, we work with our partners to achieve the best results that we have set together for raising this warehouse.

The Vitalis team provided Project & Cost Management Services in the pre-construction phase and currently we work by full implication of Project & Cost Management, Site Inspection, Site Management and Health & Safety Coordination Services in the construction phase.
With a team of experts allocated to this project, we are expecting to prove once again our unique performance. Other projects alike which we recently added to our portfolio include a medicine packaging warehouse in Turda, Kaufland logistic center, also in Turda, an automative components factory in Ghiroda and the Siemens factory in Sibiu.

In 2024 the entire industrial market showed a positive evolution marked by new developments along Romania.

As leaders in the market, we work simultaneously in multiple industrial & logistical projects, and we will continue #BuildingTrust and forming new partnerships.

River Development becomes SEMA Real Estate

The local real estate developer and investor River Development announces the transformation of its current brand, River Development, into SEMA Real Estate.

The rebranding marks a new stage for the company, reflects its natural evolution and brings more clarity to defining the communication pillars of our projects in the portfolio and in strengthening the brand positioning in the market.

“The new SEMA Real Estate name and visual identity is actually our authentic identity, which we have resonated with, all these years. More specifically, we’re going back to the future! The keyword SEMA is already recognized for our flagship project, Sema Parc, one of the most significant mixed-use developments in Bucharest, that includes office buildings, commercial spaces and a residential area. The rebranding emphasizes the legacy and importance of this project to the company’s identity and its role in shaping its future developments with professionalism and enthusiasm. Therefore, all our current developments, as well as the future developments, will be under the same umbrella: SEMA,” declares Oana Rădulea, Managing Partner SEMA Real Estate.

She announced the plan to launch our first residential project, SEMA Home, a compound of collective housing and mixed functions, located in the southern area Sema Parc’s. The project is planned to take place in several phases, of which the first one will start in the first quarter of next year.

“Our mission remains the same, to reshape the city by transforming and remodeling the urban landscape in the central-western area of the capital, through the sustainable development of our two large-scale projects – Sema Parc and The Light,” she added.

The slogan of the Sema Parc project – “In the heart of the community” represents a responsibility for their well-being.

“We are motivated to do good by doing better – both in service to others and in supporting causes that lead to positive change in our society. Driven by this desire to do good, this year we established the SEMA Foundation with the purpose of promoting and supporting a healthy lifestyle, both through preventive actions and through material interventions, psychological and emotional support,” says Oana Rădulea, Managing Partner SEMA Real Estate.

(Source: www.romaniajournal.ro)

The Real Estate Market as an Investment Opportunity

Real estate investment typically involves owning property to generate rental income or capital appreciation. The European and Dubai off plan properties market presents unique advantages like higher rental yield or early investment opportunities. Rental income from tenants can deliver steady passive revenue month after month. Careful property management and smart financing can maximize cash flows. Real estate often appreciates over time, allowing for profitable sales in the future. Real estate prices in Europe have increased substantially, with average rents up 18% and house prices up 49% since 2010. Real estate acts as a portfolio diversifier that can hedge against stock market volatility. While past performance does not guarantee future results, real estate historically has low correlations with stocks and bonds.

The residential real estate market size is expected to reach over $550 trillion by 2028. The most common real estate investments are residential properties like single-family homes, duplexes, apartments, and multi-unit buildings.Residential real estate provides the opportunity for rental revenue along with the possibility of value appreciation as property prices increase in the long run. The advantage of residential real estate is that it’s easy to manage, especially if you hire a property management company. There is also steady demand in most areas for rental housing. The downside is that residential properties require more regular maintenance and upkeep compared to commercial real estate. Landlords have to handle tenant issues and repairs. Residential properties have the potential to generate substantial passive income with supervision and financial allocation in sought-after areas.

Various real estate investments fall under the umbrella of commercial real estate, such as corporate office spaces, storefront retail units, manufacturing storage facilities, and healthcare clinics. Although commercial real estate demands substantially larger initial investments, the potential for greater and more predictable income streams from tenant rent payments is appealing. Commercial real estate can provide higher and more stable rental income. Renters tend to be companies entering into longer contractual agreements for occupancy, leading to more stability and less fluctuation in tenancy. Commercial real estate can be more susceptible to swings in the broader economy. In a downturn, businesses may close down locations, impacting occupancy levels.

The land generates no rental income, but its strategic purchases can pay off big in the long run. Vacant land can be purchased for future development or agricultural use. The key is researching locations poised for growth and being willing to hold the land for several years as value builds. Land can appreciate over time. Strategic land investments in developing areas zoned for commercial or residential uses offer lower upfront costs but higher potential returns. While land has lower upfront costs, it requires vision, extensive research, zoning knowledge, and patience to see a return. No matter what type of real estate investing appeals most, thorough research, financial planning, and a long-term perspective are key to maximizing returns. While buying a physical property outright with your money is the traditional route, there are alternative real estate investments to consider. These can provide a lower barrier to entry and a hands-off approach.

The market has many choices besides buying property, such as real estate investment trusts and online real estate crowdfunding sites. Real estate deserves strong consideration for an investor looking to unlock passive income and benefit from a stable asset class.

(Source: www.business-review.eu)

In the world of construction and development, the success of a project often hinges on meticulous planning and thorough evaluation. At the heart of this process lie the often-overlooked yet critical tools – Project Monitoring and Technical Due Diligence reports. In an industry where uncertainties and challenges abound, understanding the importance of monitoring and diligence ensures the success of any development.

Since the beginning, Vitalis Consulting team has been involved in providing monitoring services and preparing TDD reports. Now, after 18 years of activity we proudly look over our +400 projects and continue to build trustful partnerships. With a team of professionals that are dedicated to what they do, our clients have understood how important it is to work together in order to develop these reports. The results that emerge are not only beneficial from a technical perspective, but also financially.

We call Project Monitoring The Must of the real estate market. It is tailored to certify the financial institutions that the investment is sustainable, and that funding is properly used. Hundreds of projects benefit from Project Monitoring services provided by Vitalis Consulting, which are now successful developed businesses. Technical Due Diligence, known as the best tool for assessing development risks is one major and essential step that needs to be taken into consideration before acquisition, refurbishment, or reconversion of a property.

We offer support for TDD studies on both land sites and buildings. The TDD reports show all the irregularities found and a set of suggested measures necessary for adjustment. It is beneficial to provide these reports before starting the project, so the client can be fully aware of all possible risks and further costs.

With these reports as a trusted ally, developers can navigate the complexities of the construction with confidence, ensuring meticulous attention to details.

Bucharest Accounts for Over a Quarter of Romania’s Foreign Trade

Over a quarter (26.4%) of Romania’s foreign trade activity was concentrated in Bucharest, in the first half of the year, with operations worth 13.9 billion euros, according to an analysis by the Chamber of Commerce and Industry of the Municipality Bucharest (CCIB), which is based on the information of the National Institute of Statistics (INS).

According to the cited source, after the Capital, in the first quarter of 2024, Timiş county was located – with a total share of 8.1% of international trade, followed by Ilfov – with 7.7%, Argeş (6.4%) and Brasov (4.2%).
In terms of exports, during the analyzed period, the firms and companies from Bucharest delivered goods outside the country’s borders, worth 4.4 billion euros, equivalent to 19.1% of Romania’s exports. In this segment, the capital was followed by the counties: Timiş – with a share of 9.8%, Argeş (8.3%), Braşov (5.2%), Ilfov (4.8%), Dolj (4, 7%), Arad (4.3%), Alba (4.1%), Prahova (3.8%) and Sibiu (3.4%). Overall, the share of these ten counties in Romania’s export was 67.5%, while the remaining 32 accounted for only 32.5%.

According to the CCIB analysis, the main groups of goods exported by the companies with their headquarters in Bucharest were: machines and appliances, electrical equipment and their parts (27.3%), plant products (18.1%), mineral products ( 13.1%), products of the chemical industry (8.3%), food products, beverages, alcoholic liquids and vinegar, tobacco and tobacco substitutes (5.5%), vehicles and auxiliary transport equipment (4.8%) , base metals and articles thereof (4%), instruments and optical equipment (3.2%), textile materials and articles thereof (3%), weapons and ammunition, parts and accessories thereof (2.2%). All these groups of goods have a share of 86.8% of the export of Bucharest companies, it is specified in the specialized analysis.

Regarding imports, firms and companies with their headquarters in the Municipality of Bucharest reported a value of 9.5 billion euros (32% share of Romania’s imports between January 1 and March 31, 2024). In this regard, the Capital, which holds almost a third of the total import,  as followed in the top by the counties: Ilfov – with 9.9%, Timiş (6.8%), Prahova (5.2%), Argeş (4, 9%), Cluj (3.8%), Brasov (3.4%), Arad (2.7%), Alba (2.7%) and Mures (2.7%).

On a general level, the share of the ten counties in Romania’s import was 74.1%, while the remaining 32 totaled 25.9%. As for the structure of the goods imported by the companies with their headquarters in Bucharest, the main six groups that can be found in the statistics of the analyzed period were: machines and devices, electrical equipment and their parts (22.9%), products of the chemical industry (19, 8%), vehicles, aircraft, vessels and transport equipment (7.9%), foodstuffs, beverages, alcoholic liquids and vinegar, tobacco (7.4%), mineral products (7.3%), base metals and articles from these (6.5%), which had a share of 71.8% of the import of Bucharest companies.

(Source: www.romaniajournal.ro)

BR Analysis | Residential market sees growing demand, Bucharest tops sales

The residential market has been growing this year despite still high inflation and expensive loans. Over 77,200 homes were sold in Romania in the first six months of 2024, up 16% compared to the similar period of 2023, while the number of homes sold in Bucharest and Ilfov increased at an annual pace of 25%, shows a market report released by real estate consulting firm SVN Romania, based on official statistics.

The biggest growth in home sales was registered in Iasi, where the number of dwellings sold in the first half of 2024 was 71.4% higher compared to the number registered in H1 2023. The increase in home sales in Iasi was determined by the registration in 2024 of the final sale-purchase documents for agreements that had been closed in previous years.The weakest result was registered in Arges county, where the number of homes sold was 11.5% below the one recorded in the similar period of 2023.

”The first half of 2024 was a good one for the local residential market, with home sales up nationally by 16%, driven by the decline in interest rates—especially fixed ones, where the threshold of 5% per year was broken, but also by the best level of accessibility in the modern history of the residential market. The average net wage has exceeded EUR 1,050 nationally, which means that currently about 81 average wages (6.7 years) are needed to buy a one-bedroom new apartment in Bucharest, versus a level of 96 average wages (or about 8 years) that were required at the beginning of 2023,” said Andrei Sarbu, the CEO of SVN Romania. According to data provided by the ANCPI, 27% more homes were sold in the capital city in June 2024 compared to the same month of last year, specifically 3,862 units compared to 3,043.

“This significant sales growth highlights the high demand for new homes, driven by the constant increase in rental prices and the high yields generated by real estate investments. In this positive context, North Bucharest Investments recorded almost double the growth rate compared to the average sales rate in the capital. We finalised 72 transactions in June 2024, 50% more than the units we had sold in the same month last year. The significant increase in sales reflects buyers’ growing confidence in the potential of this market,” says Vlad Musteata, the CEO of North Bucharest Investments. The Bucharest real estate market remains a key destination for those seeking a safe and profitable investment. In fact, Bucharest ranks among the cities with the highest number of apartments and houses transacted in June 2024. According to ANCPI, the ranking is continued by Timis with 866, Ilfov with 691, Constanta with 589, Cluj with 569, and Brasov with 551 units sold in June 2024.An analysis conducted by North Bucharest Investments shows that 3-4 room apartments and houses are sought out by 70% of those who want to live in the northern part of Bucharest. Meanwhile, 85% of those seeking an investment that will generate generous rental or resale income opt for 2 rooms and studio apartments. In the northern part of Bucharest, 70% of customers are looking for 3- and 4-bedroom apartments or houses in the Pipera and Tunari areas. Buyers are generally families with 1 or 2 children who are not dependent on public transportation and are interested in properties with spacious terraces or balconies. These apartments are in demand on intermediate floors, which offer views of quiet areas. Another important segment, represented by 25% of North Bucharest Investments customers, prefers two-bedroom apartments. Young families without children are the main clients of these categories of real estate, preferring to live on higher floors and close to public transportation, especially the metro, but also near shopping malls, gyms, and medical clinics. The remaining 5% of customers opt for studio apartments, preferably located near metro stations. Studio flat customers are generally young single people who have come to Bucharest for studies or specific jobs.

(Source: www.business-review.eu)

The last years are marked by a significant accelerated rhythm in the development of hospitality sector. One major factor driving the evolution of this sector in Romania is the country’s increasing popularity as a tourist destination. Our country has a rich cultural heritage, stunning natural landscapes, and a diversity range of attractions that appeal to travelers. As a result, there has been a growing demand for high-quality accommodation, dining, and entertainment options, leading to an expansion of the hospitality industry. Our team continues to be actively involved in numerous projects, including the Hotel Cota 1400, located in Sinaia. This hotel is one full of history, a real touristic attraction for travelers, and a reference of the most famous mountain resort from Valea Prahovei. This collaboration started in 2023 and aims to deliver a hotel that offers 69 rooms and a unit that will fulfill the needs of all guests. In both pre-construction and construction phases, we delivered Project & Cost Management Services. Site Management, Site Inspection and H&S Coordination Services are now provided by us in the phase of construction. We truly believe that this partnership will result with an incredible and high-quality project. Beside Cota 1400 hotel in Sinaia, we are currently involved in other six projects alike. Two of them are located in Bucharest, two in Brasov, one in Satu Mare and another one in Alba Iulia.

Vitalis team will successfully deliver 800 new hotel rooms, projected and designed in conformity with our permanent quality standards.

We are looking forward to be involved in these developments, having a vast experience and an ongoing growing portfolio.

#BuildingTrust in hospitality is one of the reasons that make us proud of our work.

One United Properties 2023 Sustainability Report: 14 Construction Sites, over 21,000 jobs created

One United Properties, the leading green developer and investor in residential, mixed-use, and office real estate in Romania, publishes its fourth voluntary Sustainability Report for 2023. The report highlights the Company’s progress in key sustainability areas and covers vast environmental, social, and governance aspects.

“As our business grows, so does the number of developments that transform the face of Bucharest. In 2023, One United Properties completed 1,549 residential and commercial units, marking our largest annual delivery to date and surpassing all previous years’ output.

“Simultaneously, our Company had 4,281 units under active development, solidifying our position as Romania’s leading green developer. Our operations throughout last year spanned fourteen construction sites, including restorations of the former Ford Factory, now One Gallery, and Braikoff House, soon to be unveiled as One Athenee, both due for delivery in 2025. It has been a landmark year in terms of development, but it was equally important in terms of our strides in measuring our ESG impact. In this context, we are more committed than ever to providing a transparent overview of our operations, resources, and objectives regarding our ESG actions. This unwavering dedication underscores our role not just as developers, but as pioneers of sustainable and responsible development, shaping a better future for Bucharest and beyond,” said Victor Capitanu, co-CEO of One United Properties.

One United Properties operations expanded significantly in 2023, with the value of the developments under construction exceeding 1.5 billion euros and the total surface under construction amounting to almost 900,000 sqm. Over 21,000 professionals contributed to these developments, underscoring the Company’s impact on the local economy. Consequently, One United Properties advanced in 2023 social policies, registering a nearly 35% increase in average employee remuneration, a 34% reduction in the ratio of highest to median annual compensation, and a 9% improvement in the gender pay gap, which now stands at 0.86 across all the workforce. Moreover, the Company introduced a minimum salary of 1,000 euros for university graduate holding full time positions. Employee attrition decreased from 18% in 2022 to 12% in 2023, underscoring a supportive and stable workplace environment. Another important aspect of the urban regeneration promise is the restoration portfolio, which includes bringing back to glory four formerly abandoned buildings, which will be reintroduced to the public circuit as One Gallery, One Athenee, Mondrian Bucharest, and One Downtown. The total value of this portfolio has grown to 260 million euros, marking the most significant private sector investment in Romania dedicated to restoring historical and industrial landmarks. In 2023, the Company measured, for the second year in a row, its CO2 footprint. Consequently, for 2023, One United Properties generated approximately 31 tons of CO2 equivalent under scope 1 emissions and 20,368 tons of CO2 equivalent under scope 2 emissions. The Company also measured, for the first time, partial scope 3 emissions generated on the development sites and across the office developments, which amounted to 1,273 tons.

In terms of corporate social responsibility, in 2023 alone, One United Properties donated 9.3 million lei to supporting local associations and charitable projects. The Company’s CSR strategy is oriented around three verticals: urban regeneration and environmental protection, where One United Properties made total donations of 6.1 million lei; education, sports and entrepreneurship, where the support amounted to 2.9 million lei; healthcare and research, where the Company donated 331.4 thousand lei last year to several causes.

(Source: www.business-review.eu)

Romanians spent €36 billion in large retail chains across 2023, up 11% vs. 2022; supermarkets and hypermarkets accounted for more than 60%

Bucharest, July 2024: Romanians spent €36 billion in large retail chains, an amount 11% higher compared with 2022, out of which the FMCG spending accounted for €22.5 billion euros (more than 60% share), according to the Romania Retail Snapshot 2024 performed by the Cushman & Wakefield Echinox real estate consultancy company, based on the financial results of 116 companies from 12 different retail segments.

The second largest share (€3.6 billion and 10% respectively) pertained to DIY stores, a segment followed by Electro-IT (€3.3 billion and 9%) and Fashion retailers (€2.2 billion euros, 6.1%). Jewelry (€212 million, 0.6% of total sales), Footwear (€356 million, 1%) and Cosmetics (€458 million, 1.3%) retailers had the lowest shares in the shopping basket analyzed in the report. The 2023 annual turnover growth rate was slightly above the annual the inflation rate (10.4%) and slowed down compared with 2022, when the corresponding spike was of 16.3% vs 13.8% inflation.

Vlad Săftoiu, Head of Research, Cushman & Wakefield Echinox: “The retail market performed very well throughout last year, despite the fact that 2023 was the second consecutive year with a double-digit inflation rate. Therefore, all the segments from our snapshot recorded sales increases compared with 2022, most of them above inflation. Moreover, an expanded analysis of the entire 2019 – 2023 period shows that the average CAGR (compound annual growth rate) for the major retail operators (11.5%) was clearly above the average annual inflation rate during the same timeframe (7.9%). The forecast for this year is also positive, considering the official public data which illustrates a consistent retail sales growth compared with the same period in 2023″.

The average annual sales growth rate from 2019 to 2023 exceeded the average annual price growth for most categories (11.5% vs 7.9%), with the exception of Footwear (6.3%) and Home & Deco (6.8%) retailers.

On the other hand, the Cosmetics segment experienced the highest surge in this period (17.8%), followed by specialized stores (17.3%).

The turnover increases reported by the large retailers was sustained both through expansions and organically, due to a growth in sales in physical stores and to the online expansions performed by a series of operators.

These expansions have also come as a result of the investments made by developers (in shopping centers and retail parks) who completed more than 50 projects between 2019 and 2023, consisting in both new schemes and expansions of existing ones, totaling more than 715,000 sq. m of new modern retail spaces.

(Source: www.cwechinox.com)

Over the past years, we have witnessed unprecedented climate changes that oblige us to take sustainable measures in the fight to protect the environment. This is a role that we must be aware of, and our involvement is needed.

The construction sector has already become environmentally friendly, and we, as main actors, continue to find the best methods to reduce any form of pollution. Vitalis Consulting has a large portfolio in Green Energy projects that made us express our commitment in creating a better future. Wind parks, also known as wind farms, proved their efficiency in providing clean and sustainable alternatives when producing electricity. These kinds of projects offer several benefits to both the environment and society. In May 2024 we were proud to become part of such a project in partnership with Eximprod Grup. Our collaboration started in 2023 when working together for developing two photovoltaic parks, one in Ciorani (Prahova) and one in Stalpu (Buzau). This new wind park is located in Cudalbi (Galati) and consists in a new electrical station of 110/33 kV (divided into a connection station and a user station). It benefits of a cable network 33 kV and it develops over a 12 kilometers route. Alike other parks, the project in Cudalbi will become part of the acceleration engine towards a green energy.

Vitalis team relies on involvement in sustainability projects, and we insist on applying all possible methods of reducing the carbon footprint, so common in the construction sector. The experience we accomplished in Green Energy projects make us supportive and we are continuing our involvement in this journey. Together, we can build a brighter future!

New Luxury Destination In Bucharest – H Știrbei Palace

The luxury goods market in Romania is estimated to generate EUR 535.82 million in revenue in 2024, with a significant contribution from online sales (13.8%). Demand for luxury goods is growing, fueled by a population with a rising standard of living.

In this context, CBRE Romania announces its exclusive involvement in the leasing strategy of H Știrbei Palace, an emblematic historical monument located in the heart of Bucharest and one of the most anticipated retail projects in the capital. After the completion of the renovation works, Știrbei Palace aims to become a landmark shopping gallery for luxury brands in South-Eastern Europe.

“H Știrbei Palace is the ideal project for luxury brands that want a strategic presence in Europe, in a premium location. The Romanian retail market has proven its resilience and potential in Central and Eastern Europe, with remarkable results. We aim to transform Știrbei Palace into the city’s luxury shopping destination and bring Calea Victoriei back among the world’s major shopping streets. We believe this project will make a significant contribution to the development of the luxury retail market in Romania and will strengthen Bucharest’s position as a top shopping destination,” said Carmen Ravon, Head of Retail Occupiers CEE at CBRE Romania. In this mandate, CBRE Romania is focused on attracting premium and luxury retailers, responding to significant demand from this segment. The increased interest shown in recent discussions confirms the robust potential of the Romanian market. “We are delighted to join forces with CBRE, whose outstanding reputation and track record in the real estate realm speaks for itself. This partnership reiterates our commitment to place Romania on the map of luxury shopping destinations and validates the enormous potential of H Știrbei Palace, while marking an important step in our strategy to attract exclusive brands and offer customers a unique shopping experience,” said Ana-Maria Nemțanu, Leasing Director at Hagag Development Europe.

Optimistic Prospects for the Luxury Market in Romania
The luxury retail market in Romania is on a continuous rise, with Bucharest becoming an increasingly attractive destination for premium brands. This trend is fuelled by the development of prestigious real estate projects, including 13 new five-star hotels planned by 2028, which will host brands such as Corinthia, Mondrian, Hyatt, and Kempinski.

According to a market report published by CBRE Romania, there was an increase in prime rents for high-street locations in the first quarter of 2024, reflecting the dynamism of this segment.

(Source: www.business-review.eu)

Romanians and foreigners want to buy luxury apartments or villas, especially in Bucharest or Brasov

The real estate market in Romania is constantly developing, which directly influences the increase in demand for interior design, higher by 20% in the first half of 2024 compared to the same period in 2023, according to data from MiSo Architects, one of the leading interior design and consulting studios real estate on the market. Thus, more and more Romanians both from the country and those from the diaspora, but also expats and foreigners from Europe, the Middle East and the USA aim to purchase apartments, houses or villas, especially luxury properties, in Brașov or the Capital. Against the background of this high interest in housing, the segment of real estate consulting for the right decision regarding the future property is growing spectacularly.

From the perspective of the high interest in the purchase of housing and the growing number of requests for fitting out newly built apartments or houses, the real estate sector in Romania continues its growth rate. Buyers are particularly interested in luxury properties, generally new and spacious, which they want arranged in a harmonious and functional way. The most sought-after types of properties are centrally located apartments and apartments or houses located in green areas, close to nature, especially luxury homes, for an exclusive lifestyle. In this context, the real estate consultancy component is increasing a lot, 2 times in the last year compared to the previous period, considering that most buyers want a special property, which fulfills a series of facilities, and a personalized layout of the spaces from the desired homes”, declares Sorana Leru, co-founder and interior architect at MiSo Architects.

Both Romanians and foreigners want to buy houses in the capital, big cities or in cities with landscapes such as Brașov, either to rent them later, or to settle in the country for investments. Among the most sought after types of housing are the apartments in the central areas of the cities and the villas in the proximity of Bucharest and Brașov, which offer important advantages such as larger green areas, spectacular views, peace and much more generous areas. In Bucharest, the most appreciated areas are the north, the Aviation/Floreasca area and the central area. In Brașov, on the other hand, homes with a spectacular view of Tâmpa, surrounded by nature or in historical areas, such as the Șchei district, are more appreciated. Also, buyers, Romanian or foreign, are also interested in houses in Constanța and in localities in Ilfov county.

(Source: www.romaniajournal.ro)

This month we celebrate the impressive start of a new project: H East Residence. Our long-time partner, Hagag Development Europe, has just introduced to the market a new residential development located in the Eastern side of Bucharest, close to Veranda Mall. The project will grow in two phases, over a surface of 17,500 sq.m. Phase I will be formed of three buildings of 11 floors and one building of 6 floors, totalizing a number of 273 apartments. The entire project will consist in 7 buildings, 568 apartments, underground parking, retail spaces on the Ground Floors, and 5,200 sq.m. of parks and green areas.

Vitalis implication in this residential project is based on the vast experience that we have gained in similar projects. We will provide Project & Cost Management Services, Site Management, Site Inspection and Health & Safety Coordination. We are convinced that our team assigned to this project will deliver results beyond expectations, making this project something exclusive in the residential sector. H East Residence will be unique due to its vast and massive works developed in this area. Together with Hagag, we accomplished total success for projects like H Victoriei 109, H Victoriei 139, H Tudor Arghezi 21, and Phase I of H Pipera Lake.

Beside these that have already been delivered we are working together actively to develop H Stirbei Palace (one of the most awaited retail projects in Bucharest) and the commercial component of H Pipera Lake. Our collaboration with Hagag started in 2018 and turned into a very close partnership built on trust, professionalism, and implication. We gained huge experience together and we demonstrated what a great team we are. Let’s continue #BuildingTrust!

Romania second in the region for industrial & logistics spaces leased in Q1, report says

Romania ranked second in the region in terms of industrial & logistics spaces leased in the first quarter of 2024, after Poland, the uncontested leader in Central and Eastern Europe, according to a recent report by real estate consultancy company Cushman & Wakefield Echinox. The local demand surpassed that in Czechia, Slovakia, and Hungary.

Companies leased approximately 200,000 sqm of industrial and logistics spaces in Q1, with demand primarily generated by manufacturing companies, FMCG, and logistics operators.

The activity of manufacturing companies on the Romanian industrial leasing market was noteworthy at the beginning of the year in terms of the share of spaces contracted in the total transactional volume (17%) while overtaking logistics operators (10%) and FMCG companies (13%) for the first time, Cushman & Wakefield Echinox said. Stefan Surcel, Head of Industrial Agency Cushman & Wakefield Echinox, commented: “Manufacturing companies are becoming increasingly relevant in the industrial and logistics leasing market, partly due to the nearshoring phenomenon, but also through relocations from Western Europe or even from other countries in the CEE. These companies usually operate in their own spaces, but they also require greater flexibility due to the ever-changing consumer habits, a flexibility that can be achieved by renting other premises. We believe this trend will intensify in the coming period while the ongoing infrastructure projects will open up new areas for investments in industrial projects.”

The largest transaction closed in Q1 2024 was related to a 19,000 sqm sale & leaseback of Tenneco’s spaces in Ploiesti to WDP, followed by an 11,000 sqm pre-lease by Maravet within WDP Park Baia Mare and the new lease signed by Drim Daniel Distributie in a 10,000 sqm warehouse space in MLP Bucharest West.

Demand was mainly concentrated around Bucharest (50% of the total volume), Ploiesti (10%), and Timisoara (6%), with companies also showing interest in Iasi, Craiova, Arad, and Oradea.

When it comes to new supply, the first quarter recorded a slowdown of investments “as developers adopted a more cautious approach amid the present economic uncertainties and the decreasing number of speculatively developed projects,” the company said. Thus, only 50,000 sqm of new spaces were delivered in Q1 (compared with 100,000 sqm in the same period of 2023).

The stock of industrial and logistics spaces reached 7.07 million sqm, with vacancy rates of 6.1% in Bucharest and 5% at the regional level.

Developers currently have under construction projects with a total area of 500,000 sqm in various cities across the country, but Bucharest, Timisoara, and Brasov remain the main destinations.

(Source: www.romania-insider.com)

Office Space Demand Surges 60%, 1,000 Sq. M Transactions Lead

The office market in Bucharest has shown a sustained demand growth in Q1, both in terms of the transacted volume and of the average lease size, amid an extremely limited new supply, according to data from the Cushman & Wakefield Echinox real estate consultancy company.

Companies leased 91,000 sq. m of office spaces in Bucharest in Q1, corresponding to a significant 63% y-o-y increase. A number of 55 transactions were concluded during the analyzed period, with an average deal size of 1,657 sq. m, twice the level of recorded in Q1 2023.

Transactions pertaining to areas of up to 1,000 sq. m accounted for the largest share (65% of the total), followed by those ranging between 1,000 – 2,000 sq. m (16%). Seven deals were signed for offices with an area between 2,000 – 5,000 sq. m, while three exceeded 5,000 sq. m.

The office market in Bucharest has shown a sustained demand growth in Q1, both in terms of the transacted volume and of the average lease size, amid an extremely limited new supply, according to data from the Cushman & Wakefield Echinox real estate consultancy company.

Companies leased 91,000 sq. m of office spaces in Bucharest in Q1, corresponding to a significant 63% y-o-y increase. A number of 55 transactions were concluded during the analyzed period, with an average deal size of 1,657 sq. m, twice the level of recorded in Q1 2023.

Transactions pertaining to areas of up to 1,000 sq. m accounted for the largest share (65% of the total), followed by those ranging between 1,000 – 2,000 sq. m (16%). Seven deals were signed for offices with an area between 2,000 – 5,000 sq. m, while three exceeded 5,000 sq. m.

The net take-up had a low share (38%) in the total activity, in line with the trend observed during the past 3 years, as the major tenants preferred to consolidate their operations and renew their contracts in the existing premises. The vacancy rate has slightly decreased to a level of 14.4%, from 14.8% in Q1 2023 and from 14.7% at the end of last year. This indicator is expected to compress going forward, mostly on the account of the very limited short and medium – term pipeline.

BPO companies were the most active in terms of the leased areas, accounting for 36% of the total, representing entirely renegotiations of existing contracts. IT&C firms contributed to nearly 21% of the total volume, both through the renewal of existing premises and through new lease or relocations.

There has been no significant movement in terms of rental levels in Bucharest at the beginning of 2024, with the prime headline rent in the CBD area remaining at €22.00/ sq. m/ month.

(Source: www.romaniajournal.ro)

Mercure Hotel will soon step into the wonderful Transylvanian area

Vitalis team is currently working on a new project in the hospitality sector – Mercure Alba Iulia. The grand opening is planned for the next year, and we could not be more excited. Due to the wonderful lands and surroundings, this new hotel will be the perfect place for a well-deserved break from urban agitation. The neighborhood offers a wide range of activities of recreation, visits, and leisure.

Mercure Alba Iulia will offer guests more than 100 modern rooms, a restaurant with outdoor terrace, one event hall, playground for children and a SPA center. An aspect that should not be omitted to praise is its unique location. Alba Carolina Citadel is one of the most remarkable fortresses in Romania and is placed 3 minutes far from the hotel. Other nearby attractions are Cathedrals, Churches, Museums, and Local Parks. The entire zone is rich in historical buildings, streets, and events. Our implication in this project is to provide with the same professionalism and dedication Project & Cost Management Services and Site Management Services. Our partner here is Dentotal, an impressive developer with whom we have worked before on two other projects.

Our collaboration started in 2014 with the construction of Mercure Bucharest City Center, located in the center of the city. It was followed by one other development of Ibis Styles Bucharest City Center, close to Cismigiu Gardens. Both projects were designed in an urban & modern manner. In Alba Iulia, our team is working continuously to prepare for the very best results. We are more than happy to continue building trust in our partnerships and to be a part of this new milestone.

Romania Industrial Market Figures Q1 2024

At the end of Q1 2023, Romania’s modern industrial stock reached 7.28 mln. sq m, almost half of it being developed in Bucharest. At regional level, the West / North West industrial area, represents 23% of the country’s modern stock.

Since the beginning of the year, a new supply of 57,400 sq m in five industrial parks was inaugurated, 69% of the area being in Bucharest. Central and South regions marked new developments as well (22% and 9% from O1’s new supply).

Another 519,000 sq m could be found at the quarter’s closing in different construction stages with an estimated delivery date by the end of the year. Even though all five l&L regions will benefit from new projects, The West / North West and Bucharest regions are the largest receivers, together having 65% of the future new supply. A new trend shaping the market is the increased interest (both developers and tenants) for intermodal terminals linking railways to seaports, as Romania partially joined the Schengen area and controls at the internal air and sea borders have been lifted starting with 31st of March.

The total leasing activity (TLA) of industrial and logistics spaces in Romania during the first three months of the year amounted to 199,500 sq m, lower by 38% compared with the same quarter of the previous year and with 35% seen against 04 2023. Takeup (total leasing activity excluding renewal and renegotiations) claimed 78% of the TLA. Pre-lease deals claimed 33% of the take-up, one-third of the new demand generating developers’ start of built-to-suit projects.

Leasing deals were signed in all five industrial regions of the country, Bucharest being the main scene of the transactional activity (51% from TLA). A quarter of the total area was signed for properties part of the South region, the Central and West / North West regions attracted each a share of 10%, while 4% were contracted in the East / North East region. Logistics represented 36% of the total area, while Storage and Production jointly claimed a share of 27%.

A slowdown of leasing for Production purposes could be observed, nonetheless, this segment witnessed new entry players. In addition, the demand for l&L spaces can be correlated with the residential market, especially through the lower request for household appliances, which determine the market players’ need to occupy spaces for logistics and/or production.

(Source: www.cbre.com)

Modern office stock in Romania’s major regional cities exceeds 1 mln sqm, Cluj remains at the top

Developers completed 83,000 sqm of new office projects in Romania’s major regional cities (Cluj-Napoca, Timisoara, Iasi, and Brasov) in 2023, and the modern office stock thus exceeded the 1 million sqm threshold, according to Cushman & Wakefield Echinox Office Market Regional Cities report. The figure represents around 30% of the corresponding total in Bucharest.

Cluj-Napoca continues to be the largest regional office hub, with 340,400 sqm of such spaces at the end of 2023 (31.5% of the total), followed by Iasi, where the stock expanded after the delivery of Palas Campus (60,000 sqm) and the first phase of Silk District (23,000 sqm) to 296,200 sqm (27.4% of the total) . Next, in Timisoara, the stock stood at 293,500 sqm (27.1%), and in Brasov, at 152,200 sqm (14%).

According to the same source, the office pipeline in the four analyzed cities is very low compared with the deliveries registered in 2023, as only two projects with a total area of 26,000 sqm may be completed by the end of 2024/beginning of 2025, namely Coresi Business Campus U1 in Brasov and Paltim in Timisoara.

However, developers announced plans to start the construction of a further 170,000 sqm of new office spaces in the major regional cities in the next 5 years, out of which 75,000 sqm in Cluj-Napoca, 81,000 sqm in Iasi, and 10,000 sqm in Brasov. Among the main office projects under construction or in different planning stages, Cushman & Wakefield Echinox mentioned Silk District phase II developed by Prime Kapital – MAS RE in Iasi, the second phase of AFI Park in Brasov (AFI Europe), and NHood’s plans to add a new building within the Coresi Business Campus in Brasov.

The most important projects expected in Cluj-Napoca relate to the Prime Kapital – MAS RE and Iulius Group mixed-use developments, scheduled to be built on the former Cesarom and Carbochim industrial platforms. Vlad Saftoiu, Head of Research Cushman & Wakefield Echinox, said: “The major regional centers boast a combined enrollment of around 190,000 students (more than in Bucharest) and a workforce of approximately 550,000 employees (representing more than 50% of the level recorded in Bucharest), while the office stock in these cities is less than a third of the corresponding total from the capital city. Therefore, if we adjust these figures to the economic context of the analyzed cities, we believe that Cluj-Napoca, Iasi, Timisoara, and Brasov have the capacity to attract new companies that will generate demand for office spaces, and we estimate that another about 400,000 sqm of new projects could be absorbed by the cities in question in the long term.”

In terms of leasing activity, Cluj-Napoca has the lowest vacancy rate (6.2%) outside Bucharest, while 10.7% and 11.8% of the Timisoara and Brasov office stocks are unoccupied. Moreover, a higher vacancy rate of 20.4% is recorded in Iasi, mainly in B-class buildings.

(Source: www.romania-insider.com)

Vitalis Consulting has been an active player in the Construction market since 2006. During these years, we went through all phases of development – as a team, a company, and a partner. Our expertise in project management has grown considerably from year to year. Over time, we have achieved the success of being considered professionals in the field, but more than that, of being recognized as leaders in the market. Vitalis Consulting is a company that grew step by step and behind which stand years of work, studies, devotion, and seriousness. The first years were very important because we tried to improve ourselves and to be able to offer impeccable services. And we did it!

As #BuildingTrust is our motto, we truly believe that all of these would not have been possible without trust. We have a major trust for our team, and we know that their involvement will be at maximum levels in any project. Trust in our partners is also a special element in our success. We give and receive trust, and that’s how we create performance.

Now, when we look back, we are quite satisfied with all the history we have created, with all the projects we have been involved in and with all the partnerships we have formed. And a major satisfaction is when our work and that of our colleagues is recognized. Every year we are proud to be nominated as The Best Project Management Company of the Year.

In 2023 we won this award for the first time. It was a huge accomplishment in our portfolio, and we were thrilled to receive such recognition.

This upcoming month we will attend the SEE Real Estate Gala and will be enthusiastic to meet the most active developers, investors and professionals operating in the sector. We are looking forward to hear the new perspectives, plans and experiences of colleagues in this area. We have immense respect for all participants and nominees, as well as for the organizers that give us this opportunity to gather us all.

Bucharest among most affordable residential markets in Europe

Bucharest ranks among the major European cities with the lowest housing prices and the highest affordability ratios. The expected increases in wages as a result of the positive economic developments and also the easing of financing conditions are likely to favor house prices’ increases, a trend which will probably start manifesting itself in a more pronounced way from 2025 onwards.

Based on the public data available in regards to the average residential prices in Europe, the affordability level in Bucharest is among the highest both nationally and across the continent, with only 96.2 average monthly net salaries being required to purchase a 70 sq. m apartment. Higher levels of affordability are only recorded in Brussels and Sofia (84.2 and 94.3 average net salaries, respectively) among the major European cities and capitals. London, Munich, Paris or Zurich have some of the highest average asking prices which can exceed €10,000 (Paris) or €16,000 (Zurich) per sq. m, generally requiring more than 200 average monthly net salaries from those locations in order to purchase a 70 sq. m apartment, a level more than double compared with Bucharest.

Furthermore, the capital city of Romania also offers favorable residential prices at CEE level, with lower affordabilities being registered in Prague (the average asking prices exceed €4,700/ sq. m and 196.7 average net salaries are needed), Bratislava (171.5 salaries), Warsaw (165.3), Belgrade (161).

Data provided by the National Commission for Strategy and Prognosis and by the major international credit institutions illustrates a significant economic growth potential in the coming years in Romania, a forecast which will also translate into important wage increases in Bucharest and in the main social and economic hubs in the country. The average monthly net salary in Bucharest is estimated to reach approximately €1,600 in 2027 (+32% compared with the 2023 average), an indicator which will also have a positive impact on the housing affordability, especially against the backdrop of anticipated downward shifts of the key interest rates, shifts which will gradually begin from 2024 and which are likely to continue in the coming years.

The average asking price for a listed apartment in Bucharest was of €1,663/ sq. m in February, according to imobiliare.ro, Romania’s largest residential portal. This level corresponds to a 6.6% increase compared with February 2023 and to a 7.5% increase vs. the same month in 2022, representing some of the lowest upward price movements during the analyzed periods in the country. Bucharest ranks only third in terms of the highest average residential prices in Romania after Cluj – Napoca (€2,666/ sq. m, +10.4% vs February 2023) and Brasov (€1,815/sq. m, +14.9% vs February 2023).

(Source: www.cwechinox.com)

Bucharest recorded the highest number of residential sales in the last 15 years in December

Bucharest registered the highest number of residential sales in the last 15 years in December, according to a report by investment management company Colliers. The same report shows that a third of urban Romanians rent or share a home they do not own with parents, relatives, or friends.

Romania remains the European country with the highest number of house and apartment owners, according to official statistics, and although interest in buying a property remains high, a significant proportion continues to live in rented accommodation. 13% of Romanians aged between 18 and 55 in urban areas are renters, and around 18% share a home they do not own with parents, relatives, or friends, according to a recent survey of around 1,000 urban respondents conducted by Unlock Market Research for Colliers. Colliers has, for the second consecutive year, launched a nationwide survey in urban areas, focusing on the 18-55 age group. The results show that 69% of urban residents aged 18-55 in Romania live in privately owned homes. In general, most renters are young people aged 18-24 (25%) who have flexible jobs or are studying and cannot yet afford to invest in a home, so renting is practically their only option. Another 40% of these young people live together with family or friends.

Bucharest, Cluj-Napoca, Iasi, Timisoara, and Brasov are the main beneficiaries of internal migration and have become the fastest-growing urban centers and metropolitan areas in Europe over the last 20 years. At the same time, the number of foreigners choosing Romania in search of a better future has increased. As a result, 2022 marked two firsts: the resident population increased for the first time since 1989, and the number of newcomers to Romania outnumbered those who left (by 85,000).

This increase has placed pressure on rents. Although rents in Bucharest have risen by an average of 10% over the past year, renting remains a cheaper option than buying, according to Colliers. By comparison, rents in Warsaw and Prague have risen by between 25 and 40%. In other words, in all major regional capitals except Sofia, rent is now cheaper than bank loan rates.

Even though Romanians are interested in renting, the desire to become homeowners is still strong. Compared to other Eastern European countries, Romania is still more affordable for buyers.

Colliers’ data shows that in Bucharest, a Romanian needs, on average, the equivalent of 8 net annual salaries to buy a 60-square-meter apartment, a situation that hasn’t changed much in more than a decade, although it is slightly higher than before the pandemic, when it was around 7 years’ salary. In 2008, at the height of Romania’s property bubble, the same house would have cost roughly the equivalent of 25 years’ average annual salary.

(Source: www.romania-insider.com)

This month is marked by a major accomplishment realized by Kaufland, one of the biggest retailers that has the largest hypermarket chain in Romania. In the retail sector, everything is in a continuous expansion, and Kaufland is keeping up by developing more and more projects with a remarkable speed in the market.

In 2005, Kaufland opened its first hypermarket in Bucharest Romania, and for the past 18 years we have seen an enormous growth. Now they have more than 165 stores throughout the country, and they plan to continue expanding alongside Romania.

Today, on 29th February we are happy to witness a significant moment – The launch of a new Kaufland hypermarket in Militari neighborhood, which will be the 4th one in District 6 of Bucharest. This new project applied high standards of construction, dedication, and huge involvement. It has a surface area of 5,000 sq.m. that will host the store itself, plus 11,000 sq.m. of parking lots.

Within this project, the team of Vitalis Consulting provided Project & Cost Management Services, as well as Site Inspection and Health & Safety Coordination. By managing the process of construction, we ensured that all aspects of this project are carefully organized and scheduled to achieve successful outcomes. With a high attention to details and years of experience, our team allocated in Militari showed how a professional collaboration with a client leads to a triumph

We are thrilled to celebrate this milestone together with Kaufland Romania as we have worked together tirelessly to bring this exciting project to fruition. The opening of this new hypermarket marks another testament to our strong collaboration over the years. The partnership between Kaufland and Vitalis Consulting is a success proven by all the projects in which we worked together – Kaufland Voluntari, Kaufland Palazu Mare, Kaufland Caracal, Kaufland Urziceni and the most recent one, Kaufland Militari. The dedication, hard-work, and vision that we shared during all these projects make us truly grateful to form such a professional team. Together, we have set a new standard of excellence in the retail industry!

European, public funds push up Romania’s construction sector by 14.2% y/y in 2023

The construction work volume in Romania increased by 14.2% y/y in 2023, the statistics office INS announced.

The average annual growth rate for the sector was 13.6% per annum over the past five years. The public investment projects, logistics and industrial segment, and, to a smaller extent, a possible recovery in the residential segment (after the interest rates decrease, most likely in 2025) will keep the growth rates in the same region for the coming couple of years.

The growth rate has been robust, in the double-digit area, in each quarter last year – but it particularly peaked at 17.7% y/y in Q4.

The segment of civil engineering works, which includes infrastructure projects, was the main growth driver for the entire construction sector in 2023. The volume of construction works in such projects surged by 33% y/y in 2023.

The segment will remain highly dynamic this year, minister of economy Radu Oprea commented – pointing to the record RON 120 billion (EUR 24 billion) budget earmarked for public investments in 2024, Mediafax reported. Furthermore, minister Oprea announced that a grant scheme dedicated to stimulating the local production of construction materials will be launched soon.

In contrast, the high interest rates and households’ incomes being eroded by the high inflation dragged down by 6.6% y/y the volume of projects in the residential buildings segment.
Somewhere in between, reflecting the diverse dynamics of its sub-segments (retail, office, logistics, and industrial), the volume of construction works in the non-residential buildings segment advanced moderately by 2.2% y/y in 2023.

On a broader, medium-term perspective, each of the three segments of Romania’s construction market advanced by 13%-14% per annum over the past five years.

There was a period when the residential segment thrived (2019-2021) on low interest rates, whereas the civil engineering segment particularly advanced in 2023, and also in 2019 and 2020. Perhaps the most volatile segment has been the heterogeneous segment of non-residential buildings: it plunged from +49% in 2019 to -11.3% in 2021.

(Source: www.www.romania-insider.com)

Dealmaking In CEE Held Up Strongly In 2023, Romania Ranks 3rd In The Region

Against a backdrop of falling global M&A activity, dealmaking in Central and Eastern Europe (CEE) held up relatively well, according to a recent Mazars report.

The study, Investing in CEE: Inbound M&A report 2023/2024, offers an overview of M&A activity in the region in 2023 and looks ahead to the challenges and opportunities in the coming months.

Overall, the CEE region saw 1,097 transactions, amounting to a combined value of €37.3bn, according to the reported data and taking into account the criteria set out in the methodology.
Romania is increasingly catching the eye of investors, solidifying its position as the third most preferred destination in CEE

Despite facing significant challenges over the years, Romania’s M&A market has consistently demonstrated its adaptability and resilience in successfully navigating the obstacles encountered.

Romania ranks among the top four M&A markets in the region in terms of deal volume, gaining more and more visibility to international investors as well as developing a strong local investor base.

In 2023, Romania registered an increase in reported deal volume (110 transactions), securing the third position in terms of the number of completed M&A transactions in the region. Furthermore, the total value of these transactions nearly doubled compared to 2022, reaching approximately 4.1 billion euros. The largest deal was the acquisition of Profi Rom Food by Ahold Delhaize, a major player in the global food retail market, from the private equity fund Mid Europa Partners, for €1.3bn.

Răzvan added: “At the beginning of the year, we noticed a slowdown in M&A activity, and in the first two quarters, there was a clear decrease in transaction dynamics. However, starting from the third quarter, we experienced a revival of the market, marked by an increased number of requests for proposals and the start of numerous due diligence processes, representing a significant change from the previous period. This trend translated into a significantly higher volume of transactions in the latter part of the year, and we anticipate that this momentum will continue, generating a significant volume in the first months of 2024. Nonetheless, 2024 will be a year filled with challenges, both locally and regionally, as well as internationally. I am optimistic regarding the positive evolution of the M&A market both in Romania and in CEE, considering the maturity and opportunities it offers.”

When discussing sectors, it’s notable that the technology sector retains its position as the most dynamic, not only within Romania but also across the entire region.

“At the local level, the technology sector is followed by sectors specific to our country, such as pharmaceuticals and medical services, which, although they may not boast high-value transactions, they do demonstrate significant volume. Furthermore, noteworthy sectors include the agri-food sector, real estate, and financial services, all of which have demonstrated a good performance this year.”, mentioned Adrian Mihalcea, Director, Deal Advisory, Mazars in Romania.

(Source: www.romaniajournal.ro)