Retailers Selgros Cash & Carry and Dedeman bought an 8.5 hectare plot of land in Drumul Taberei district of Bucharest, on which they are to develop a retail park together. The value of the plot put up for sale by developer Mivan Development stood at 40 million euros, according to sources on the market, which is one of the biggest deals of the real estate sector conducted in 2008.
Selgros and Dedeman have recently applied for construction permits for a plot located in Valea Cascadelor in the sixth sector of Bucharest, according to the local authorities. Valea Cascadelor is one of the biggest areas to shop for construction supplies in the capital city, made up mostly of small retailers, which have been affected by the development of the major DIY networks over the last few years.
Selgros and Dedeman representatives would not comment on the information. The retail park in Drumul Taberei should accommodate the fourth Selgros in Bucharest and the second store of the Dedeman network in this city.
DIY retailer Dedeman, held by Adrian and Dragos Paval, currently operates 12 stores and has previously announced it would enter the Bucharest market in 2009. It already has a project in advanced stages of development in the south of the city.
Selgros Cash & Carry, a company held by German Rewe group, the second leading player on the local trade sector, currently operates three stores in Bucharest and fourteen in big cities in the rest of the country. In 2008, the network invested 15 million euros to open a store in Braila. Half of the average investment of the company in a new location goes to the acquisition of the land, according to data provided by Selgros last year, but this percentage could be even higher in the capital.
The major store chains are becoming increasingly active in buying land on a market that is almost frozen as a result of financing problems developers are experiencing. Another DIY retailer, Bricostore, this year announced that it would co-finance stagnating retail park projects, which is a change of strategy for the French company. This is also the strategy that hypermarket operator Carrefour has been applying for a number of years.
Another important acquisition made by a retailer on the Romanian market was the takeover of the former shopping complex Prisma on DN1 (national road 1) by German DIY store chain Hornbach in 2007, for 20 million euros. The company is now in talks with several retailers to sell part of the 15-hectare plot of land that it bought in 2007.
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