Last year, real estate deals revolved around 2bn euros, however, the start of the year was poor in terms of the movement of assets, after several investors saw their funds dry up, while banks became much more reluctant to finance real estate projects.
Still, acquisitions sealed by Deutsche Bank and DEGI, investors that signed deals worth 500m euros in May, indicate that large funds' appetite for the Romanian market remains high and solid projects will still find buyers.
The volume of deals concluded in the first half of the year is not higher than 1bn euros, but consultants believe that this year will bring a new record on the investment market, as was the case in the past 3-4 years.
"The investment market is following an upward trend, also confirmed by recent transactions. By yearend we'll overshoot the investment volume of 2007," believes Bogdan Georgescu, manager of Colliers International consultancy, the most active player on the market.
Clinching a deal worth hundreds of million euros can take around six months.
As a result, several players think the market is frozen right now, while the recently sealed deals were started a long time ago, when the fallout of the global real estate crisis was not strongly felt in Romania.
"(...) The conclusion I draw is that the market is starting to mature," states Dan Borbely, a partner of Tuca Zbarcea & Asociatii law firm.
The most active buyer of real estate assets domestically, Austria's Immoeast, stated that it intended to cut down on investments in Romania because of tougher access to financing.
However, a series of strong players, with assets worth tens of billion euros and low exposure on the markets seriously hurt by the subprime crisis, will continue to make significant investments in Romania.
"I think speaking of a crisis on the market is a mistake. In fact, I think that Romania is no longer viewed as an 'El Dorado', where virtually anybody could get rich from real estate, and an era of 'industrialisation' will follow, during which only well organised structures, holding not only financial, but also human and know-how resources will be able to develop, build and manage the projects they become involved in," stated Borbely.
The hardest hit segment of the real estate market in the first half of this year was that of land sales, in the context where a large part of developers have already secured their plots for future projects and prices had reached, as early as last year, levels that make real estate developments economically unfeasible.
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