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18
Colliers International Romania
Research & Forecast Report
Soft landing path ahead

Accelerating success.
1
Content

TOP 10 Economic Industrial Retail

Predictions 2018 Overview Market Market

p. p. p. p.
04 06 10 14

Office Green Investment

Market Co-working Buildings Market

p. p. p. p.
18 22 24 26

Land Hotel New tax provisions New rules for commissioning

Market Market in the Real Estate of construction works. Novelties
Industry and practical difficulties.
p. p. p. p.
28 32 34 36

2 Colliers International Romania

Research & Forecast Report | 2018

Ilinca Paun
Member of the Board
Colliers International
ilinca.paun@colliers.com
Colliers International is a leader in
global real estate services, defined
by our spirit of enterprise. Through
a culture of service excellence and
collaboration, we integrate the
resources of real estate specialists
worldwide to accelerate the success of
our partners. We represent property
investors, developers and occupiers in
local and global markets. Our expertise
spans all property sectors–office,
industrial, retail, residential, rural &
agribusiness, healthcare & retirement
living, hotels & leisure.
Dear friends and partners,
Those who don’t change their mind, never change Your real estate project must be multilocation, virtual
anything. It is Sir Winston Churchill who made this accessible, multifunction and highly accessorized by
phrase famous in his impossible situation as the comfortable services offering memorable experiences.
Kingdom’s Prime Minister of deciding between peace
And we are here to help you.
talks with Hitler or going ahead risking many hundreds
of thousands of lives of the British army. Luckily, we are
We will invest more in the professional and personal
in a safer place and our market situation is not as bad as
education of our people and we will continue to work
Europe’s war zone in 1940.
on our promise to be the most loved and respected
The lesson to learn from is that of flexibility and leaving consultancy company on the market. Some of the best
room for doubt. We get wise because we have doubts. senior experts joined our core teams in 2017, and new
Don’t make assumptions and instead have a good services were launched or scaled up. We now have a
command of deep and broad information. Learn before great balance in terms of business lines and resources
thinking you know. Because the mind that produces a spread and our top priority is to consolidate our
achievement.
problem cannot be the mind that solves that problem, too.
Today you wonder what soft landing means, how hard Colliers International Romania has had its best year since
is ‘soft’, and how you can make your investments strong 2009, with a business revenue growth of 50% in 2017,
compared with the previous year. The Office leasing,
enough to resist the wind of change. While many say
Industrial leasing and Investment Sales services brought
you should follow your heart and do what you do best
and things will be all right, I say this is exactly what you a sustainable revenue growth aligned with our focus.
should be doubtful about.
I do hope our research papers will make your lives as
investors and developers in real estate easier and our
It is best to follow your reasoning systems and have a
strict reality check process. Be your worse critic and advice will make your returns higher, while keeping a
let others appreciate you, if. Don’t build what you build focus on creating a better and happier way of living and
best, the same product, but create diversified, multi-use working for people.
spaces instead and enhance technology like never before.
I wish you a successful 2018,
A project takes 2.5 to 3 years to build and digitalization
and artificial intelligence might evolve exponentially and Ilinca Paun – Member of the Board
surprise you. Just as an example, is your project equipped
for self-driving cars? Real estate is an old school type of
business and it needs a real revolution. Online retail and
‘work from home’ policies are demonstrating that the
old criteria “location, location, location” does not work
anymore. It is much more complex now.
3
TOP 10
1
Romanian economy to
slow down, still outperform
most EU countries
After 2017’s stellar GDP expansion of over 7%, Romania
was the fastest growing country in the European
Union. It was mostly a private consumption story, though
3
Migration (internal and
external) becoming ever
more relevant
Internal migration patterns are already suggesting a
growing preference for Romania’s major “magnet cities”
– Cluj-Napoca, Timisoara and Iasi – at the expense of
exports held up quite well amid an unexpectedly robust Bucharest, with surveys further supporting this. With both

Predictions
Eurozone economy. Barring “black swan”-type risks, GDP labour and living costs lower outside the capital, companies
growth is set to slow down to a more sustainable level might be rather inclined to expand/establish offices outside
in 2018 (around 5%), given the limited room for fresh Bucharest; such patterns would also boost other segments

2018
fiscal stimulus and expected monetary policy tightening.
Romania will remain among the top performing European
economies. Consequently, the outlook for office, retail
and industrial spaces remains quite rosy.
(especially retail). A key development we will be watching
out for is if Romanians working in other countries are
starting to return home in larger numbers.

the show
2
Investment scene to steal

After 2017’s investment volumes of just under EUR 1bn,

the potential pipeline for the office segment alone could be
larger than this level. Though some deals could be delayed
for next year (as we have seen in 2017 as well), we expect
to see overall market turnover move well north of EUR
1bn, with both currently active players and new entrants
to drive up demand. Among the arguments supporting the
real estate investment scene are: attractive yield spreads
versus neighbouring CEE peers, good macro performance
and strong appetite from banks to back deals (other
funding alternatives also available).
4
Industrial segment to
continue delivering very
strong results
Despite 2017’s record deliveries of storage spaces
(around half a million sqm), the vacancy rate remained
at an all-time low of close to 5% nationwide and 2%
near Bucharest. We view the strong tenant demand as
fundamentally sound given the boost in e-commerce
and room to catch up CEE peers. Vacancy could climb a
bit amid potentially more speculative developments and
some larger tenants moving in self-developed facilities.
Meanwhile, big land banks ensure that deliveries could
continue to be elevated in 2018 (likely higher than
2017’s pace).

4 Colliers International Romania

Research & Forecast Report | 2018
 5
Infrastructure constraints
to remain in place
After 2017 saw the delivery of 24km of highways
nationwide, nearly four times below the year-start estimate
from the government, pundits are warning 2018 could be
similar. For this year, the minister is promising at least
156 km. Given the limited fiscal room in the state budget
and poor track record of EU funds absorption, we do not
expect to see a material acceleration in infrastructure
developments. That said, any positive surprises could
bring a flurry of deals/interest.
6 8
Bucharest office market to
focus on new hotspots
Deliveries look set to accelerate quite a bit in 2018 after
disappointing in 2017. Amid an expected slowdown in
terms of employment growth, vacancy is likely to move
slightly higher. The new/developing hotspots (Centre West,
Piata Presei/Expozitiei) can likely be digested organically
to a large extent, though developers are becoming much
more cautious, with the pipeline for 2018 already one third
lower than we would have thought 2-3 quarters ago.
7
Labour market becoming
quite stretched
The rate of unfilled job openings has been hovering around
post-crisis highs, while unemployment is at record lows.
Furthermore, central bank data suggest that the supply-
demand mismatch on the labour market has been on
the rise, while new bachelor graduates with a technical
background are proving too few in comparison with
employers’ requirements. This extremely competitive
labour market could limit the companies’ ability to
expand both in Bucharest and in other parts of the country
(thereby impairing office market activity – leasing and
new deliveries), though a potential buffer could come from
external migrants returning to their native country.
Balanced Bucharest retail
scene, ample room for
smaller schemes nationwide
For now, no new large projects have been announced for
Bucharest in the upcoming years, just some extensions.
That said, the consumption-driven growth has improved
household spending appetite throughout the country, so
investments will continue to focus on improving the
nation-wide coverage of modern retail, including via
medium to smaller schemes in the less populated cities
(below 100,000-150,000 inhabitants). Otherwise, the retail
market remains highly competitive, as the very low vacancy
suggests (in single digits for big shopping centres).
9
Online retail, still no
immediate threat for brick
and mortar schemes
Shopping centres are still set to deliver solid results for
tenants as Romanians have a higher predisposition than
regional peers to actually look at a certain product before
purchasing it. Still, in order to improve footfall, malls will
need to cement their status as actual destinations to
spend one’s free time. This means more space for the
food court and other services like cinemas or children’s
playgrounds (so entertainment spaces of at least 20-25%
of total GLA). A smaller per capita retail stock than in
neighbouring CEE countries could also act as a buffer for
brick and mortar schemes versus online sales. All in all, a
10
“retail apocalypse” looks like a minimal risk for Romania.
Residential segment to
remain the all-star driver
for land demand
Given the higher wages and elevated intentions to
purchase homes, residential projects are still likely to
remain the key drivers for land, though at the time of
writing, it is still too early to judge the impact of the start
of a new monetary policy tightening cycle. As we have
seen in the past, new office projects will likely draw
demand for residential projects in neighbouring areas.
Since 2018 is likely to see a large number of housing units
reach the market, players might turn more cautious and
new developments could focus on smaller projects, albeit
in prime locations when possible.
5
Economic overview
This suggests that Romania might manage to grow its way
 verheating fears
O
Landing path ahead, out of trouble to a certain extent. The external backdrop

gearing for a soft landing

remains largely supportive, with German business morale exaggerated, higher inflation
close to all-time highs early 2018 after Eurozone GDP
growth hit a 10 year high of 2.5% in 2017, with 2018 also
to help out for now
seen above 2%. Overall, we expect the good export demand, With Romania seeing such robust activity data, it is
 DP growth over 7% -
G solid rise in disposable income (both past and expected only normal to question whether or not the economy is
for 2018) and potential loan growth to keep economic overheating. One way to look at things is to keep in mind
the CEE tiger is back activity expanding at a nice pace. The material risks to our that current consumption looks much more sustainable,
Defying cooldown expectations and surpassing even the bullish growth forecast for 2018 (5.2% versus 4.1% market as it is based more on wages and less on consumer loans
most optimistic forecasts from the start of last year, the consensus as per Bloomberg surveys) derive from a erosion compared to 2007. The monthly average of consumer
Romanian economy likely expanded by over 7% in 2017. of companies’ morale or consumer spending due to elevated loans (adjusted to inflation changes) for 2017 was little
This was by far the best growth rate in the EU. It was political noise and uncertainties related to fiscal policy. over half of the level seen in 2007/2008. Furthermore,
mostly a consumption story, while supply side numbers
2012 2013 2014 2015 2016 2017E 2018F
showed a balanced picture, as a vibrant services segment
was enhanced by quite good results from manufacturing GDP growth (%) 0.6 3.5 3.1 4.0 4.8 7.2 5.2
and agriculture; the latter was especially robust and
GDP per capita (EUR) 6,700 7,200 7,500 8,100 8,600 9,500 10,300
suggests Romania might shake off previous historic
patterns with regards to agricultural results (a good year Private consumption (%) 2.1 0.7 4.7 5.9 7.4 9.1 6.6
followed by a bad one). Right off the bat, there are a couple Industrial output (%) 0.1 3.6 7.4 7.0 -3.2 8.0 7.1
of aspects worth noting: the exceptional performance was
achieved in spite of an unchanged budget deficit compared Unemployment rate (%, year end) 6.8 7.0 6.6 6.6 5.5 4.6 4.3
to 2016 – no new stimulus via lower taxes, though the Current account balance (%/GDP) -4.8 -1.1 -0.7 -1.2 -2.1 -3.4 -4.0
fiscal profile was different. Secondly, despite the economy
Net FDI (%/GDP) 1.6 1.9 1.6 2.2 2.7 2.9 3.2
expanding well above its so-called sustainable growth rate
(the potential GDP growth rate is estimated at around 4%), Budget balance (%/GDP) -3.7 -2.1 -1.4 -0.8 -3.0 -3.0 -3.0
the external imbalances have not ballooned to dangerous Inflation rate (%, year end) 5.0 1.6 0.8 -0.9 -0.5 3.3 3.6
levels indicative of an overheated economy; yes, the
current account deficit (net hard currency outflows from ROBOR 3M (%, year end) 6.1 2.4 1.7 1.0 0.9 2.1 2.8
the economy) likely swelled past -3% of GDP, but this is a EUR/RON (average) 4.46 4.42 4.44 4.45 4.49 4.57 4.65
far-cry from the nearly -14% of GDP level seen in 2007.
Data Source: INSSE, Eurostat, Colliers International

6 Colliers International Romania

Research & Forecast Report | 2018
macro fundamentals are also looking well better than a
decade ago. As things stand now, we believe the economy
is poised for a soft landing, with several factors set to
depress household disposable income towards more
“normal” levels: i) accelerating inflation (headline rate
could move towards 5% in the first semester, with state
policy changes weighing a lot); ii) expected monetary policy
tightening; iii) weaker RON to pressure import goods’
prices and those of goods/services denominated in hard
currency; iv) slowdown in nominal wage expansion as state
policies turn less generous (towards 10% from 14% last
year). Furthermore, empirical evidence like surveys that
suggest a higher appetence for saving make us believe that
consumers may have acquired some improved measure
of foresight this time around and may have not been as
reckless in their spending as a decade earlier. In the long
run, there are some reasons to maintain a cautiously
optimistic approach to Romania relative to CEE peers.
While the economic cycle does seem in a mid-to-late-ish
phase, there might still be some room to run if, for example,
investments start picking up (including absorption of EU
funds, which started accelerating end-2017) or if structural
reforms are adopted, thereby unlocking untapped potential.
For Romania, even fairly simple structural changes like
building highways would go a very long way and probably
lead to a sharp and sustainable pick-up in activity.
 rivate consumption
P 6
underpinned by robust wages
At the time of writing, we lacked the numbers for 4Q
2017, but in 1Q-3Q 2017 period, private consumption
was up by 9.5% while the overall level is, in real terms,
some 21% higher than the pre-crisis peak, reached in 3Q
2008. The double-digit wage growth (around 14%) was
the main reason behind the spike in household spending.
Government policies (minimum wage hikes and increases
in state wages) alongside a tightening labour market (tilting Productivity and labour costs as
the balance in favour of employees) have underpinned the % of Germany’s
strong wage growth. The key question here is whether
45
or not wages turn out to be sustainable in the longer run.
40
While the current situation is not ideal – it would have been 35
better to see wage growth driven more by job creation 30
rather than state policies – we believe that companies can 25
20
digest the increase. This is due to the fact that Romania 15
has a higher gap between productivity and labour costs 10
than most neighbouring peers. We also want to point out 5
0
a chart we feature in our retail section, which shows that Bulgaria Czech Hungary Poland Romania Slovakia
Republic
today’s average wage can purchase over 70% more goods
and services than 2007’s average, so people are buying
Labour costs (business economy) GDP/capita
much more with their own money, as they can afford it.
A glass half-empty approach would focus on the swelling
Data Source: Eurostat, Colliers International
imports weighing much more on GDP growth and on the
fact that capex has been quite subdued, expanding by 3.4%
in 1Q-3Q 2017. IT&C, BPO/SSC
growth rate to cool down
As expected, private services were the main driver on
the supply side, though 2017 saw a much more balanced
Unemployment rate by education level picture. Overall, in the first three quarters of 2017, IT
(%, 4Q rolling average) and BPO/SSC added around 1.3ppt to Romania’s 7%
GDP growth rate (the full year figures will be available in
9 March). In the last decade, Romania has been one of the
8
7 top beneficiaries of relocations from other EU countries
5
in IT&C, for instance. Still, employment growth for higher
value-added services is likely to be constrained in the
4
3 upcoming quarters by the lack of employees. For instance,
2 the ratio of unfilled job openings for IT&C is considerably
1
higher now than it was a decade ago, highlighting that
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 employers are finding it increasingly difficult to find the
right qualifications. Moreover, the jobless rate for people
Primary Secondary Tertiary
with tertiary education stands close to all-time lows,
around 2%, while the majority of jobseekers are those
Data Source: Eurostat
with low to medium qualifications. This mismatch between
supply and demand on the labour market is bound to yield
a few of unfavourable effects:
7
• slow down the job creation pace, a negative for the
office segment;
• pressure employers to be more generous with wage
hikes in order to keep attrition rates at tolerable levels;
• a consequence of the previous point: erode one of
Romania’s major competitive advantages: its labour cost
competitiveness.
Thankfully, besides the generous “competitiveness
reserve” we mentioned earlier, Romania also boasts a size
advantage relative to most peers and has seen the second
fastest labour productivity rise in the EU in the last decade,
after Ireland. The caveat here is that we cannot discount
for a factor that could materially change the status quo:
the potential return of Romanian migrants to their native
country. Fast rising wages have improved domestic living
standards quite significantly over the last years, especially
for those with higher qualifications, so people with
university degrees might start thinking about returning
to their native country provided that the political situation
returns to normal.
A balanced picture: manufacturing,
agriculture and tertiary sector all expanding
GDP breakdown by sector, 2017 estimate
0.5
2.2
1.2
Retail Sales, Logistics
Agriculture
Manufacturing
IT&C, BPO/SSC
Other Sectors
1.6 1.7
Data Source: INSSE, Colliers International
8 Colliers International Romania
Research & Forecast Report | 2018
Favourable outlook for
manufacturing
External demand has helped Romanian factories increase
their output significantly last year (c.9%), overperforming
greatly compared to initial estimates. The auto segment
remained a major driver, with exports growing by close
to 8% compared to 2016’s record level. As over 20% of
Romania’s total exports head to Germany, a closer look at
Europe’s largest economy could shed some light about the
domestic manufacturing segment. The good news is that
optimism regarding Germany’s economy will continue to
spill over as the widely followed Ifo Business Climate Index
is hovering around a record high. Still, we cannot be overly
confident regarding manufacturing as, on an aggregate
level, Romania still has a lot of slack, as industrial capacity
utilization is around 78%, some 5 percentage points below
the 2007-2008 average; as such, an investment boom is not
around the corner. Another negative news, in our view, is
the fact that infrastructure developments nationwide might
still continue to disappoint in 2018, as history has shown
that governments in Romania tend to sacrifice capex when
confronted with a tight budget. And indeed, this year’s state
budget has quite limited space and the Fiscal Council has
warned risks for fiscal slippages.
Financial markets gearing
up for the higher inflation
Now that the tax cuts that depressed consumer prices
are behind us and private consumption has had a banner
year, inflation has returned with a vengeance, ending 2017
at 3.3%. As such, the central bank has started last year a
new tightening cycle, at first by closing the gap between
money market rates and the key rate, then by hiking the
policy rate at the start of 2018 for the first time in a decade.
Given the inflation outlook, this is just the start and relevant
money market rates are likely to climb further (relevant 3M
ROBOR moved from a low of 0.7% in September 2017 to
2% by early 2018 and might close in on 3% by year-end).
Of course, a sharper economic slowdown than we pencil
in might mean lower inflationary pressures and limit the
need for key rate hikes, but this is not our main scenario.
Meanwhile, the consumers’ solid spending appetite has
swelled imports and dented Romania’s external balances,
but it is important to note from the start that the country
is in much better shape than a decade ago. Still, the RON
might continue to underperform regional peers this year due
to several factors:
• the current account gap looks set to widen further
towards -4% of GDP in 2018;
• higher central bank flexibility towards RON weakness –
also helping out in keeping inflation in check;
• the political backdrop is expected to remain noisy;
• elevated policy uncertainty with potential negative
surprises if the fiscal gap cannot be kept within the -3%
of GDP level.
 hanging fortunes for
C
Romania’s regional cities
With just over a quarter of the country’s GDP generated by
Bucharest, the distribution of Romania’s economic results
places it in the middle-ground between Hungary (whose
capital makes up almost half of the country’s output) and
Poland (with Warsaw’s GDP share at below 20% of total).
We believe that over the medium term, Romania will move
towards the Polish model rather than Hungary’s, meaning
we expect a material overperformance of the major regional
cities (Cluj-Napoca, Timisoara, Iasi, Brasov). We believe this to
be the case as Bucharest has become overcrowded by many
standards and this is starting to weigh on quality of life: for
instance, it has one of the most congested traffic in Europe,
according to TomTom, while, at the same time, it is in the top
10 most polluted major cities in the EU. And as some studies
have shown, millennials – probably the most important age
group for employers – tend to be less materialistic, prioritizing
experiences over “stuff”. This thesis is validated by changes
in both migration patterns and intentions.
We would normally expect this shift towards a more
balanced regional growth pattern to happen both gradually
and without negative economic consequences for
Bucharest – we do not see a contraction of economic
activity due to the new reality, rather a much faster growth
rate for Romania’s “magnetic cities”. Since we expect the
majority of people looking to change their home to be of
prime working age and with good job prospects (as they
expect to afford the moving costs), this will mean mostly
an acceleration of the services segment, offering a good
outlook for almost all real estate segments. Looking at hard
data, the net positive flow of people settling in Bucharest
Internal migration survey (%)
National survey: which city,
different than the one you live in
now, would you like to live in?
Current residents living in 15.32%/2.34%
functional urban area,
share in national population
11.88%/2.52% Cluj-Napoca
5.16%/1.34%
Timisoara Sibiu
Data Source: World Bank, Colliers International
has nearly halved versus pre-crisis highs, to just over
11,000 persons in 2016, whereas the number of people
moving to Timis, Cluj and Iasi counties has accelerated
steadily, to over 19,000 persons in 2016. While empirical
evidence might suggest that migration numbers are actually
a bit higher, we would emphasize the change in dynamics.
A World Bank report published last year found that among
Romanians, a vast majority chose “quality of life” as a main
point when looking at a potential new home, with the “job
situation” the second on the list. Gone are the days when
the capital would draw in scores of Romanians from other
parts of the country solely on higher wages.
4.3%/2.06%
Iasi
11.53%/2.27%
Brasov 14.46%/13.43%
BUCHAREST
What is even more impressive is that when asked “which
city, different than the one you live in now, would you
most like to live in”, Cluj-Napoca actually came first in the
answers, with a share of 15.3%, followed by Bucharest
with 14.5%. Timisoara (11.9%) and Brasov (11.5%) were
fairly close in migration intentions, while Sibiu (5.2%) and
Iasi (4.3%) were behind by a wider margin. That said, Iasi
is a special case as it already benefits from a big pool of
external migrants from neighbouring Republic of Moldova.
To put things into perspective, the five regional cities with
the best chances to attract migrants have a much smaller
population in total than Bucharest, but they might manage
to attract over three times more migrants as Bucharest over
the medium term. Furthermore, the people placing these
towns on their number one spot for a potential home change
is nearly five times larger than their current population.
With the World Bank expecting some 1.7 million persons to
move from one city to another within the next five years,
a validation of these internal migration patterns would
definitely spice things up for these major regional hubs
(especially Cluj-Napoca, Timisoara, Iasi and Brasov). To
summarize, out of 100 people due to move in a different city
in the next years, 48 will chose Cluj-Napoca, Iasi, Timisoara,
Brasov, Sibiu and just 14 Bucharest.
Besides the migration patterns, there are other arguments
supporting our view. For instance, given that labour
costs and other operational costs (such as office rents or
local taxes) can be materially lower outside Bucharest,
we believe companies will want to embrace the change
wholeheartedly. On the other hand, out of Romania’s over
10,000 IT&C graduates per year, Bucharest generates
almost 2,700, whereas Timisoara, Cluj-Napoca, Iasi and
Brasov stand at 5,900 together; another aspect worth
highlighting here is that only a minority of these are
willing to relocate for a job, according to local recruitment
company Brainspotting. As talent seems less willing to
move nowadays than, say, a decade ago, companies will
surely have to adapt to this new reality.
9
Industrial Market

Supply Turning to the nationwide developments, we note that

The Romanian industrial market has had a banner year
and it is only about to get better. Around half a million
sqm in new modern warehouse spaces were delivered
last year, an acceleration of over 40% versus 2016, taking
the grand total to 3.5 million sqm nationwide. Despite
the record-pace of deliveries, vacancy remained quite
subdued (below 5% nationwide and under 2% in the
Bucharest area). Overall, this is very much a landlord
market, though as developers have acquired good land
banks, things could start changing as soon as end-2018,
in our opinion.
The goldilocks market for developers/landlords is caused
by several factors, in our view: i) increased nation-wide
coverage of brick-and-mortar retail schemes requiring
improved logistics spaces; ii) e-commerce growing
Timisoara, Cluj-Napoca, Pitesti, Oradea, Sibiu, Brasov,
Turda, Bacau are also acting as current areas of interest
for developers and companies seeking warehouse spaces.
Bucharest and its surrounding areas account for close to
half of the total stock (1.7 million sqm).
Due to a lack of readily available information, our estimates
of modern stock cannot fully take into account logistic/
warehouse centres developed by companies for their own
use, though these make up for a significant part of the
market. FMCG companies used around 700,000 sqm in
storage spaces, owning around 400,000 sqm and leasing
the rest. A small part of the spaces that they own are sub-
leased, but these might grow in the future, making them
even more a direct competitor of “traditional” operators.
It is also important to note that some large tenants might
seek to build their own warehouse spaces in 2018 due
A notable investment event last year was the purchase
of Logicor by CIC, China’s sovereign investment fund, for
over EUR 12bn in a transnational deal. This also means the
Chinese company now owns Logicor’s several properties
in Romania.
Fresh developments continue to be constrained by a poor
infrastructure and, in certain areas (especially in the
western part of the country and near Bucharest), by an
ever lower workforce supply. Turning to the first factor,
Vacancy rate and industrial stock
in Bucharest
15.4% 15.3%
14.5%
13.7%
2,100,000
10.2%
1,700,000*

sharply; iii) companies seeking a better regional coverage to an attractive cost/benefits ratio (for instance, Dante
in CEE; iv) ongoing favourable momentum for the International, the company operating the largest online 1,150,000
manufacturing segment. store in Romania - eMAG.ro - is developing near Bucharest 910,000 920,000 940,000 940,000 940,000 940,000
a 120,000 sqm facility to be opened around mid-2018). 5.0% 5.0%
Almost two thirds of last year’s deliveries were in the
Bucharest outskirts; CTP and WDP were the most The trend in Romania among big companies is to buy/
2.0% 2.0%
active developers, each adding around 200,000 sqm to develop and hold, with CTP and WDP being the most
their portfolio. These developers are also the biggest in significant examples of this. Other large players have indeed
Romania, with CTP heading last year towards 800,000 changed owners over the last years, but these were part of 2010 2011 2012 2013 2014 2015 2016 2017* 2018F
sqm in storage spaces, WDP – around 400,000 sqm, transnational deals.
while the third place belonged to P3 – with around Stock (sqm) Vacancy rate (%)

370,000 sqm concentrated in a single park. * 2017 stock figure updated to include around 200,000 sqm in storage
spaces previously unnacounted for in Bucharest

Data Source: Colliers International

10 Colliers International Romania

Research & Forecast Report | 2018
just 45 km of highways were delivered between 2015
and 2017 (compared to 250 km promised by authorities)
and given the strained public-sector budget, no material
changes should be expected in 2018 at least. Besides the
substandard highway network, the low labour force mobility
for blue collar workers (Romanians have one of the highest
home ownership ratios in the EU) also suggests that areas
with a higher potential number of employees, like the north-
eastern part of the country, remain untapped. A highway
bridging either the southern or eastern part of the country
to Transylvania is still not being built, though completing it
would unlock huge potential.
Demand
Out of the nearly half a million sqm in industrial leasing
transactions recorded last year (almost 40% above 2016’s
level), just over half were in the Bucharest area (around
52%), followed at a significant distance by Timisoara
(14.6%) and Pitesti (12.4%). We want to underscore that
due to the opaque nature of the market and given the
current low vacancy, we cannot fully account for all direct
Take-up by location in 2017 (%)
3.8%
6.5% 52.0%
4.1%
Bucharest
6.6% Timisoara
Pitesti
Roman
Oradea
12.4% Cluj-Napoca
Other
14.6%
Data Source: Colliers International
leasing deals between landlords and tenants, of which we
believe there are quite a few.
Underpinning the very robust market is net take-up
corresponding to over 85% of all leasing deals, to which
we would need to add direct deals between landlords and
tenants.
From a sectorial perspective, logistics remains the largest
source of demand, having a share of 47% of all leasing
transactions; it is followed by the retail segment, which
amounted to nearly 17% of all deals, and automotive
– 9%. It is important to note that the importance of
e-commerce is likely much higher that the c.6% of leasing
transactions, as some operators likely turn to third party
logistics/distributors. Plus a lot of retailers pursue a mixed
approach to “traditional” and online sales.
In this context, with vacancies at ultra-low levels (below
5% nationally), a large part of the demand is covered via
built-to-suit schemes, with some companies even resorting
to building warehouses themselves.
The biggest leasing deals were two transactions by the
Danish transport and logistics company DSV (55,000
Take-up by sector in 2017 (%)
4% 4%
5% 47%
6% Logistics
Retail
Automotive
8%
Manufacturing
(without auto)
E-commerce
9% Distribution
FMCG
17% Other
Data Source: Colliers International
sqm and 35,000 sqm respectively) in different locations
in the western part of Bucharest. The third place belongs
to a 31,000 sqm deal by NOD (a distributor of electro-IT
products), also in the outskirts of Bucharest.
Rents
Despite the ultra-low vacancy rates, headline rents for
class A warehouses have remained roughly unchanged
for most of last year, around 4 euro/sqm nationwide.
Still, it is noteworthy that while the headline for modern
warehouse spaces in prime locations (north, western
Bucharest) previously started from 3.8 euro/sqm, this has
ticked up to 4.1 euro/sqm in 4Q 2017. As the supply had
good land banks and could quickly adapt, price swings are
unlikely to be material if current conditions hold. Besides
the developer market that could push for higher rents,
larger operational costs (labour and, potentially, taxation)
alongside increases in land prices could also exert some
upward pressures on rents. In fact, the 5 to 10% increase
in construction costs over the last year has yet to make its
way into the rents, so this could change this year.
Forecast
We expect the leasing market to accelerate in 2018, but an
increasing part of this could be the result of relocations.
As such, we forecast vacancy to move a bit higher in 2018,
especially as the developers’ plans point to a potential
acceleration of new deliveries compared to 2017’s record-
setting pace. In this context, it is worth pointing out that
major players also have adequate land banks to cover such
plans and more might seek to develop speculative logistic
spaces amid current market conditions.
Looking at the major players, CTP wants to build close to
250,000 sqm near Bucharest alone. WDP wants to more
than double its portfolio by 2020, after just having acquired
11
 Modern storage spaces
in Romania (sqm, 2017) 3,500,000 UKRAINE
Bucharest 1,700,000
Timisoara 370,000 Satu Mare Botosani
Ploiesti 280,000 Baia Mare Suceava

Cluj-Napoca 213,000 Bors

HUNGARY Salaj
Brasov 170,000 Oradea Bistrita Iasi
MOLDOVA
Piatra Neamt
Arad 90,000 2017 Cluj-Napoca A8
Targu Mures
M43 Vaslui
A11 Miercurea Bacau
2017, 2018 A10 2017 Ciuc
in 2017 a 44 hectare plot north-west of Bucharest. Arad
Nadlac A3
P3 wants to add more than 100,000 sqm to its park Alba Iulia
near Bucharest in the next two years while also
2017 Sfantu
Gheorghe UKRAINE
looking at other new parks in the central and western Timisoara Deva
Sibiu Brasov
areas of the country. Focsani Galati
A6
Consequently, we believe we will witness an A1 Buzau
Resita Braila Tulcea
acceleration in terms of new deliveries, with our call Targu Jiu
of 700,000 sqm nationwide (risks seem skewed Ramnicu Ploiesti
Drobeta Valcea
towards a higher number). Turnu Severin Pitesti Targoviste
2017
Slobozia
Demand is likely to come mostly from 3PL, though A2 A4
a closer look at the economy would suggest Slatina Calarasi BLACK SEA
e-commerce and FMCG will be at the heart of this. SERBIA Craiova
BUCURESTI
Constanta
Alexandria Giurgiu Port
While no major infrastructure developments are
anticipated, Bucharest is likely to remain at the
Legend
forefront of deliveries in 2018, though we note BULGARIA
an increased appetite for the central and western Low stock
parts of the country that can ensure swift access to Medium stock
neighbouring Hungary’s highways. If our outlook is High stock
proven wrong, the prospect of material improvements
in the rail/road infrastructure networks on the north- Existing highway
Under construction highway
south or east-west axes could unlock significant
Planned highway
untapped economic potential in certain parts of
the country, which would also generate a boom in A6 (Bucharest-Alexandria-Craiova-Calafat), A11 (Arad-Oradea) -
storage/production facilities. routes to be determined

12 Colliers International Romania

Research & Forecast Report | 2018
13
Retail Market
Supply
Little over 100,000 sqm in new modern retail spaces were
delivered in 2017 (versus around 240,000 sqm in the
previous year), making this one of the poorest years in the
post-crisis period. Nevertheless, this was in line with our
expectations. No big new projects were delivered.
Bucharest saw just a couple of extensions, which
amounted to less than 20% of the total new GLA (versus
more than 40% in 2016’s total deliveries of 240,000 sqm).
As such, Bucharest has been seeing a period of relative
equilibrium between supply and demand, a favourable
moment for the large schemes delivered in 2016 to gain
traction and settle in the domestic retail scene. That
said, Bucharest still features a considerably smaller per
capita retail stock than Warsaw and Prague (though it is
comparable to Budapest’s), so we believe there might be
room for Bucharest to absorb some new large schemes
over the medium term.
With the exception of the larger shopping centre in
Ramnicu Valcea Mall (28,000 sqm) and a significant
extension of Shopping City Galati (21,000 sqm in new
GLA) – both owned by NEPI Rockcastle, last year saw
mostly the delivery of smaller schemes and retail parks
(Prima Shops Oradea – developed by Oasis Development,
14 Colliers International Romania
Research & Forecast Report | 2018
Pascani Commercial Centre and B1 Retail Park in Bistrita
– Mitiska REIM, each with a total GLA of 10,000 sqm
It is also notable that developers have been increasingly
looking at regional cities and even smaller towns, including
or a little below this level). Extensions for two of the those with a population below 100,000 (like Bistrita or
Bucharest’s most representative schemes – AFI Cotroceni Pascani, as mentioned above) amid elevated spending
and Sun Plaza – were completed in 2017. appetite in all parts of the country. This is a trend we see
extending over the medium term.
Deliveries of new retail spaces by
city population (sqm) Demand
800,000 The cocktail of loose fiscal policy, stimulative monetary
policy (for most of 2017) and various state measures
700,000
aimed at boosting wages have led to very robust private
600,000
consumption, pushing GDP growth in excess of 7% in 2017.
500,000
In fact, consumer sentiment (as measured by European
400,000
Commission surveys) reached an all-time high early 2017,
300,000
while purchase intentions for bigger ticket items also
200,000
moved north by quite a significant margin. In fact, looking
100,000
at consumer price adjusted wages, we found out that the
0
average net wage from a decade ago would purchase just
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
around 1,400 RON of goods and services versus 2,500
RON presently; in effect, this means a growth of over three
<100,000 100,000-250,000
quarters of actual purchasing power, highlighting a much
>250,000 (except Bucharest) Bucharest
more sustainable consumption than before the crisis, as
lending also plays a greatly diminished role. Overall, barring
Data Source: Colliers International
the year-end jitters in financial markets, with money
market rates increasing sharply, it was a frantic year with
exceptional results following a strong 2016. Another detail
underscoring this is the fact that the inflation indexed
turnover volume index in the non-food retail trade was
one third above its pre-crisis peak, reached in 2008, while
printing a growth of over 13% compared to 2016.
The fashion segment was a great beneficiary of the solid
demand. Since the supply consisted to a wide degree
of retail parks in smaller towns, we noticed that the
most active tenants were still those from the budget to
medium range (Pepco, Deichmann, CCC, Jysk, TXM). It is
noteworthy that H&M, one of the strongest fashion anchors
on the domestic market, has taken its first steps into
smaller retail schemes outside Bucharest; other brands
normally seen in malls are moving to retail parks as well.
Higher-end tenants remained focused mostly on Bucharest
with a limited presence in the large regional cities, at most.
Otherwise, vacancy is likely at cyclical lows (virtually non-
existent for a lot of the successful shopping centres).
An important aspect to note is that shopping centres are
still delivering solid results for brick and mortar stores as
Romanians have a higher predisposition than regional peers
to actually look at a certain product before purchasing
it. Still, in order to improve footfall, malls will need to
cement their status as actual destinations to spend one’s
free time. This means more space for the food court and
In this respect, the food and beverage segment is
benefitting quite a lot from the strong consumer appetite,
with turnover up by close to 14% in the first 10 months of
2017 after increasing by 15% in 2016. McDonald’s remains
the largest player on the restaurant market, though
the other players (KFC, Pizza Hut, Starbucks, Subway,
Spartan, Mesopotamia) have been quite active. Companies
are also exploring new formats – like Starbucks opening
its first drive-through unit in Romania; another trend
worth underscoring on the F&B segment is an increased
appetite for larger surfaces (500 sqm or even larger).
Food anchors have also had a terrific 2017, with double-
digit growth in revenues for some in a like-for-like basis,
something quite rare for them.
Wages versus retail sales
2500
(3 month rolling averages)
2200
1900
1600
1300
Jan-07
New entries in 2017 were from a fairly wide variety, as
well as different price ranges. From fashion (Armani
Exchange, Superdry, Ninewest, INCI, Funky Buddha, AC
& CO) to sportswear (Sport Loft, Under Armour) to F&B
(Pizza Sbarro, Taco Bell). It is worth pointing out that Taco
Bell made its first step in the CEE region in Romania.
Rents
Rents have been more or less unchanged through 2017,
despite the low vacancy rates (mostly in single digit
territory for bigger schemes). That said, the rents which
include a variable component saw quite an increase amid
the vibrant consumer spending – retail sales for non-food
goods jumped by close to 13% last year. We also want
to point out that differences in rents between Bucharest
and the major regional cities are not as big as they used
180 to be, highlighting the fact that spending frenzy has been
quite widespread throughout the country. Last, but not
160
least, retailers which pay a rent with a variable component
140
seem content to pay higher rents now to compensate for a
potential future slowdown.
120
Romania Shopping Centres Average Rents
100
City Asking Rent (€ / sqm /month)
80
Bucharest 55-65

Jan-08

Jan-09

Jan-10

Jan-11

Jan-12

Jan-13

Jan-14

Jan-15

Jan-16

Jan-17
other entertainment services like cinemas or children’s Cities with more than
playgrounds. Aiming to allocate close to a quarter of the 30-40
250,000 inhabitants
Net wage (RON/month, constant 2017 prices, left scale)
total GLA could be important to improve catchment. We
also expect this trend to help out malls in their battle against Non-food retail sales (2007=100, right scale) Cities with less than
15-20
online retail, though given the current state of the Romanian 250,000 inhabitants
market, we expect both segments (online and offline sales)
Data Source: INSSE, Colliers International *Average rents obtainable for prime spaces in good performing centres
to thrive alongside over the medium term. for 100 sqm occupied by good brands;

**This represents the market average; there are big differences between
the cities depending on the level of competition;

15
 Projects to be delivered in 2018

Project Baia Mare Value Centre Project Bistrita Retail Park Project Roman Value Centre
Developer Prime Kapital/MAS REI Developer Element Development Developer Prime Kapital/MAS REI
GLA sqm 22,500 GLA sqm 15,000 GLA sqm 15,000

Forecast Project Shopping City Satu Mare Vaslui Strip Mall

Project
(extension)
The pipeline for 2018 has some 175,000 sqm in new Developer NEPI Rockcastle
GLA sqm 28,700 Developer NEPI Rockcastle
retail spaces pencilled in (we do not take into account
Satu Mare GLA sqm 2,800
standalone schemes smaller than 5,000 sqm), with Baia Mare
Bucharest accounting for less than 20% of this, with a
Bistrita
single project in the outskirts. No new big schemes are Shopping City Sibiu
Roman
Project Focsani Value Centre
Project
currently in the pipeline for Bucharest or throughout the (extension) Vaslui
Developer Prime Kapital/MAS REI
country for that matter, though we would not exclude Developer NEPI Rockcastle GLA sqm 6,400
such an announcement sooner or later. GLA sqm 16,900 Sibiu
Focsani
It is noteworthy that developers are turning their attention
more and more to smaller towns (population below Project
MIOVENI Mioveni Project Slobozia Value Centre
Comercial Centre
100,000 inhabitants), with some small- to medium- Slobozia
Developer Prime Kapital/MAS REI
Developer Mitiska REIM Ilfov
sized schemes. In the same vein, some FMCG chains Craiova GLA sqm 10,200
GLA sqm 8,800
are moving into even smaller towns, with just a couple
of tens of thousands of inhabitants. As such, it is worth
pointing out that while deliveries for the market overall Electroputere Craiova Project DN1 Balotesti
Project
remain a far cry from pre-crisis levels, the ones in (extension) Developer Prime Kapital/MAS REI
towns smaller than 100,000 inhabitants are set to be Developer Catinvest GLA sqm 28,000
comparable to 2007. GLA sqm 21,200 Data Source: Colliers International

The partnership of Prime Kapital / MAS REI, the most

active developer in 2018 based on current plans – with
new GLA close to 100,000 sqm – wants to add retail
its Electroputere mall in Craiova by adding new 21,200 established positions might try to woo clients with improved
parks and extensions in cities like Slobozia, Roman, Baia
sqm in new retail spaces, as well as an office component. shopping experiences. In fact, as the retail market matures
Mare. It will deliver one of this year’s large new additions:
A new retail park in Bistrita, by Element Development, and and expansion is no longer the primary focus, we should
a retail park just north of Bucharest, near Balotesti, with
one in Mioveni (Mitiska) round up what looks like a busier expect to see both malls and tenants seeking refurbishments
28,000 sqm in new retail GLA. Satu Mare will also attract
year in terms of deliveries than 2017. and adding a higher emphasis on client experience, also
a new mall by NEPI Rockcastle (28,700 sqm), with the
developer also seeking to extend its current schemes in On the demand side we expect to see new players trying to by incorporating more tech elements. For the moment, this
Sibiu and Vaslui. French developer Catinvest will expand enter the market (Polish, Turkish brands), while tenants with trend mostly applies to Bucharest.

16 Colliers International Romania

Research & Forecast Report | 2018
17
Office Market
  ucharest
B Demand
office market
Supply
Last year saw the delivery of 123,000 sqm of new
modern office spaces, taking the total stock to nearly 2.3
mil. sqm. This is lower than we had anticipated and also
below 2016’s 230,000 sqm deliveries, though the latter
coincided with the best post-crisis pace and was double
the average seen in the post-crisis period. Some delays
were recorded due to both an overstretched construction
segment and some developers seemingly pushing back
their projects as they seek to improve the pre-lease
percentage before the actual delivery. This coincides with
the tight overall labour market, an issue we have touched
upon in the macro section. The trend we highlighted
last year continues to hold water, with half of the total
Leasing activity cooled a bit in 2017, with total take-up for
class A office buildings at just over 320,000 sqm, down by
some 10% versus a year earlier, though this was still the
second best post-crisis result, after 2016 of course. This is
also some ways below our initial estimate, but it is still quite
a feat in itself if we take into account the increased labour
force availability constraints that emerged during last year,
limiting employers’ ability to expand. The better news is that
net take-up for class A buildings actually accelerated last
year, amounting to over 150,000 sqm in new demand or
Bucharest leasing activity peaking
400,000
(sqm)
350,000
300,000
250,000
relocations from non-competitive stock, an increase of close
to 10% and possibly the best post-crisis result.
The IT&C segment was again the single biggest driver,
generating over 40% of total leasing activity: 140,000 sqm,
an impressive growth of over 80% compared to 2016. The
outsourcing segment was also robust, so it is still safe to
assume that IT&C plus BPO/SSC operations for companies
in other sectors account for at least half of the activity in
the office market.
Looking at a geographic distribution, the established prime
locations, namely Floreasca/Barbu Vacarescu and the
CBD, took centre stage, each accounting for over 19%
of total deals. Another impressive dynamic was that of
Piata Presei/Expozitiei, set to become a new hub in the
Bucharest office market amid a hefty pipeline for the next
couple of years. The decrease in activity for Centre-West
region is bound to be temporary, considering the large
projects planned in this area.
Overall, market conditions in Bucharest are fairly neutral,
with vacancy at just under 10% at the end of last year.
Gross take-up by area (% of total)
25
2016 2017
20
15

expected deliveries coming from just two projects (the first

200,000 10
phases for Globalworth’s Campus and Forte Partner’s The
Bridge); Vastint also delivered over 30,000 sqm in two 150,000 5
new buildings in its Timpuri Noi Square. 100,000
0
Underpinning the newer hotspot in Centre-West, the two

Barbu Vacarescu

CBD

Pompeiu

Centre-West

Pipera

West

Timpuri Noi

Other
Piata Presei/
Dimitrie
50,000

Expozitiei
Floreasca/
projects delivered here in 2017 accounted for over one 0
third of total, while Timpuri Noi and Dimitrie Pompeiu each 2011 2012 2013 2014 2015 2016 2017 2018F
had a share of just under a quarter of total. Gross take-up Net take-up

Data Source: Colliers International Data Source: Colliers International

18 Colliers International Romania

Research & Forecast Report | 2018
Total take-up by sector in 2017 Bucharest Rents & Vacancy Rates
(% of total)
9%
44%
10%
IT&C
Consumer goods Baneasa
Professional Services 11-13 8-10
11%
Finance / Banking /
Insurance
10% 33%
Energy / industrial Pipera
Other
15-16 D. Pompeiu
12% 5%
11-13
Piata Presei/Expozitiei
14% 8%
16-18
2% 14-16 Floreasca
Aviatorilor 3% Barbu Vacarescu
Data Source: Colliers International
16-18
11%
Still, developers have acquired a good land bank for future Victoriei
projects by 2020, that are set to yield well over half a million P.Poenaru 14-15 Romana 13-14
10 9%
M
10%
sqm if constructed. Otherwise, the same mantras are still Grozavesti
Pacii 4% Eroilor
true: good access to the public transport infrastructure, Universitate Piata Muncii
higher quality buildings, an interesting mix of amenities. With Politehnica Izvor Unirii 12-14
companies having ever more difficulties in maintaining good 14-15 14%
15% Vitan
attrition rates and in attracting new talent, the workplace
Timpuri Noi
itself has become a differentiating factor. As such, given the
heavier delivery calendar announced for the next couple of
years, we consider that higher tier properties might see less Eroii Revolutiei
11-12
downward pressures on rents than lower tier ones, as some 21%
companies might be willing to shell out a bit more money to Piata Sudului
keep their employees happy.
Rents
Rents were broadly stable throughout 2017 and we expect
this trend to continue in 2018. Still, as vacancies start
climbing a bit and planned deliveries remain significant,
we could start seeing some downward pressures on rents
towards the end of the year (it could also mean showing
n Average headline rent (€/sqm)
similar headline rents and more flexibility regarding
n Vacancy rate
incentives for tenants).

19
 Forecast
We expect to see some 185,000 sqm in new class A office
spaces this year. It is worth highlighting that developers
are turning a bit more prudent, as the figure is over one
third smaller than the figure we would have estimated
for 2018’s pipeline some 2-3 quarters ago. Currently,
companies would love to hire more people, but their demand
cannot be matched by the current workforce supply, as
unemployment for people with tertiary education is close
to all-time lows. We also cannot take into account potential
disruptions stemming from unforseen fiscal changes as
the government’s limited budget room might yield some
unpopular measures. The tight labour market suggests that
activity may have peaked in 2016-2017 on the Bucharest
office market, but there are a couple of footnotes here. For
example, we cannot say precisely what will happen with
external migration patterns, as higher domestic wages might
actually start drawing back some of the Romanians that
2017 deliveries and pipeline by area (sqm)
75,000
50,000
25,000
0 other than Bucharest. Still, a solid pipeline for 2018 (47,000
Centre-West
Pompeiu
Barbu Vacarescu
CBD
Piata Presei/
Dimitrie
Expozitiei
Floreasca/
Data Source: Colliers International
20 Colliers International Romania
Research & Forecast Report | 2018
migrated in previous years, offering a boost to the office
market. Due to labour market constraints, we would expect
the Bucharest leasing market to cool down a bit this year:
we forecast total take-up at around 300,000 sqm, with net
take-up at 135,000. This would take overall market vacancy
towards 12% by end-2018.
New large-scale projects offer opportunities for companies
with a large domestic footprint to consolidate their offices
in Romania and developers might be pressed to offer the
new tenants options for both expansions or downsizing in
the future.
With the public transport infrastructure stretched to its
limits in the northern part of Bucharest, developers are
expanding the Centre-West’s stock and exploring new
hotspots in Timpuri Noi or Piata Presei/Expozitiei. The
latter still offers material untapped alternatives given the
plans for a metro line extension in that area, as well as still
holding large swaths of unused land (potential for a couple
2017
2018
Timpuri Noi
West
of mixed-use projects with an office component). Overall,
currently announced projects (most with construction
works yet to commence) add up to half a million sqm,
mostly in Centre-West and Piata Presei/Expozitiei.
 Regional cities in focus
We have been arguing that it is high time for regional cities
to steal the limelight from Bucharest, supported by internal
migration patterns (see pages 8-9), and developers seem
to be gearing up for this. Though the current modern office
stock in the major regional cities altogether (Cluj-Napoca,
Timisoara, Iasi and Brasov) is currently some 3.5 times
lower than in Bucharest, the pipeline in these cities for
2018 stands at almost 150,000 sqm versus Bucharest’s
185,000 sqm.
Taking a closer look at these cities, Cluj-Napoca has been
rivalling Bucharest in terms of complexity of the services it
can cover, based on workforce competence. The north-
western region of Romania, led by Cluj-Napoca, has been
recently crowned by the Milken Institute as the fastest
growing in the EU in terms of hi-tech services expansion
in recent years. The city’s university is ranked as the
best in Romania by several institutions, while start-up
rates among youths are comparable to Bucharest’s, even
though its population is well smaller. Innovation, growing
entrepreneurship culture and skilled graduates make
Cluj-Napoca highly attractive for IT rather than lower-tier
BPO/SSC services. Cluj’s very low vacancy on the office
segment (below 5% end-2017) makes this very much a
developer market and land availability constraints mean
a limited pipeline over the medium term, even though the
town would be the most interesting proposition in Romania
sqm – mostly from UBC Riviera and Hexagon’s project)
should alleviate these pressures a bit.
Timisoara remains an interesting alternative due to its
mix of opportunities. Firstly, its proximity to neighbouring
Hungary’s infrastructure means it has attracted quite a lot
of attention on the industrial segment (unemployment Romania’s main office markets
among low-skilled labour-intensive jobs at cyclical lows).
Modern office stock 160,800 sqm
On the other hand, in the Ministry of Education’s ranking Pipeline, 2018 12,000 sqm
of domestic universities, Timisoara had 3 universities Vacancy 7.75%
in the top 20, the same as Cluj-Napoca and Iasi and a Modern office stock 204,200 sqm
Average rent 10.5
whisker behind Bucharest, which had 4 universities. Pipeline, 2018 47,000 sqm
Average wage
Vacancy 4.75% 432
Timisoara’s engineering university ranks second in (county level, EUR)
Average rent 12.0 IT&C graduates
the country behind the one in the capital, highlighting 1,500
Average wage per year
again quite good skills for employers. Its office vacancy (county level, EUR)
521
stood at just 3% by end-2017, though it should increase Modern office stock IT&C graduates
steadily as it has the biggest pipeline among the major
126,800 sqm
per year
1,900 Iasi
Pipeline, 2018 74,000 sqm
regional cities (mostly due to the Openville project, one Vacancy 3.00%
of the biggest mixed-use schemes in Romania, but also Average rent 12.0 Cluj-Napoca
other large projects like ISHO Offices, Bega Business Average wage
522
(county level, EUR)
Park or VOX Technology Park).
IT&C graduates
2,000
The town of Iasi, in the north-eastern part of Romania, per year Modern office stock 117,500 sqm
offers some advantages over the longer run. Internal Pipeline, 2018 15,000 sqm

migration patterns and the youngest population among Timisoara Vacancy 13.00%

the major economic hubs suggest it should continue to do Brasov Average rent 10.0
Average wage
well for years to come. Though it does not rank as highly (county level, EUR)
450
as Bucharest, Cluj-Napoca or even Timisoara in terms IT&C graduates
500
of service output complexity, it could certainly climb up per year
in the next years thanks to its high-quality universities
and – still – better labour force availability. Taking these
arguments into account, the city has been drawing
increasing attention from BPO/SSC companies and it won BUCHAREST
Emerging City of the Year at 2018’s CEE Shared Services Modern office stock 2,3 mil. sqm
and Outsourcing Awards Gala in Poland. Pipeline, 2018 185,000 sqm
Vacancy 9.75%
Brasov, though the smallest office market of the major Average rent 14.5
hubs in Romania, is quite an attractive opportunity over Average wage
651
the medium term, provided it will have an airport soon. (county level, EUR)
It is also interesting that Brasov outranks Timisoara and IT&C graduates
2,700
per year
Iasi in terms of the percentage of population with tertiary
education. This means a large pool of talent waiting
to be tapped as operating costs (both rents and labour
costs) are considerably smaller than for the other cities. Data Source: INSSE, Colliers International, Brainspotting

21
Co-working
Global number of coworking members
Co-working: mixing the (millions)
new and newer 6.0
5.1
5.0
4.5
4.0 3.8
3.1
Entrepreneurs, freelancers and companies are starting 3.0
to come to terms with a new type of deal, whereby, for a 2.3
2.0 1.7
premium price, they can occupy a workspace for exactly
the period of time they need, with everything included, 1.0
1.0 0.5
from wi-fi to security to espressos and even craft beer.
0.0
The antiquated “serviced office” is starting to make way 2015 2016 2017 2018 2019 2020 2021 2022
for the trendy “co-working” space. Though this might not
Source: Emergent Research
seem obvious at first, even large companies are joining
in, with WeWork, one of the largest players in the shared of operators (Impact Hub, Regus) generated over 2%
office market globally, saying that over one fifth of its in gross take-up activity for class A office in Bucharest
spaces is occupied by companies with more than 1,000 compared to much more modest numbers in previous
employees. As such, this trend is proving far more than years. Peering into the future, we believe that in about five
a transitory fad and we expect this revolution to come years, shared work spaces will come to have a material
quite fast to Eastern Europe as well. To paraphrase Ernest share in total take-up, of at least 10% per year nationwide.
Hemingway on this, change tends to happen nowadays The potential supply for shared service spaces in Romania
“gradually, then suddenly”. need not come just from high rises, as quite a lot of
unconventional buildings (like former factories or other
Today’s co-working facilities in Romania can barely
industrial assets in urban settings) can be refitted into
accommodate a couple of thousands of members
posh destinations.
nationwide, while in Bucharest, such spaces (including
hubs) represent just around 1% of the total modern office There are several reasons why we believe this change will
stock. Still, there has been a pick-up in activity, as a couple take place. Even when looking past the global migration
22 Colliers International Romania
Research & Forecast Report | 2018
towards the so-called gig economy, Romanians are
seeming keener than ever to start flying solo, with the very
strong GDP growth numbers to act as catalysts. The most
recent surveys from the European Commission do highlight
the fact that Romanians have a higher appetence towards
opening companies, with around one in four actively looking
into this, double the average share in the EU.
20-29 30-39
years old years old
Number of people
holding shares in 123,618 348,679
companies (end-2017)
Increase in number of
28,296 81,809
shareholders since 2015
Source: ONRC
We are already seeing an interesting pattern emerging,
with around 28,000 people under the age of 30 years
old becoming shareholders in companies in the last two
years, taking the grand total for this age group to almost
124,000 people. For the 30-39 years old category, the
number of shareholders expanded by around 82,000, to
nearly 349,000 persons. It is impossible to say how many
of these were opened companies for tax optimization
purposes, but it is still an impressive growth rate. These
young companies with generation Y shareholders ought
to greatly boost demand on the co-working scene in the
medium term.
As work becomes less dependent on one’s physical
presence somewhere, flexibility will be something sought
after by both employees and companies. For instance,
we can imagine that among company-offered benefits,
like gym/private healthcare subscriptions, a similar
arrangement with a co-working network/space would not
be an uncommon sight; this need not be with a single large
operator, as we can imagine that smaller players/hubs
can form alliances, for instance. Since there are probably
hundreds of thousands of people working in Bucharest, but
born in other cities, we think they might welcome being
able to work close to their relatives a couple of months a
year. This could also work wonders in a town as crowded
as Bucharest as working closer to home in a shared work
space might save people the hassle of commuting in one of
the most crowded towns in Europe. Other advantages for
employees might include a better sense of empowerment
and control, increasing job satisfaction.
We would normally expect Bucharest to spearhead
the development of co-working in Romania and this is
something which we are currently seeing, as the shared
service operators are renting considerably more space
in the capital. Still, regional cities not lag too much in our
view, particularly as we argue in the macro section of this
report that these are favoured demographically thanks to
both recent migration patterns and intentions.
For companies, the advantages of co-working can also
be quite significant. Besides the increased flexibility (for
instance, temporarily bringing in freelancers to handle a
sharp rise in the workload), various studies have shown
that such spaces can improve overall productivity. Shared
workspaces can also expose the business to new clients,
while, at the same time offering “traditional” companies
a closer look at the so-called disruptors or other creative
individuals; this would be even more the case for niche hubs
(shared biolabs, women oriented spaces, writers’ spaces,
industry specific spaces). Such locations can also provide
“swing spaces” for multinationals in case of relocations, for
instance. Since some large banks like HSBC or tech-giants
like Microsoft have moved part of their employees into
co-working spaces, we think that arguments like potential
security issues are certainly not insurmountable.

23
Green Buildings
Introduction
As the office market continues to mature in Bucharest and
offers an enticing growth outlook for the major regional
cities, the standards also continue to improve. What
we noted a year ago still stands true today: developers
are increasingly focused on the efficiency and long-
term sustainability of their buildings, while tenants are
also becoming pickier when choosing a location. CSR
requirements for domestic foreign-owned companies
mean an increased attention to environment friendliness
and resource efficiency throughout a building’s whole
life cycle, from planning to construction to operation. As
such, green certifications have become almost mandatory
for a successful high tier real estate project. We continue
to collaborate with developers/landlords to obtain green
certifications, both for BREEAM (Building Research
Establishment’s Environmental Assessment Method) and
LEED (Leadership in Energy and Environmental Design)
standards. This study is based on official data derived from
the certification bodies for LEED and BREEAM standards.
buildings (around the 50,000 sqm GLA) were certified
during last year, taking the grand total towards 1.7 million
sqm of projects – built or in various stages of execution –
with green certifications. This would suggest that the total
surface of green certified office buildings is around half of
the nationwide total. Around 200,000 people currently work
in office buildings that have been deemed to have sufficient
energy efficiency and to be sustainable in the long run.
Basically, every new office building will seek a green
certification as this is almost a mandatory requirement for
a good positioning on the market. Meanwhile, older office
schemes, say, from a decade ago or even older, are also
seeking to obtain green certifications for existing/in-use
projects in order to remain attractive for tenants.
Green certifications in 2017 by sector
8%
31% 61%
Office
Retail
The most certifications (24 or 61% of total) were for
office buildings, though the overall share has decreased
compared to previous year as developers from other
categories of developers are seeking to have a green
stamp on their building. The number of retail-certified
buildings grew (12 or a share of 31%). A hotel and two
mixed-use projects rounded up the grand total.
Another change relative to 2016 is the predominance of
certifications for in-use buildings, which accounted for
over three quarters of the market last year.
Incorporating new technologies is also becoming
important, with more and more buildings seeking to
provide tenants with charging stations for electric vehicles.
A mid-2017 Colliers analysis showed that some 20% of
class A office buildings in Bucharest offered facilities for
electric vehicles, while another 21% were incorporating
such technologies.
The current pipeline remains quite solid, as there are
currently 47 buildings seeking LEED certifications,
whereas this time a year ago, there were 40 certifications
in progress. That said, we would expect the market to
slowly taper in several years, as most of the older projects
will have received their green certifications by then.
Total number of green certifications
35
BREEAM LEED
30 29
25
25
20

 Green certifications Other 15

10
9 8
market in a nutshell 10

5
5 6 6 6
4
2 1 1
Last year saw 39 green certifications obtained by 0
0

Romanian buildings, both buildings yet to be delivered and 2011 2012 2013 2014 2015 2016 2017
those already in use. This an increase over 2016’s already
record-setting result of 29. Meanwhile, several large office Data Source: Colliers International Data Source: Colliers International

24 Colliers International Romania

Research & Forecast Report | 2018
Either way, the market has had a phenomenal period BREEAM / LEED - regional distribution of certifications (sqm)
recently, coming from a total of buildings with green
certifications of below 100,000 sqm before 2011 to over 535000 BREEAM LEED
3 million sqm last year.

Regional split
As real estate projects outside Bucharest have increased
greatly in the last years, so too has interest in green
1149000
certifications in 2017. While Bucharest has nearly 1.7
million sqm in LEED or BREEAM certified buildings, the 161000

other regional cities put together neared this level and 129000
we would expect that by the end of this year or 2019, 340000
216000 53000 46000
these could surpass the capital. 111000 55000 103000 93000 20000 25000 21000 21000 14000 11000

Bucharest

Cluj-Napoca

Timisoara

Ploiesti

Targu Mures

Sibiu

Iasi

Pitesti

Constanta

Drobeta Turnul
Severin

Buzau

Deva
Brasov
Data Source: Colliers International

Quality of certifications Existing BREEAM/ LEED - Tax incentives

We are noting an improvement in the overall quality,
Quality of certifications Offering tax incentives could provide a further boost
with fewer and fewer buildings achieving a low level of to the green certifications market, as well as raise the
certifications; this highlights improvement in building BREEAM Certification LEED Certification
overall building standards. Cluj-Napoca and Timisoara
standards and a growing internal competitiveness for remain the only significant office hotspots to offer a lower
the real estate space. 2017 brought two of the highest property tax (a reduction of as much as 50% if they
Outstanding Platinum
ratings on the LEED scale, namely “Platinum”: one for 3 achieve one of the higher levels of certifications). There
Globalworth Tower in Bucharest (the first one for a new Excellent 1 Gold is talk that other cities, notably Iasi, are thinking about
construction) and a pre-certification for the AFI Tech Park Very Good
31 Silver 21 offering similar fiscal incentives, but no decisive steps
project on former Inox platform. The rest were “Gold”, 56 have been made in this direction.
Good Certified
with no lower LEED ratings assigned during last year.
Turning to BREEAM, while no building achieved Pass 5
12 2
the „Outstanding” rating, last year still marked an 1
improvement, with nearly 45% of ratings being „Excellent”
and 52% achieving „Very Good”. Just one project was
assigned a „Good” level of certification. Data Source: Colliers International

25
Investment Market
Prime yields 2017 Romania
Investment market
Overview
Bucharest Warsaw Budapest Prague
Investor interest in Romania has strengthened thanks
Office 7.25% 5.15% 6.00% 4.85% to the robust economic growth (the fastest in the EU
Retail 7.00% 5.25% 6.20% 5.00% by far), increased appetite from domestic banks to fund
transactions, high-growth potential for various segments
Industrial 8.50% 6.50% 7.75% 6.25% of the real estate market (especially office and industrial)
and a fairly generous yield differential compared to most
Data Source: Colliers International CEE countries and to western EU states.
Liquidity neared the EUR 1bn mark in 2017, despite some
large office deals have been postponed towards 2018 due
CEE Investment market to a lengthier negotiation phase. As such, actual turnover
stood at around EUR 960mn, some 5% above 2016.
2017 was an exceptional year in eastern Europe. Last Looking beyond administrative hurdles and delays, 2017
year, investment volumes in CEE-6 (Visegrad countries saw a qualitative improvement of the market compared to
plus Romania and Bulgaria) stood at just below EUR 13bn, 2016 as investor interest broadened and the number of
some 6% higher than 2016 and 47% above 2015. It is also deals increased.
the best result since 2007. We saw some notable entries via transactions: Atterbury
Amid stronger consumption-driven growth, the retail Europe, Cerberus Capital Management and China
segment stole the show with 39% of total and office Investment Corporation, with the latter part of a large
trailing with a 27% share; industrial deals also slowed a transnational deal (the biggest private equity real estate
bit. Yields continued to move largely south, with Prague deal in Europe). Still, we highlight that both recently active
and Warsaw still seeing the closest yields to developed investors and those that remained passive in recent years
western markets, while Bucharest is still regarded as have shown interest in snatching up new assets (CTP,
riskier, but a high-growth potential alternative. Smartown Investments, Globalworth, GTC, Mitiska).
26 Colliers International Romania
Research & Forecast Report | 2018
Transactions and Investors
The year’s biggest deal was the partnership between
Iulius Group (owner of several malls outside Bucharest)
and Atterbury Europe, with the latter acquiring 50% of the
Romanian company’s shares for an estimated EUR 200mn.
Another large ticket was the purchase of Radisson Blu Hotel
Bucharest for EUR 169mn by the US company Cerberus
Capital Management and the regionally-focused Revetas
Capital. These two deals accounted for 38% of 2017’s total,
but overall, last year saw a more balanced mix of the turnover.
The retail segment was the major driver this year, accounting
for just under 40% of the total turnover; besides the Iulius-
Atterbury deal, another notable transaction was Mitiska
purchasing almost a dozen smaller schemes in various parts
of the country for almost EUR 80mn. There was also some
appetite for distressed assets, as evidenced by the sale of Era
Shopping Park Iasi, purchased by Prime Kapital/MAS REI for
EUR 45mn.
The Immochan purchase of Coresi Business Park in Brasov for
around EUR 50mn was the biggest deal on the office segment,
marking a notable push towards regional cities by office
investors. Another noteworthy deal involved the third building
of Skanska Green Court by Globalworth for EUR 38mn.
The highlight on the industrial side was the China Investment
Corporation transnational Logicor deal, with the value of
the four parks in Romania estimated at close to EUR 80mn.
Globalworth’s purchase of the Dacia-leased warehouse near
Pitesti for EUR 42.5mn was another important transaction.
CTP consolidated its position as the largest industrial space
owner by concluding four investment deals amounting to
approximately EUR 40mn.
Pricing
The increased interest for domestic assets has been placing
ever more upward pressures on prices, with some prime
office properties receiving offers at 7.25% (down from 7.50%
a year earlier). Prime retail yields were flat in the last year,
Investment turnover (EURmn) reflect more closely the favourable macro trends. For Similarly, liquidity on the industrial market is set to improve as
instance, sovereign default swaps/CDS or 10 year Eurobonds players vie for market share against the backdrop of increasing
1000 show smaller differences with regional peers, with the latter demand for production and warehousing spaces. Activity
900
showing Romania c.1.25ppt higher at most than Poland, on the retail segment will be more subdued, but there is a
800
Czech Republic or Hungary. This trust deficit has constrained consistent pipeline of projects coming to the market. Overall,
700
demand in the real estate space, particularly on the office we expect the volume on the investment market to surpass the
600
segment. However, 2018 is set to be a turning point as EUR 1bn mark, a post-2008 maximum; we would expect any
500
the type of assets that will come to the market will change surprises to be rather to the upside.
400
significantly. Whereas the average size of transacted office
300 A materialization of the expected increased competition for
buildings from 2015-2017 was approximately 20,000 sqm,
200 Romanian assets should lead to lower yields across the board.
the current pipeline of office projects to be traded between
100 As such, we could see a 25-50bp yield compression for
2018-2019 has an average size well above 50,000 sqm. This
0 office, industrial and retail segments over the next year and a
2010 2011 2012 2013 2014 2015 2016 2017 change on the supply side coupled with renewed interest
half, provided the macro backdrop remains fairly constructive
Hotel Industrial Office Retail from investors should result in a sharp increase of liquidity
and domestic political noise remains at acceptable levels.
in the market. Our estimates indicate that the total volume
Source: Colliers International
of office investment transactions could increase from EUR
at 7.00%. Prime industrial assets, with the best positioning 160mn in 2017 to well above EUR 500mn during 2018.
and long duration of leases, saw their yields drop towards
8.50%. However, as the market is becoming increasingly Prime yields: current versus pre-crisis lows (%)
more nuanced, projects with attractive commercial terms and
Prague 5.75
features are looking to receive better pricing. 4.85
Budapest 6.25
Meanwhile, the banks’ interest for funding real estate deals 6
has been on the rise, with central bank surveys among the Warsaw
5.15
5.75
top lenders suggesting a low risk perception is predominant. Office 5.5
Bucharest
7.25
Margins remain lower than they were in previous years 4% 5% 6% 7% 8% 9%
(250 basis points for prime properties), while stable and low
2007-2008 minimum
Euribor rates offer further comfort, though strong Eurozone Prague
5
5.5
End-2017 level
growth suggests the low rate environment might be slowly Budapest 6
6.2
drawing to a close. Other funding options, like bonds, offer
Retail Warsaw 6.5
alternatives for investors to choose the most appropriate 5.25
solution for a specific deal. Bucharest 7
7
4% 5% 6% 7% 8% 9%

Forecast Prague 6.5

6.25
While investor sentiment towards Romania has improved Budapest 6.75
7.75
markedly during 2017, transactions have lagged behind. We 6.5
believe there is a perception issue regarding Romania for the Industrial Warsaw
6.5
real estate market’s participants, as other financial markets Bucharest 8
8.5
4% 5% 6% 7% 8% 9% Source: Colliers International

27
Land Market
Demand
The land market just ended its best year in the last decade,
with the overall value of transactions for real estate
projects (office, retail, residential or mixed-use, without
industrial segment) increasing by an estimated 25-30%
relative to 2016, reaching around EUR 350mn. Some two
thirds of the grand total came from deals in Bucharest.
With the residential segment accounting for close to half of
the transactions in the capital, the rest was almost equally
split between retail and office.
Keeping up with the pattern seen in recent years,
demand for land plots aimed at residential projects was
focused on areas near office hubs. As such, the most
active areas were the Centre and North of Bucharest:
Bulevardul Expozitiei, Bucurestii Noi and the Baneasa-DN1
- Jandarmeriei area - due to the future office hub in the
Expozitiei area, but also the Floreasca-Barbu Vacarescu,
Aviatiei and Pipera areas. The improved interest in the
residential segment is also helping deals close in other
cities. The vibrant economy, good disposable income
growth and low interest rates (for most of the year) have
pushed home purchase intentions towards post-crisis
highs, as European Commission surveys show. For now,
it is still too early to say how the start of a new monetary
policy tightening cycle and renewed political noise will
impact the morale of consumers, but we would believe that
the residential segment will continue to do fairly well as
the average consumer’s purchasing power has increased
28 Colliers International Romania
Research & Forecast Report | 2018
greatly in the past few years (please look at the retail
section of this report for a chart showing the dynamic of
the CPI-adjusted net wage in the last decade).
The office cycle led to a significant boost in interest for
land acquisitions, as developers wanted to establish a
good land bank for the next couple of years. This was the
result of a fairly robust office leasing market, especially
in Bucharest and, to a lesser degree, in the four major
regional cities: Cluj-Napoca, Timisoara, Iasi and Brasov.
The land deals likely lead the office development/leasing
markets. In Bucharest, the Expozitiei area saw the biggest
total turnover, followed by central areas (Calea Victoriei).
Looking at demand-side forces nationwide, it would seem
that the crown passed to the retail segment last year. This
has been seeing strong interest throughout the country,
maybe a bit less for Bucharest. Demand is coming both
from retailers and developers of retail parks, aiming for
both smaller or larger schemes. Currently, retailers are
still having to fill gaps in poor coverage of modern retail
schemes throughout the country, including in smaller cities
with population below 100,000. We note interest from
food retailers (discounters, hypermarkets), DIY, furniture,
cash&carry and others.
The highlight of the year was the sale of Policolor-owned
land in the eastern part of Bucharest (nearly 14 hectares
bought for around EUR 22m by Raul Ciurtin, ERES);
this deal strengthens an already existing retail hotspot,
though it is likely to become a mixed-use project, with a
residential component as well. This transaction and others
are also emblematic of another trend: the appetite for
large surfaces, as developers achieved confidence that
the market can digest ever bigger projects (for instance,
residential developments with over 1,000 units). Still,
internal challenges and an increased number of residential
deliveries in 2018 might lead to a more cautious approach
in the future for big projects.
The newly-found strength in the real estate space has led
to the „re-activation” of some large investors that had been
dormant until now on the land market; this increasingly
competitive market has supported both asset prices and
made it easier to close deals. 2017 also saw the entry of
quite a few new players, which acquired land plots mostly
for residential developments.
Supply
The market has absorbed the excess supply in recent years,
influenced by distressed owners who wanted to liquidate
their assets in a limited timeframe. Given the favourable
backdrop, several large owners (Immofinanz, Telekom, Plaza
Centers, Trigranit) continued to sell their portfolios – either
individually or in bulk. Some are exiting the market, but for
the most part, companies are seeking to dispose of non-core
assets and focus on their main activity/real estate segment.
The supply is still influenced by former factories within city
boundaries. Fabrica Industria Iutei, Policolor, Tricodava in
Bucharest and part of Roman Brasov are some notable
examples of sales seen during 2017. A solid pipeline for
future projects will continue to come from such former
industrial assets in urban settings.
We also note an increasing number of partnerships
between land owners and developers (mostly for
residential), with the former putting forward the actual land
and the latter dealing with the project in all its intricacies,
including funding.
 Prices 2017 Bucharest Land prices
in major transactions
While price hikes in 2015 and 2016 were seen rather on
a case-by-case basis, 2017 marked a more generalized
increase in asset valuations. We estimate that land prices Pipera
moved north by some 10-15% nationwide. Dynamics were ¤ 75-275 /sqm
quite varied, with some cities and even parts of Bucharest
seeing little to no price changes. That said, there was
increased interest for central areas of Bucharest, as well as Aviatiei - Dimitrie Pompeiu
areas that are strategic for the office submarket, including ¤ 500-1,500 /sqm
Bucurestii Noi
in Romania’s emerging regional powerhouses on this ¤ 270-450 /sqm
segment (Timisoara, Cluj-Napoca, Iasi). For some smaller
Expozitiei Barbu Vacarescu
land plots in Bucharest’s central areas, last year also saw
¤ 350-1,000 /sqm ¤ 600-800 /sqm
prices in excess of 2,000 EUR/sqm, a level reminiscent of
Lacul Morii Stefan cel Mare
the pre-crisis period, not of recent years. Smaller cities, Regie Orhideelor
¤ 200-250 /sqm ¤ 700-750 /sqm
meanwhile, have barely started to close deals, which is, ¤ 400-550 /sqm
Iuliu Maniu - Preciziei Calea Victoriei
nevertheless, a progress if we consider that there was
¤ 120-150 /sqm ¤ 1,000-2,200 /sqm
little interest from buyers in previous years; this means
these markets saw no meaningful upward pressures on Unirii
Razoare Progresului
¤ 600-850 /sqm
prices, though on a case-by-case basis, it is possible that ¤ 250-600 /sqm Marasesti - Carol Park
some transactions (in prime/unique locations, for instance)
¤ 600-650 /sqm
closed at higher prices than in previous years. eodor Pallady
¤ 100-160 /sqm

Forecast
2018 is shaping up to be just as dynamic as 2017, with
several large deals currently in various stages. Still, as Berceni
the active developers have acquired a good land bank ¤ 120-250 /sqm
(especially for office and residential), they might focus
more on bringing their real estate projects to the market
rather than looking at new locations. This means that new
demand might be a bit poorer than last year’s. Appetite
for larger surfaces might also suffer a bit for residential
projects as the market is set to receive an increased
number of units this year. Moreover, developers might The information is based on the deals closed or secured in 2017 and not
turn a bit more cautious due to internal challenges related, average asking prices for the specified areas. They highlight the most
for instance, to the higher RON interest rates constraining targeted type of land plots. As usual, the prices were influenced by size,
disposable income or uncertainties about state policies. destination, building parameters, status of the permitting process.

29
Bucharest is likely to retain its top spot in terms of
attractiveness, but the major regional hubs (Cluj-Napoca,
Timisoara, Iasi) are increasingly popping up on the radar,
as office and residential projects still see good interest
from tenants/buyers. In addition, we expect investors
to still show interest with regards to retail schemes in
towns with low coverage of modern retail. Otherwise, as
land plots without adequate permits still carry significant
risks, we believe transactions will continue to focus on
those with zoning/construction documents.
Given the adequate supply, we would not anticipate any
significant land price swings. Another aspect worth
pointing out is that strategic/central locations should still
do better as current asset valuations are less „bubbly”
than they were a decade ago and projects in prime
locations are more appealing for developers.
We do not expect any major infrastructure developments
to positively and materially influence the market (the metro
extensions in Bucharest continue to progress slowly).
Residential segment
The home ownership ratio in Romania stands at over
90%, the highest rate in the EU and some 20% above the
member states’ average. The figure might be swelled a bit
by under-reporting of tenants amid tax evasion, but such
numbers suggest it would be more appropriate to judge
the market from somebody actually using the apartment
rather than somebody seeking potential returns from an
investment in a housing unit.
This leads us to the central and most relevant aspect, in
our view: disposable income has risen sharply in the last
decade, whereas housing prices are still well below their
levels in 2007-2008. To put things into perspective, today’s
average wage can buy two thirds more goods and services
than the 2008’s average, while, on the other hand, the
asking price per square meter in Bucharest, for example,
is nearly half its level recorded a decade ago. A useful
indicator to look at is the ratio between an apartment’s
price and the average annual net revenue. For Bucharest,
this ratio has dropped some nearly three times in the
last decade. This means a great improvement in both
affordability and sustainability of the market.
The price-to-income ratio for Bucharest also looks better
than most CEE capitals in the region (like Warsaw, Prague
or Budapest).
In order to analyse market risks periodically, the European
Central Bank came forward with several econometric
models to look at over/undervaluation of residential
properties in the EU. The ECB’s main model shows that
while Romania had some of the most overinflated asset
prices in 2007-2008, it now has the most undervalued
residential property prices in the EU. Of course, such
an approach does not lend any attention to regional
differences, but it nevertheless offers a precious insight.
On the other hand, in a sign of strong demand keeping
up increased deliveries, the share of units sold/booked
off-plan has increased. While some years ago, the
percentage stood at around 20-30% for a lot of projects,
nowadays, residential schemes are reporting that they
manage to sell in excess of 50% of their units before the
project is finished. Despite this, the average price growth
for apartments has been more or less in line with that of
disposable income.

still not “bubbly” Price-to-income ratio (years to purchase a 60sqm

As the residential projects are a major driver of the
apartment in Bucharest with the average wage)
demand for land, we feel there might be some merit 25.0
to look at the emerging concerns regarding the market
overheating. Talk of a new residential bubble surfaced 20.0
in 2017 as housing prices were shown to be rising in
double-digits in certain parts of the country/in certain 15.0
neighbourhoods, while the central bank repeatedly
expressed its concerns related to the expansion pace 10.0
of mortgages. To start off, we think that such fears
are overdone as things stand currently and we see the 5.0
market to be in much better shape fundamentally than it
was a decade ago. 0.0
1Q08

1Q09

1Q10

1Q11

1Q12

1Q13

1Q14

1Q15

1Q16

1Q17
Purchasing a house is definitely one of the lifelong
priorities many Romanians share and seems to be
deeply embedded from a cultural standpoint. Data Source: Colliers International

30 Colliers International Romania

Research & Forecast Report | 2018
31
Hotel Market
Market Overview
In tune with the macro trends, the hotel market in Bucharest
continued to improve in 2017. It is still mostly geared
towards business, with the leisure and MICE (meetings,
incentives, conferences and events) still quite subdued.
All segments are likely expanding, with a robust outlook as
well, including for the leisure segment. It is noteworthy that
Bucharest made its way into Booking.com’s top 10 up-and-
coming destinations tourists should visit in 2018, calling it a
„new to the alternative city break scene and a great option
because of its museums, parks, trendy cafés and mix of art
nouveau and modern architecture.”
The number of foreign visitor arrivals in Romania’s hotels
and other accommodation options grew by over 10% last
year, towards 2.8 million persons, with almost half of these
in Bucharest. This remains well lower than CEE peers (who
receive at least 2-3 times more foreign tourists per year).
Romania is host to nearly 1,600 hotels, with the number
increasing slightly from year to year. The average
occupancy rate throughout the year improved marginally,
to 37.4% from 37% in 2016, which is one of the best levels
in the post-crisis period. Besides the steady rise in foreign
visitors, we note that the robust increase in disposable
income for Romanians has led to an increased spending
appetite, with the transition towards services only natural.
Highlighting the favourable outlook, we note that quite a
lot of airports in Romania reported very positive results. In
32 Colliers International Romania
Research & Forecast Report | 2018
the EU, among the ones in the 10-25 million passengers
per year category, Bucharest’s Henri Coanda airport was
5th in terms of growth last year, expanding by 16.7%, to
12.7 million passengers. Meanwhile, Cluj-Napoca’s number
of passengers grew by close to 50%, to 1.9 million. The
constant increase in new destinations (both national and
international) remains a key aspect to look out for.
The duration of stay in Romania remains fairly low, at
2 nights on average for foreign visitors, highlighting the
fact that the country benefits mostly from business trips
(likely over 70% of total hotel business for Bucharest) and,
to a lesser extent, city break status. The capital city also
became a more sought-after leisure destination, which
materialized in a higher share of the demand generated by
the leisure segment, moving towards 20%. The average
expenditure per trip stands at around 470 euro per person
per trip, with the bulk – little over half – represented by
accommodation expenses.
Supply
Romania seems to be one of the attractive emerging
markets for new players in the hospitality industry:
Bucharest has little over 8 room beds in hotels per 1,000
inhabitants compared to over 14 for Budapest and nearly 27
for Prague. Also, close to 45% of the hotels in the capital
city are branded, compared to an average of around 60%
for the major CEE cities like Budapest, Warsaw or Prague.
The Bucharest hotel market remains the most competitive
in the country, with several international chains consisting
the biggest players: Radisson Blu Hotel (over 760 rooms
with 3 brands), Hilton (around 560 rooms with three
brands), JW Marriott (just over 400 rooms), followed by
Sheraton and InterContinental Bucharest (both with under
300 rooms). Overall, there are close to 150 hotels with
more than 12,800 rooms, with the premium segment (4
and 5 stars) accounting for close to half.
The Garden Inn by Hilton in Bucharest’s old town, with
201 rooms, was last year’s notable addition, though a
Courtyard hotel (Marriott brand) has been announced in
the north. The French company Accor has also secured
a development land and might announce a new project
fairly soon, while it likely retains additional interest. In this
respect, it is important to note that Accor-owned Orbis
Hotel Group announced previously that it plans to become
the largest player in Romania.
Demand
Businesses travellers continue to be the prime clients of
high-tier establishments (4 and 5 stars), while the leisure
tourism usually heads for hotels lower down the cost range.
The average daily rate (ADR) increased in 2017 by close
to 10% in local currency terms for 5-star hotels, to reach
96 euro in the second part of the year. This remains 10%
to 40% lower than that of the major regional capital cities.
Highlighting the preference for higher-tier establishments,
the ADR for 4-star hotels saw a growth rate around half
that seen by the 5-star ones, reaching around 66 €.
The average occupancy for the 12 months ending
September 2017 stood at around 75-76% for both 4-star
and 5-star establishments, an improvement of some 2-3
percentage points over the previous year. As such, thanks
to both the higher ADR and improved occupancy, the
average revenue per room saw in excess of 15% growth in
the second part of the year, even in months that were not
marked by exceptional events like the Enescu Festival.
develop on this segment without adequate multi-purpose
venue centres, which it currently lacks.
The office hotspots (like the northern or central-western
parts of Bucharest) hold potential for fresh hotel
developments. So does the Old Town, which is likely to
see some new brands (no necessarily new companies)
opening hotels via refurbishments of old/historic buildings;
this area has a potential for some 500 new rooms to come
to market in the upcoming years. Another event expected
Passengers on board, arrivals to Bucharest airport (million, 2016)
on the Bucharest market is the refurbishment of Lido
Hotel, expected to be finalized sometime in 2018.
As far as trends go, the hospitality segment is starting to
diversify: we are noting an increase in interest for brands
geared towards leisure tourism, as well as mixed concepts
(like flexible rooms, with rental of beds rather than rooms).
We might also start seeing projects geared at certain
niches, like students or blue-collar workers.

Forecast
As the outlook for the market remains quite optimistic,
companies are seeking solutions to expand their network.
While the traditional and potentially cumbersome
management contract is not viewed as an attractive
solution currently, new solutions are emerging. Some Great
higher-tier brands might be seeking to buy or invest Britain
Netherlands Germany
alongside developers, offering the latter an exit option if
need-be. Another solution that could help the domestic Belgium 0.5 1.2
market growth might be a “rental contract”, with a hotel
1.3
built by a local company then handed over to a hotel brand 0.4
for a fixed instalment.
France Austria 0.4
With Bucharest’s office stock expanding constantly over the Romania
last decade and foreign investments continue to pour in, we 0.6 (other towns)
continue to see room for the hotel market to grow on the
business segment. Underpinning this aspect is the renewed 0.9
investor interest for this segment, with last year seeing a
2.0
couple of smaller hotel deals and the largest transaction on
this segment so far in Romania: Radisson Blu, bought for 0.9 Italy
EUR 169m by a Revetas / Cerberus partnership. 0.4
The leisure segment retains a bright outlook as well, as Spain
highlighted by Bucharest’s growing appeal on specialty Greece
websites like Booking.com. Still, Bucharest cannot fully

33
New tax provisions in
the Real Estate Industry
Alex Milcev | Head of Tax & Legal
EY Romania
 orporate income
C able to deduct the entire exceeding borrowing costs during
tax aspects
Deductibility of financing costs
As of 2018, a corporate income taxpayer’s exceeding
borrowing costs (i.e. the amount by which deductible
borrowing costs exceed taxable interest revenues) in
relation to various types of financing (including e.g. bank
loans, inter-company loans, finance leasing, etc.) may be
deducted for corporate income tax purposes only up to
10% of the company’s EBITDA, adjusted for tax purposes.
This EBITDA limitation will be applied to those exceeding
borrowing costs which are above an annual threshold of
EUR 200,000 (i.e. the first EUR 200,000 would not be
subject to the limitation).
The above measures are transposed from Council Directive
(EU) 2016/1164 of 12 July 2016 laying down rules against tax
avoidance practices that directly affect the functioning of the
internal market, known also as Anti-Tax Avoidance Directive.
34 Colliers International Romania
Research & Forecast Report | 2018
The investors should analyze the impact of this new
measure from two perspectives:
• 10% EBITDA: Even if the Directive gives the possibility
to the EU Member States to choose a limit up to 30%,
Romania opted for only 10%. Clearly, the real estate
companies recording a small EBITDA or in the investment
phase will be affected by this limit as they might not be
the period they are incurred.
• Bank loans: Unlike under the interest deductibility
restrictions until 31 December 2017, the interest related to
bank loans is now included and subject to the same rules
mentioned above. As the bank loans represent one of the
main source of financing for real estate industry, this new
measure will have a significant impact for the Romanian
real estate companies.
N.B: As of January 2018, there is a draft amendment law replacing the
EUR 200,000 threshold with EUR 3,000,000 and 10%-limit with 30%.
Micro-enterprise tax regime
Any company with a turnover below EUR 1 million / year
(compared to EUR 0.5 million applicable in 2017) has the
obligation to declare and pay micro-enterprise tax instead
of corporate income tax. The micro-enterprise tax is 1%
or 3% depending on whether the respective company has
employees, applied to the turnover.
Investors should be aware that the tax loss incurred by a
company, during the period in which this mandatory regime
is applied, is not taken into account nor can be used to offset
future profits. In other words, newly set-up companies
during the investment phase (when usually the turnover is
below EUR 1 million) or operating companies with a small
turnover, will not benefit from the tax loss generated by the
expenses incurred.
N.B: As of January 2018, there is a draft law re-introducing the option
to apply the regular corporate income tax regime if the companies
have a minimum subscribed share capital of RON 45,000 and at least
2 employees. Until it is adopted, deduction of any expenses will be a
concern for all companies with turnover less than EUR 1 million.
Investors should also consider the following tax aspects that
did not change in 2018:
Rental income
Rental income is included in the taxable profits of the
companies and subject to a flat 16% corporate income tax.
Dividend income
Distribution of net profits is taxed with a 5% dividend tax.
However, there are situations when the tax can be reduced to
nil (e.g. via tax treaties, EU Parent-Subsidiary Directive).
Capital gains
Capital gains obtained by Romanian companies from disposal
of Romanian real estate properties are subject to a 16%
profits. The taxable gain is determined as the difference
between the selling price and the fiscal value of the fixed
assets sold. In the case of depreciable fixed assets (buildings),
the deductible fiscal value is defined as the entry value/
increased revaluated accounting value less fiscal depreciation.
As an alternative, the shareholders of a Romanian company
can opt to sell the shares of the company rather than selling
the company’s property. In this case, they are liable to the 16%
income tax applied to the capital gain obtained through the
company sale. In certain situations, based on the provisions
of the tax treaties, sale of shares held in Romanian companies
may be exempt from tax in Romania.
 Individual tax aspects
Rental income
Although the income tax drops to 10% (from 16%
applicable in 2017), there is an increase of the health fund
contribution from 5.5% (as applicable in 2017) to 10%.
However, the health fund contribution is due only if the
taxpayer obtained in the previous year rental income (and
other types of income, except for salary) above 12 national
minimum wages. Starting with 2018, the health fund
contribution if due is capped at RON 2,280 annually.
The taxable income is determined either (i) by deducting a
40% deemed expense quota from the gross income or (ii)
by the single entry bookkeeping.
Taxation of real estate transactions
The real estate tax, due by the taxpayer on the transfer of
the property right or its divisions either buildings or their
related land, or land without constructions, is maintained
at the level established in February 2017, as follows:
• tax exemption for a sale amount up to RON 450,000
(approx. EUR 100,000); and
• 3% income tax applicable on a sale amount exceeding
RON 450,000.
Dividend income
The tax rate on dividends distributed to individual
shareholders is 5%.
The withholding tax for non-resident individual
shareholders could result in a more favorable rate, if a
double tax treaty is applicable.
The main taxation impact results from the increase of
the health fund contribution rate to 10% (as compared to
5.5% applicable in 2017). Similar conditions in respect
of the contribution due should be observed as in case of
rental income.
Capital gains from disposal of shares
Starting 2018, 10% flat tax rate is payable on the net
capital gain from sale of shares (reduced from 16% as
applicable in 2017). Health fund contribution is due as for
the dividend income.
VAT aspects
Rental of real estate property is normally VAT exempt.
However, any taxable person performing rental activities
may opt to charge a 19% VAT on such transactions (such
option allows deduction of VAT on related costs).
As a rule, the sale of old buildings/parts of buildings and
the underlying land, as well as of any other type of land
is VAT exempt without deduction right unless the taxable
person performing such transactions opts to tax the sale
with 19% VAT. This exemption is not applicable to sale by a
taxable person of a new building or building land. Special
rules are applicable for buildings and land registered under
one single cadastral number.
A 5% VAT tax rate is applicable for the sale of social
housing (including related land) under certain conditions
(i.e., houses of maximum 120 square meters and not
exceeding RON 450,000 in value - net of VAT). Individuals
trading in real estate as a business are to be treated
as taxable persons. Thus, when performing taxable
operations (e.g. sale of new buildings) the individuals are
liable to register for VAT purposes if the volume of their
transactions exceeds RON 220,000.
VAT split payment mechanism
Romania introduced the VAT split payment mechanism
in 2018. The mechanism involves special accounts for
transfer of VAT funds and a system of restrictions and
sanctions related to such funds.
A tax rebate of 5% of the profit tax / income of micro-
enterprises is available to taxpayers that elect to apply the
VAT split payment mechanism.
Other VAT related aspects resulting in certain
cash-flow benefits:
• The supplies between two VAT registered taxable
persons of real estate (land and building) subject to
Romanian VAT by option or by law are subject to VAT
simplification measures under certain conditions.
• The VAT adjustments can be performed for every year
during which the real estate is used for VAT exemption
without deduction right transactions instead of one-off.
• Mergers and spin offs are by default out of scope of VAT.
• Romania implemented the VAT Group rules under
certain conditions which allow the consolidation of the VAT
position (payable/refundable) of the VAT Group members.
Local tax aspects
The local tax for non-residential buildings due by
companies continue to range from 0.2% to 1.3% applicable
to the taxable value (for building tax purposes) of the
building as at 31 December 2017. The local council may
increase this tax with up to 50% of the normal rate.
Moreover, a higher building tax rate of 5% is applicable for
buildings which are not revalued for more than 3 years.
The land tax is established by taking into account the
number of square meters of land, the rank of the locality
where the respective land is situated, as well as the area
and/or the category of use of the respective land, as
established by the local council.
Additionally, there are certain cases when judicial stamp
duties apply (e.g., in court, etc.). In the case of real estate
transactions, notary and Real Estate Register fees apply
(in total approximately 1%, depending on transaction value).
35
New rules for contracting construction.
Novelties and practical difficulties.
Oana Bădărău | Partner | Pelifilip
Alexandra Ioniţă | Associate | Pelifilip
One of the changes of 2017 with significant
legal impact in real estate was the enactment
of a new regulation on commissioning
of construction and installation works
applicable since July 2017.
The new regulation reiterates part of
the previously applicable principles on
commissioning of construction works and
includes provisions designed to align the
new regulation with other normative deeds,
including ones on fire safety and energy
performance matters.
Moreover, the new regulation includes several
material changes which are likely to impact
both process and timing in commissioning of
real estate projects.
36 Colliers International Romania
Research & Forecast Report | 2018
Significant changes
Suspension of commissioning of
construction works
Perhaps the most important amendment included in the
new regulation refers to the range of decisions available to
the commissioning committee. As novelty, the committee
may recommend to either suspend, approve or reject the
commissioning of the works. However, it appears that
the committee may no longer propose the approval with
objections.
The committee decides to suspend the commissioning
in the following cases (substantially, the previous
“postponement” grounds):
• non-compliance, inconsistencies, defects or
deficiencies which affect the use of the construction works
for their intended purpose;
• construction works which are inadequately performed,
incomplete or not performed, which may affect the basic
applicable requirements;
• defects for which the remediation is lengthy and
strictly necessary to ensure the use of the construction
works in accordance with their intended purpose;
• the existence of reasonable suspicions on the quality
of the construction works performed and the need for
technical survey, trials and additional tests to clarify such
suspicions; or
• the developer does not provide the commissioning
committee the documents required under the law.
In case the committee suspends the process, the minutes
will also include a remedy term for the flaws, which must
not exceed 90 days. Should the contractor not perform
the remedy works within the set term and still fail to
comply with this obligation despite being notified, the
developer may perform the remedy works by itself, on the
contractor’s cost and risk.
However, the new regulation does not lay out the steps
to follow the suspension and completion of the remedy
works. Under a reasonable interpretation, the entire
process will resume from the contractor’s notice aiming at
convening the committee. However, in case the developer
performs the remedy works, the contractor would
presumably not be in the position to dispatch the notice.
Decision-taking process
As a rule, the committee takes decisions with the majority
of its members’ votes.
However, the new regulation provides two exceptions:
a) deadlocks are handled by giving a casting vote to the
representative of the local authority which issued the
building permit; and
b) in certain significant projects (e.g. high importance
class buildings, tall constructions, historical monuments,
publicly funded works etc.), the recommendation of
certain special participants to reject commissioning takes
precedence; these are (a) the issuer of the building permit,
(b) the State Inspectorate for Construction Works (in
Romanian: “Inspectoratul de Stat in Constructii”), (c) the
county directorates for culture/Bucharest Directorate for
Culture, (d) the county/Bucharest-Ilfov inspectorates for
emergency situations. However, it is not clear whether the
issuer of the building permit enjoys such veto right under
normal circumstances.
Summoning within the validity term of the
building permit
The contractor initiates the commissioning process by a
notice to the developer, setting forth the date of completion
of all works related to the parts/elements/sectors of the
building and including the contractor’s request to proceed
with the commissioning.
As novelty, the contractor must send the notice during
the validity term of the building permit. This addition is
welcomed as it undermines a well-established practice
requirement (which was yet to be backed by an explicit
legal provision) that the commissioning of the construction
works must be carried out while the validity term of the
building permit has not elapsed.
However, the legislative gap on the manner in which the
process will be resumed after commissioning is suspended
leaves a question mark of whether the new/second notice
of the contractor must also be dispatched before the expiry
of the validity term of the permit.
Additional matters It would appear that an employee of a legal entity
contracted by the developer as advisor on construction
to be considered matters would not qualify as member of the commissioning
committee, which seems more of an oversight than the
Energy certificate
intention of the legislator.
The developer, owner or administrator of a building
Delays of the authorities
undergoing commissioning must present to the
commissioning committee the original version of the While scheduling the commissioning process, developers
energy performance certificate. A copy of the certificate should also consider potential delays of authorities in
will be annexed to the commissioning minutes, in lack of issuing various documents. For example, before convening
which the minutes are deemed null and void. the committee, the developer must obtain a confirmation
of receipt of payments by the State Inspectorate for
Following the enactment of the new regulation, the
Construction Works. We are aware of several recent cases
provisions on commissioning were partly correlated with
in which the State Inspectorate delayed the issuance of
the ones regarding the energy certificate, by including
this document, and such delay reverberated on the overall
the obligation of the committee to check that the energy
calendar of projects.
certificate is available.
However, the new regulation does not go as far as
specifically stating the obligation to attach the energy
Way forward
certificate to the commissioning minutes (as set forth While commissioning is a critical milestone on the way to a
under the specific legislation on energy performance of completed and functional building, the construction may be
buildings). In practice, the members of the committee are used only once the relevant permits have been obtained (e.g.
often unaware of such obligation, leading to a critical title fire permit, civil protection permit, operating permit etc.).
document being opened to potential validity challenges.
All in all, the new regulation comes with certain
Furthermore, developers should also be aware that some clarifications/novelties welcomed in a field compelled by
authorities require that the energy certificate is registered public interest grounds to be highly regulated.
with the relevant local council as a prerequisite to
commissioning.
Members of the committee
The commissioning committee will include one to three
construction specialists with expertise in the relevant
works; these cannot be individuals involved in the design/
performance of the construction. The new regulation
requires that the construction specialists must either be
employees of the developer or authorized persons, acting
based on services agreements.
37
Contact our experts

Laurentiu Lazar Silviu Pop Robert Miklo

Managing Partner Head of Strategic Analysis | Research Director | Investment Services
+40 722 308 309 +40 741 698 655 +40 728 988 830
Laurentiu.Lazar@colliers.com Silviu.Pop@colliers.com Robert.Miklo@colliers.com

Stefania Baldovinescu Sebastian Dragomir Laurentiu Duica

Senior Partner Director | Office Advisory Director | Industrial Agency
+40 723 711 522 +40 734 303 158 +40 737 554 973
Stefania.Baldovinescu@colliers.com Sebastian.Dragomir@colliers.com Laurentiu.Duica@colliers.com

Ilinca Paun Simina Niculita Sinziana Oprea

Member of the Board Director | Retail Services Associate Director | Land Agency
+40 722 589 323 +40 723 187 919 +40 726 153 295
Ilinca.Paun@colliers.com Simina.Niculita@colliers.com Sinziana.Oprea@colliers.com

Raluca Buciuc
Director | Valuation Services
and Hospitality Advisory Services
+40 724 290 922
Raluca.Buciuc@colliers.com

38
39
554 offices in About Colliers International Group Inc.
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Colliers International <<Romania>>
Floreasca Business Park
billion square feet 169A Calea Floreasca, Building A, 7th floor
under management 014459 Bucharest, Romania
Phone: (40-21) 319 77 77

15,000 Fax: (40-21) 319 77 78

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Copyright © 2018 Colliers International.

The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has
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40 Colliers International Romania
Research & Forecast Report | 2018