Preparing for a New Economic Crisis: Oracle Investors Seek Profit and Refuge in Romania

Investors are waiting for the new wave of economic crisis with full pockets and more new projects. The Romanian real estate market, like the international one, is speculating on the moment, regardless of specialists’ forecasts announcing a new global economic collapse. After a 2015 with remarkable real estate performance, an optimistic 2016 began with investment appetite. As usual, however, Romania is strongly competed by other countries in the region, which steal our investors with better prices or logistics.  

The year 2016 is expected to sell anything that is real estate property, but particularly in the office, retail, and industrial sectors.  These three real estate directions seem to attract the attention and funds of the world’s top-rated investors. Fortunately, Romania is one of the main investment destinations. Unfortunately, better offers from neighboring countries steal investors interested in placing money in the local economy. Poland, the Czech Republic, or Hungary are Romania’s eternal rivals in this regard. Nevertheless, Romania also has notable performances, which are marked in specialized studies.

“Romania ranks fifth in Central and Eastern Europe in terms of investment, and 2016 already shows signals of sustained growth in investment interest. The same happened in 2015, a year with robust performance, despite the fact that the total level of investment was well below the previous year. This was predictable and is explained by the particularly high performance of 2014, driven by a major retail transaction: the takeover of Real by Auchan,” states the latest CBRE report.

Romania loses ground to eternal rivals: Poland, Hungary, or the Czech Republic

Thus, in Romania, last year, a volume of 644 million euros was traded, 45% less than in 2014, which caused us to drop from third place in the top of the most traded countries. By comparison, in Hungary, the volume was 657 million euros, up 42% from the previous year, and in the Czech Republic, the volume reached 2.7 billion euros, up 33%. Poland is the leader in the field, with transactions of 4 billion euros, up 31%. In addition to the big players, competition also comes from Serbia, Croatia, Slovenia, and Slovakia, where major transactions are anticipated. Investors seem determined to strengthen their presence in these markets, which promise profit and stability – at least in the short term.

“For 2016, there are premises for strong economic growth in the region, with higher yields than those found in Western Europe. Banks are also more open to investments in this region. We expect the diversity of market players to increase, with a high presence among Asian investors,” show CBRE specialists.

Asian investors are attracted by the appetite for consumption felt in Central and Eastern Europe, a fact that boosts the retail market. Thus, until the onset of the next period of economic crisis, investors do what they know best: profit. The fragile balance in which the global economy finds itself does not allow for long-term plans anyway, which is why business plans are based on a single criterion: speculating the moment.