Dan Ioan Popp, the main shareholder in Impact real estatedeveloper with 32m-euro market capitalisation, describes 2009 as a"painful year", during which Romanian entrepreneurs remained on amarket where almost nothing sold, while foreigners abandoneddomestic projects.
"We witnessed the departure of foreigners, who held 25-30%,maybe even 40% of the market, which angered us. They ebbed outafter they flowed in," says Popp, who considers new apartmentprices dropped by around 20% from the highs of 2008, now standingat the level of 2006.
Popp, Valentin Visoiu (Conarg), Negoita brothers or Ion Avram(Can Serv) are among the Romanian entrepreneurs who have built thehighest number of housing units after the revolution, with Impactowner holding more than 1,000 finalised units in his portfolio. Inthe past two years, the real estate market has turned from a driverof the economy into one of the hardest hit fields, with declines ofabove 50% and with no major housing project started in 2009.
Impact turnover in the first nine months of last year contractedby 62% year-on-year, to a level of 41.4m RON (around 10m euros),while the company's income went down from 16.8m RON (4m euros) to0.79m RON (200,000 euros) during the same interval.
Dan Ioan Popp believes the entire economy is hindered by thehigh borrowing costs. "Banks should now have zero interests. A yearfrom now, we'll see, but the longer interest rates are kept high,the more banks are standing to lose. (...) Unfortunately, it isbanks' shareholders, and not bankers that are deciding now oninterests. And now, 98% of the banking system is no longer inRomanians' hands. Banks must be saddled," Popp stated.
Impact's most important project now is being carried out on a60-hectare plot of land of Baneasa district, in northern Bucharest,on which more than 2,000 housing units should be built in severalstages. "We're preparing a concept we believe is really suited tothe market. We'll provide beneficiaries with flexible solutions ofthe "do it yourself" or "a la carte" type (...)" Pop says.
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