RED Management Capital, with a 350m-euro portfolio on the domestic market, which includes 22 properties, is present in Bucharest only through a partnership for a housing complex.
Despite being one of the most dynamic shopping centre developers outside Bucharest, the company, held by US and Spanish funds Warburg Pincus and GED, as well as by managers holding minority stakes, has not started a project of this type in Bucharest, where the population has the biggest purchasing power. "No matter how much I calculate, because of the high land prices in Bucharest figures do not add up when I think of a shopping centre in Bucharest. It is not our strategy to erect tall buildings, so that it is even more difficult. However, as the market rate has slowed down this year, opportunities may emerge," Andrew Stear, managing partner and shareholder in the firm, told ZF.
The complete development of the company's current portfolio entails investments put at over 1bn euros.
Current land prices are turning Bucharest projects into less profitable investments compared with other cities and the high number of investors who voiced their intention to build in Bucharest is turning shopping centre projects into an even riskier business.
Stear has been present in Romania since 1996, being one of the pioneers of the Romanian real estate market, where he was involved in the development of IRIDE project, whilst the new company, RED, finalised its first project this spring. Just like in the case of the projects the firm is developing in Constanta and Baia Mare, after they are built, properties will be transferred into Immoeast's portfolio.
Besides Austria's Immoeast, another traditional partner of RED is Carrefour hypermarket chain, present in Armonia Arad, but also one of the future tenants in the projects in Braila, Constanta, Satu Mare, Baia Mare and Giurgiu.
Apart from large shopping centre projects, RED is also developing a small retail network in cities such as Husi and Marghita. At the same time, Iasi is an important point on RED's investment map.
The only project RED is developing in Bucharest, in partnership with Spain's Grupo Lar, is Natura Residence.
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