The Italian group Nusco, which is involved in the wood industry and real estate, has bought the Floreasca Office Building in Bucharest, a building developed by Amitim International Consult. The deal, which was sealed last month, was handled by the real estate agency CB Richard Ellis.
Due to the expected decline in yields in Romanian real estate caused by the increasing offer of office space, investors are currently trying to extract as much profit and sign as many deals as possible.
According to the real estate agency, Nusco chose to invest in the property because it offers a significantly higher yield than is expected from the market in the coming years.
The value of the transaction has not been disclosed, but, given the location and the size of the building (5,000 square metres), market sources estimate something in the region of 5 million euros. "Generally, the lack of class A properties on the market and the high level of interest in Romania coming from investment funds mean investors and agencies must be increasingly flexible in order to secure suitable investment vehicles," says Adrian Moisa, Senior Advisor with CB Richard Ellis.
The Floreasca Office Building, also known as the Amitim building, was developed by Amitim International Consult, a company involved in other real estate projects as well, such as the Jules Michelet Office Building and the Century Building.
Most of the 5,000 square metres of class A space in the building (more than 95%) is rented to multinationals such as French group Renault and Gillette.
In recent years, office buildings have proven to be preferred targets for investment by real estate players. The high level of demand from companies, especially in the case of class A office space has immediately absorbed completed buildings.
In some cases, office buildings have even been rented out entirely long before construction was completed.
Moreover, institutional investors, such as the Austrian investment funds Europolis, Immofinanz and CA Immo, have already acquired the biggest projects on the real estate market (Opera Center, Europe House and even the Iride Business Park) in transactions amounting to tens of millions of euros in each case. With the money from the sale of these buildings, almost every developer has announced other large projects that are to be completed in the near future.
Together with small and medium-sized properties, these projects will enable supply to better match demand and will trigger lower annual yields for office buildings. However, yields from real estate in Romania will continue at higher levels than those seen in neighbouring countries, which will attract other big names in real estate to the Romanian market.
ionut.bonoiu@zf.ro
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