REAL ESTATE IN ROMANIA
The Romanian real estate market had a very good year in 2022, as all segments performed well in a context characterized by the uncertainties caused by high inflation and financing costs and also by the Russian invasion of Ukraine. The investment volume in real estate assets in Romania reached €1,278 million, a historical level, corresponding to a 40% y-o-y increase. The most active segment was the Office one (62% market share out of the total volume transacted), followed by the Retail (25%), Industrial (5%) and Hospitality (4%). Moreover, the Romanian investors were very active, having a 48% market share in the total volume, while also being involved in the largest transaction of the year, which implied acquiring a major office portfolio for almost €400 million.
The market liquidity remains relatively strong and 2023 may also record a series of landmark transactions, as the pressure on financing costs should lessen in H2 when the interest rates and inflation are expected to be on a downward trend. Although Romania remains a smaller market than Poland, it has significantly shortened the gap between total investment volumes when compared with the Czech Republic in 2022, while also overtaking Hungary for the first time.
Located in the heart of the city center, the Cushman & Wakefield Echinox office in Bucharest helps our clients to respond to the ever-increasing opportunities offered by the local real estate market – both within the city and throughout the CEE and SEE regions.
WHY ROMANIA?
Economic growth
- Romania recorded a 4.7% GDP growth in 2022, one of the highest in the EU (Eurostat);
- Robust growth forecasts for 2023 (2.8%) and 2024 (4.8%), respectively (National Commission of Prognosis);
- Industrial, retail and the IT&C sectors were the main drivers of the GDP growth contributing to more than 50% of the total growth (National Institute of Statistics);
- Bucharest was responsible for 25% of the total Romanian GDP in 2022, having a nominal GDP per capita of €38,400, a value 2.5 times higher than the national average (National Commission of Prognosis);
- In terms of purchasing power parity, Romania’s GDP per capita represented 77% of the EU average in 2022 (the same level with Hungary and Portugal), a significant increase from a corresponding value of 39% in 2006, the year before the country’s joined the EU (Eurostat).
Employment
- Romania had an unemployment rate of 5.4% in March 2023, a level that has remained quite stable during the past 3 years, with no major surge of unemployment being recorded in that period;
- 5.1 million people were employed in Romania at the end of February 2023, an increase by more than 900,000 compared with the 2009 – 2010 crisis (National Institute of Statistics);
- The industrial sector employs around 25% of that total, Romania having one of the highest % of the workforce involved in the industrial output in the EU (Eurostat);
- The IT&C sector has more than doubled in terms of employees since 2010 (National Institute of Statistics);
- 554,000 students enrolled in Romanian universities in 2021 (National Institute of Statistics);
- Foreign language proficiency: 97% of Romanian high school students study 2 or more foreign languages; 90% of the university students are proficient in English (ABSL, Eurostat).
IT specialists
- 143,000 IT specialists (excluding the Communication sector) in February 2023 (National Institute of Statistics);
- Average net salary ~€2,100, the highest figure for any sector, more than 2 times higher than the national average, benefitting from an income tax exemption (National Institute of Statistics);
- Romanian software companies such as UiPath (the first Romanian unicorn) or Bitdefender (an internationally recognized antivirus provider) have made significant breakthroughs on the global level in terms of reputation and efficiency.
One of the fastest internet speed
- 10th fastest fixed internet broadband speed in the world and the 3rd fastest in the EU (Speedtest Global Index April 2023).
Strategic base for IT companies
- Important IT companies such as Oracle, IBM, Microsoft, HP, Ericsson or Electronic Arts have been present on the local market for more than 10 years and are some of the largest office occupiers in country;
- Oracle has the single largest office presence in Romania and has its second largest office in Europe, while Electronic Arts has its largest office in Europe in Bucharest;
- Newcomers such as Amazon, DB Technology, Deloitte Technology or the service center of the London Stock Exchange Group further illustrate the importance and the overall potential of the Bucharest office market, a market which is expected to further expand by the end of the present decade.
What we offer
Cushman & Wakefield Echinox is a top real estate consulting company on the local market and the exclusive affiliate of Cushman & Wakefield in Romania, owned and operated independently.
With over 30 years of real estate market experience, the team of over 80 professionals and collaborators provides expertise across all aspects of the market and strategic advice to help investors, developers, property owners and occupiers respond to the region’s opportunities.
Working with both public and private sector clients across Romania and the SEE and CEE regions, we help unlock the benefits of selling, leasing or buying premium residential properties, offices, industrial and logistic units, retail and leisure assets and land plots, based on specialised valuation or research reports and supported by strong property management through Asset Services and project management through Project Development Services teams. We also facilitate access to investment and capital markets that can drive projects forward, helping transform our towns and cities into great places.
Our specialist teams offer particular areas of expertise in the following sectors:
- Commercial real estate (offices and retail)
- Food & Beverage
- Banking/ Financial Services
- Premium Residential (agency, valuation)
- Technology, IT & Communication
- Automotive
- Industrial & Logistics
- Land
- Hospitality
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