Bucharest City Report Q4 2014

Bucharest City Report

Raportul BucuretiQ4 2014 / T4 2014

RO Q4

Bucharest City Report Q4 2014

COPYRIGHT JONES LANG LASALLE IP, INC. 2015. All Rights Reserved 2

Economy/Investment

Economic Climate

The Romanian economy continued its positive trend in Q3

2014, registering a GDP growth of 3.3% when compared to the

same period in 2013. Romanias GDP growth for the entire

2014 was forecasted at 3.0% by Oxford Economics in

December. In the first 11 months of the year, growth was

driven mainly by retail sales that increased by 7.4% y-o-y

(11.2% in the non-food category) and by the industrial sector.

Consequently, in the same period, exports and imports both

grew by 6.5% and 6.0% respectively. The IT&C sector is

gaining momentum, registering a growth of 15% y-o-y in the

first 9 months of 2014 and reaching a share of approximately

5% of GDP. The construction sector continued to struggle (-

9.9% y-o-y in the first 11 months) mainly because of the sharp

decrease in infrastructure works (-25.4% in the same 11

months). However, the volume of residential construction

registered a strong growth rate of +36.4%.

According to Oxford Economics reports, GDP growth is

expected to accelerate in 2015 to 3.3%, with all sectors of the

economy having a positive contribution.

GDP Growth (%) / Cretere PIB (%)

Source/Surs: INS & Oxford Economics, December 2014

The annual average inflation rate (December 2013

December 2014) was at a record low of 0.83%. The National

Bank of Romania decreased the monetary policy rate five times

in 2014 from 4.0% to 2.75%, aiming to encourage the credit

market and support economic growth. The trend is expected to

continue in 2015. The exchange rate remained very stable over

the year, oscillating between 4.38 and 4.54 RON for 1.

Government debt decreased below 38.5% of GDP, the third

lowest in the EU after Estonia and Luxemburg, while the

estimated government deficit for 2014 is below 2.0% of GDP.

CDS levels for Romania are below 150 bps, the lowest in the

last 6 years.

Investment Climate

The property investment volume recorded in Q4 2014 is

estimated at approximately 514 million, while the total annual

volume was close to 1.3 billion, the second highest ever

registered in Romania. 2015 also looks promising, as several

key deals are currently under offer, in all market sectors. The

largest transactions in Q4 were the purchase of Promenada

Mall for around 148 million by NEPI and the acquisition of

Europolis Park by P3 for well over 100 million. Globalworth,

the most active buyer in 2014, secured 3 office buildings in the

last quarter: Nusco Tower, Green Court A and Unicredit HQ for

a combined value of approximately 133 million.

In 2014, transactional activity was mainly focused on the retail

sector (over 40% of the total volume), followed by office (35%).

The industrial market came back in to the spotlight in 2014 with

several transactions and has strong fundamentals to positively

surprise in 2015.

Source/Surs: JLL

An important new trend has been the sale of large portfolios of

NPLs by banks active in Romania. In total, almost 2 billion of

gross book value in loans, partially collateralized by property,

was transacted and further transactions are expected in 2015.

It is likely that many of the underlying assets will be offered for

sale in the near future, increasing the supply of secondary

product. Yields have compressed slightly during the year.

Further compression is dependent on bank margins dropping

as the spread in yields between Romania and more core CEE

markets is currently partially offset by the spread in bank

margins, which is especially affecting leveraged buyers. The

growing interest of both existing investors and new ones

actively assessing the market, is expected to animate the

transactional environment as well as to catalyze the start of a

new development cycle.

-2

-1

0

1

2

3

4

2010 2011 2012 2013 2014F 2015F

Yields /

Randamente

Office /

Birouri

Shopping

Centers / Centre

Comerciale

Industrial

/

Industrial

Q4/T4 2014 8.00% 7.75% 9.75%



Economie / Investiii

Mediul economic

Economia Romniei i-a continuat trendul pozitiv i n T3 2014

nregistrnd o cretere a PIB de 3,3% n comparaie cu aceeai

perioada din 2013. PIB-ul Romniei este estimat s creasc cu

3,0% in 2014, conform unei prognoze Oxford Economics din

decembrie 2014. n primele 11 luni ale anului, creterea s-a

datorat n principal comerului cu amnuntul, a crui cifra de

afaceri a crescut cu 7,4% (11,3% la vnzrile de produse

nealimentare), dar i produciei industriale. n consecin, n

primele 11 luni din 2014 att exporturile ct i importurile au

crescut cu 6,5%, respectiv 6,0%. Sectorul IT&C a luat avnt,

nregistrnd o cretere de 15% n primele 9 luni ale anului, i

ajungnd la o cot de aproximativ 5% din PIB. Sectorul

construciilor a continuat s scad (-9,9%), n principal datorit

reducerii puternice a volumului de lucrri de infrastructur (-

25,4%). Totui, construciile rezideniale au crescut cu 36,4%.

Conform ultimelor rapoarte ale Oxford Economics, se

preconizeaz ca PIB-ul Romniei s accelereze la 3,5% n

2015, susinut de toate sectoarele economiei.

Rata anual a inflaiei a atins n perioada Decembrie 2013

Decembrie 2014 un nivel sczut record de 0,83%. Banca

Naional a Romniei (BNR) a sczut rata dobnzii de politic

monetar de cinci ori pe parcursul anului de la 4,0% la 2,75%,

o micare ce are ca scop ncurajarea creditrii i stimularea

creterii economice. Trendul descendent va continua cel mai

probabil i n 2015. Rata de schimb valutar a fost relativ stabil

n 2014, cursul oscilnd ntre 4,38 i 4,54 Ron pentru un Euro.

Monetary Policy Rate of NBR / Rata dobnzii de politic monetar a

BNR

Source/Surs: BNR

Datoria guvernamental a sczut la sub 38,5% din PIB i este

a treia cea mai redus la nivelul Uniunii Europene dup

Estonia i Luxemburg, iar estimarea de deficit bugetar pentru

2014 este de sub 2,0% din PIB. Nivelul CDS-urilor pentru

Romania este sub 150 puncte procentuale, cea mai sczut

valoare din ultimii 6 ani.

Mediul de investiii

Volumul tranzaciilor imobiliare nregistrat n ultimul trimestru al

anului este estimat la 514 milioane de Euro,n timp ce volumul

total al investiiilor nregistrat n 2014 a ajuns la aproape 1,3

miliarde de Euro, a doua cea mai ridicat valoare din istorie.

2015 arat promitor, avnd n vedere ca un numr ridicat de

proprieti din toate segmentele pieei se afl n faze avansate

de negociere. Cele mai mari tranzacii au fost achiziia de ctre

NEPI a Promenada Mall pentru aproximativ 148 de milioane de

Euro i achiziia de ctre P3 a Europolis Park pentru mai mult

de 100 de milioane de Euro. Globalworth, cel mai activ

cumprtor din 2014, a reuit s securizeze in T4 3 cldiri de

birouri: Nusco Tower, Green Court A i Unicredit HQ pentru o

valoare combinat de aproximativ 133 milioane de Euro. n

2014 activitatea tranzacional a fost axat pe proprieti de

retail (peste 40% din total) urmate de birouri (35%). Piaa

proprietilor industriale a revenit n lumina reflectoarelor n

2014, cu un numr important de tranzacii, i ar putea

surprinde pozitiv in 2015.

Un nou trend aprut n pia a fost vnzarea unor portofolii de

credite neperformante ale bncilor active din Romnia. n total,

mprumuturi cu o valoare nominal de aproape 2 miliarde de

Euro, din care o parte garantate cu proprieti imobiliare, au

fost tranzacionate, iar valoarea acestui tip de tranzacii ar

putea crete n 2015. Este probabil ca multe din aceste

proprieti s fie puse ctre vnzare n viitorul apropiat,

crescnd astfel oferta de produse secundare. Randamentele

investitionale au cobort uor n 2014. Continuarea acestui

trend depinde de scderea dobnzilor bancare deoarece

diferena dintre randamentele din Romnia i cele din restul

rilor din CEE este n acest moment anulat de diferena

dintre dobnzile bancare, ceea ce afecteaz n mod deosebit

cumprtorii care apeleaz la mprumuturi. Interesul din ce n

ce mai crescut al investitorilor noi sau deja existeni care

monitorizeaz activ piaa va anima cel mai probabil activitatea

tranzacional i va cataliza startul uni nou ciclu de dezvoltare.

Annual Inflation Rate / Rata anual a inflaiei

Source/Surs: Eurostat, BNR

0%

2%

4%

6%

8%

10%

12%

2008 2009 2010 2011 2012 2013 2014

2%

4%

6%

8%

10%

2008 2009 2010 2011 2012 2013 2014F



Office Market

Supply

In Q4 2014, four projects were completed: Green Court

Building A, AFI Park 3, Ethos House and Bratianu Business

Center, which together added slightly over 41,000 m of office

space to the market. The total of office supply delivered in 2014

reached approximately 121,000 m. It is interesting to note that

this value is close to the one registered in 2013 and to what we

estimate will be delivered in in 2015, when several large

projects currently under construction should be finalized: Green

Court Building B, AFI Park 4 & 5, City Offices and Sema Park

Phase 3. The modern office stock in Bucharest is currently

around 2.2 million m2.

Considering that the market is bottoming out, developers

announced a large number of projects in 2014, with the vast

majority being located in the two main sub-markets in the north

of the capital city (FloreascaBarbu Vacarescu and Dimitrie

Pompeiu) and in the rising central western part (CenterWest).

These areas primarily attract the dynamic and rapidly

expanding companies from the IT industry. Therefore,

deliveries are expected to surge in 2016, when around 240,000

m will most likely be completed, out of which, more than 30%

are already pre-let. However, considering the low level of new

deliveries in these sub-markets in 2015, we do not expect any

significant change in rental levels over the coming 12 months.

Office Stock in Bucharest (Class A&B) and Vacancy Rate / Stoc spaii

birouri n Bucureti (clase A&B) i rata de neocupare

Source/Surs: JLL

The overall vacancy rate in Bucharest decreased over the

quarter by 100 bps to 13.3%, the lowest level in the last 6

years. This was mainly due to the new supply being largely

pre-let and strong new demand. It is expected that the vacancy

rate will continue to decrease in 2015, as the space delivered

will most likely be surpassed by the new demand. Vacancy

rates continue to be uneven between the sub-markets, which is

reflected in the evolution of the rental levels. While in Baneasa

and Pipera North vacancy is around 35%, vacancy in the CBD,

North, West and Dimitrie Pompeiu is below 10%.

Demand

In Q4 2014, the registered gross take-up was 102,400 m2. New

demand (including new leases, expansions and pre-leases)

accounted for approximately 67,800 m2 of the quarterly leasing

activity, while 34,600 m2 were renegotiations and renewals. In

2014, total take-up registered a record level of approximately

295,000 m, slightly over the one registered in 2013. The

largest transactions in Q4 were the pre-lease of Telekom in

Globalworth Campus (25,000 m2) and the renewal of Renault

in North Gate (20,000 m). By geography, Dimitrie Pompeiu

was the most active sub-market with over 48% of the quarterly

take-up, followed by the CBD and Floreasca Barbu

Vacarescu. By industry, IT&C and Telecom companies were

once again the most active, generating more than 40% of the

quarterly leasing activity, with professional services companies

as runners-up.

Rents

Prime headline rents remained unchanged at 18.5 m2/month

during Q4 2014. Over the last quarter, incentive packages

remained consistent, with landlords usually offering both rent

free periods and fit-out contributions. Incentive packages vary

in value according to the terms of the requirements and

become especially attractive for deals larger than 2-3,000 m2.

Forecast

The supply pipeline for 2015 is expected to be around 120,000

m2. Take-up is forecasted to remain approximately the same as

in 2014, but a significant number of transactions will be pre-

leases. The overall vacancy rate should marginally decrease

by the end of the year. We are of the opinion that prime rental

levels will remain unchanged in 2015.

Prime Office Headline Rent Evolution / Evoluia chiriei contractuale

prime pentru spaii de birouri

Source/ Surs : JLL

10%

12%

14%

16%

18%

0

1,000

2,000

2009 2010 2011 2012 2013 2014 2015F

Tho

usan

ds m

Total Stock (left) Vacancy Rate (right)

15

16

17

18

19

20

21

2009 2010 2011 2012 2013 2014 2015F

/m

/m

onth



Piaa spaiilor de birouri

Oferta & rata de neocupare

n T4 2014, au fost livrate 4 cldiri de birouri: Green Court

Building A, AFI Park 3, Ethos House i Brtianu Business

Center, care mpreun au adugat o suprafa cu puin peste

41,000 m de spaiu clas A i B la oferta total iniial.

ntreaga suprafa livrat n 2014 a fost de aproximativ

121,000 m. Este de remarcat faptul c aceast valoare este

apropiat de cea nregistrat n 2013 i de ceea ce estimm c

va fi livrat n 2015, atunci cnd cteva proiecte mari aflate n

construcie vor fi finalizate: Green Court Building B, AFI Park

4&5, City Offices i Sema Park Faza 3. Stocul modern de spaii

de birouri din Bucureti a ajuns n prezent la 2,16 milioane m.

Annual Office Completions & Pipeline (m2) /

Spaii noi de birouri finalizate anual & proiecte n construcie (m2)

Source/Surs: JLL

Considernd c piaa s-a stabilizat, dezvoltatorii au anunat un

numr mare de proiecte n 2014, majoritatea localizate n cele

2 sub-piee din nordul Bucuretiului (Floreasca-Barbu

Vcrescu i Dimitrie Pompeiu) i n partea de centru-vest,

care atrage n principal companiile dinamice i cu o extindere

rapid din domeniul IT. Prin urmare, oferta de spaii noi va

crete semnificativ n 2016, atunci cnd aproximativ 240,000

m vor fi livrai, din care mai mult de 30% sunt pre-nchiriai.

Totui, innd cont de suprafaa sczut de spaii de birouri ce

va fi inaugurat n 2015 n aceste 3 sub-piee, ne ateptm ca

nivelul chiriilor s rmn neschimbat.

Rata medie de neocupare a sczut n T4 2014 cu peste 100

puncte procentuale la 13,3%, cel mai sczut nivel din ultimii 6

ani, datorit faptului ca proiectele nou livrate au fost n mare

msur pre-nchiriate i cererii puternice. Previzionm c rata

medie de neocupare va continua s scad n 2015, deoarece

suprafaa livrat va fi cel mai probabil depit de cererea

nou. Rata de neocupare este foarte diferit ntre sub-piee,

pornind de la sub 10% n CBD, Nord, Vest i Dimitrie Pompeiu

i ajungnd la 35% n Bneasa i Pipera Nord, lucru ce se

reflect i n evoluia chiriilor.

Cererea

n trimestrul 4 din 2014, preluarea total de spaii de birouri a

fost de 102.400 m2. Cererea nou de spaii (incluznd

contractele noi, extinderile i pre-nchirierile) a fost de

aproximativ 67.800 m2, n timp ce 34.600 m2 au fost

renegocieri. Cerea total n 2014 a atins un nivel record de

295,000 m, cu puin peste valoarea nregistrat n 2013. Cele

mai mari tranzacii din T4 au fost pre-nchirierea Telekom n

Globalworth Campus (25.000 m2) i renegocierea Renault n

North Gate (20,000 m). n funcie de zona geografic, Dimitrie

Pompeiu a fost cea mai dinamic sub-pia cu peste 48% din

totalul nchirierilor, urmat de CBD i Floreasca-Barbu

Vcrescu. n funcie de domeniul de activitate, companiile din

sectorul IT&C i Telecom au fost cele mai active, fiind implicate

n mai mult de 40% din volumul tranzaciilor, urmate de cele din

servicii.

Chirii

Chiriile contractuale prime pentru spaii de birouri au rmas

neschimbate n trimestrul 4 din 2014, fiind cotate la 18,5

Euro/m2/lun. Stimulentele financiare au continuat s fie

consistente, proprietarii oferind att luni libere de plat a chiriei,

ct i contribuii pentru amenajarea spaiilor. Pachetele de

stimulente financiare variaz n funcie de tipul de cerere i

devin importante n special pentru suprafee mai mari de 2.000

3.000 m2.

Previziuni

n 2015 estimm c vor fi livrai aproximativ 120,000 m de noi

spaii de birouri. Ne ateptm ca preluarea total de spaii s

fie asemntoare cu cea din 2014, ns cu numr mai mare de

pre-nchirieri. Rata medie de neocupare va scdea uor n

2015. Chiriile contractuale prime vor rmne cel mai probabil

neschimbate n 2015.

0

100,000

200,000

300,000

400,000

2009 2010 2011 2012 2013 2014 2015F

m



Retail Market

Supply

Two retail projects were delivered in Romania in Q4 2014.

Shopping City Targu Jiu (27,000 m2) is the first modern retail

scheme in Targu Jiu, a city with 82,500 inhabitants, developed

by the South-African investment fund, NEPI. The second was

Auchan Drumul Taberei, a 20,000 m project, developed by

Immochan in the west of Bucharest. With a total supply of

approximately 70,000 m, 2014 was the scarcest year in terms

of new deliveries since 2006. However, encouraged by the

surge in retail sales in 2014, the confidence of developers is

starting to return and new projects are being planned or, are in

advanced stages of construction.

The modern retail stock in Romania is currently estimated at

approximately 2.62 million m. The stock in Bucharest accounts

for more than 35% of the total, meaning approximately 938,000

m, with the remaining 1.68 million m being spread across the

larger cities in the country.

Modern Retail Stock in Bucharest & Pipeline (m2) /

Stocul de spaii comerciale moderne n Bucureti & proiecte (m2)

Source/Surs: JLL

Demand

According to the National Institute of Statistics, after a weak

performance in 2013 (+0.4%), retail sales registered a healthy

7.4% y-o-y growth in the first 11 months of 2014, mainly due to

the surge in non-food sales (+11.2%). The sustained economic

growth, the strong increase in consumption and consumer

confidence, which is at the highest level since 2008 (according

to Nielsen most recent reports), are likely to push retailers to

reconsider their cautious expansion plans in Romania. Existing

shopping centres with proven good performance are still the

main destination of new entrants, due to the limited options in

terms of new supply. The gap between demand for prime and

secondary stock continues to be significant.

In 2014, the most active major fashion retailer was H&M, which

extended its network of stores by 8 new units to a total of 38

across Romania (the best market in CEE for the brand in terms

of revenue). The Swedish group also plans to open its online

shop for the country at the beginning of 2015. Other expanding

brands included CCC Shoes (6 new units), Ecco (5) and Takko

(4). The Inditex Group, the largest fashion retailer in Romania

in terms of turnover, operating approximately 100 shops, did

not open any new stores.

Rents

Prime shopping centre rents remained stable over the quarter

at 60-70 m2/month. The highest rents are achieved in the

most dominant and best performing shopping malls in

Bucharest. Rental levels for prime high street units remained at

55-65 m2/month, but are under pressure given the limited

demand.

Prime Shopping Center Rents in CEE capitals /

Nivelul chiriei prime n centre comerciale n capitalele din CEE

Source/Surs: JLL

Forecast

Approximately 167,000 m are expected to be delivered in 3

large projects in Romania in 2015: Coresi Retail Park (45,000

m), developed by Immochan in Brasov will be inaugurated in

March, Mega Mall (72,000 m), a dominant shopping centre in

the east of Bucharest, developed by NEPI, will open in April

and Timisoara Shopping City (50,000 m) also developed by

NEPI is planned to be delivered close to the end of the year.

0

200

400

600

800

1,000

1,200

2009 2010 2011 2012 2013 2014 2015F

Tho

usan

ds m

0

20

40

60

80

100

120

Budapest Bucharest Prague Warsaw

/m

/m

onth



Piaa spaiilor comerciale

Oferta

Dou proiecte de retail a fost livrate n T4 2014 n Romania,

Shopping City Targu Jiu (27,000 m), dezvoltat de fondul Sud-

african de investiii NEPI, primul centru comercial modern din

Trgu Jiu, un ora de 82,500 de locuitori i Auchan Drumul

Taberei, un proiect de 20,000 m dezvoltat de Immochan n

vestul Bucuretiului.

Cu o suprafa total livrat de aproximativ 70,000 m, 2014

este anul cu cea mai mica ofert de centre comerciale noi din

2006 pn n prezent. Totui, ncurajai de creterea susinut

a vnzrilor, investitorii dau semne c i-au recptat

ncrederea n piaa din Romnia, astfel c proiecte noi au fost

anunate sau deja se afl n stadii de construcie avansate.

Stocul modern de spaii comerciale n Romnia este n prezent

estimat la aproape 2,62 milioane de m2. Bucuretiul, cu mai

mult de 938,000 m, reprezint 35% din ntregul stoc, restul de

1,68 milioane m fiind n oraele mari din ar.

Cererea

Conform Institutului Naional de Statistic, dup ce n 2013 a

nregistrat o cretere modest de doar 0,4%, cifra de afaceri n

comerul cu amnuntul n primele 11 luni din 2014 a crescut

puternic, cu 7,4% n comparaie cu aceeai perioad anul

trecut. Vnzarea produselor non-alimentare a fost ns cea

care a impresionant cu o cretere de 11,2%.

In 2015 este probabil ca retailerii s ii reconsidere planurile

precaute de expansiune, ncurajai de creterea economic

susinut, de creterea puternic a vnzrilor, dar i de

ncrederea cumprtorilor care se afl la cel mai nalt nivel din

2008 (conform celui mai recent raport al Nielsen),

Avnd n vedere numrul redus de proiecte noi, retailerii

interesai s deschid magazine noi analizeaz n special

centrele comerciale performante deja existente. Distana dintre

cererea pentru centrele comerciale prime i cele secundare

continu s fie semnificativ.

n 2014, cel mai activ retailer important de mod a fost H&M,

care a deschis 8 uniti noi n mai multe orae din ar,

ajungnd la un total de 38. Romnia este cea mai bun pia

din Europa Central i de Est pentru grupul suedez n funcie

de cifra de afaceri. Mai mult, retailerul plnuiete s deschid

un magazin on-line n primele luni din 2015 ce va deservi

Romnia. Alte branduri importante active n ultimul an au fost

CCC Shoes (cu 6 noi uniti), Ecco (5) i Takko (4). Grupul

Inditex, cel mai mare retailer de mod din ar n ceea ce

privete cifra de afaceri i care opereaz in aproximativ 100

locaii, nu a deschis nici un magazin nou anul trecut.

Chirii

Nivelul chiriilor prime, a rmas stabil in T4 la 60-70

Euro/m2/lun. Cele mai mari chirii sunt obinute n centrele

comerciale dominante i performante din Bucureti. Nivelul

chiriilor prime pentru unitile stradale a rmas neschimbat la

55-65 Euro/m2/lun, dar sub presiune, innd cont de cererea

limitat.

Previziuni

n 2015 ne ateptm ca n Romnia s se livreze o suprafa

de aproximativ 167,000 m, n 3 proiecte majore: Coresi Retail

Park (cu o suprafa nchiriabil de 45,000 m), dezvoltat de

ctre Immochan n Braov, va fi inaugurat n martie, Mega Mall

(72,000 m), un proiect dominant din estul Bucuretiului,

dezvoltat de NEPI, se va deschide n aprilie iar Timioara

Shopping City (50,000 m) al aceluiai NEPI este plnuit a fi

livrat ctre finalul anului.

Prime Shopping Center Rent Evolution /

Evoluia chiriei prime n centrele comerciale

Source/Surs: JLL

40

50

60

70

80

90

Q4 2009 Q4 2010 Q4 2011 Q4 2012 Q4 2013 Q4 2014 Q42015F

/m

/m

onth

Min Max

80

100

70 65 65

60

90

115

85 80

70 70

0

20

40

60

80

100

120

140

2007/Q4 2008/Q4 2009/Q4 2010/Q4 2011/Q4 2012/Q4

Eu

ro/s

qm

/mo

nth

min max

80

100

70 65 65

60 55 55

90

115

85 80

70 70 65 65

0

20

40

60

80

100

120

140

Eu

ro/s

qm

/mo

nth

min max

80

100

70 65 65

60 55 55

90

115

85 80

70 70 65 65

0

20

40

60

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120

140

Eu

ro/s

qm

/mo

nth

min max

80

100

70 65 65

60 55 55

90

115

85 80

70 70 65 65

0

20

40

60

80

100

120

140

Eu

ro/s

qm

/mo

nth

min max

80

100

70 65 65

60 55 55

90

115

85 80

70 70 65 65

0

20

40

60

80

100

120

140

Eu

ro/s

qm

/mo

nth

min max



Industrial Market

Supply

The industrial stock in Romania is currently estimated at

around 1.9 million m, with approximately 1 million m in the

industrial hubs in and around Bucharest. Q4 2014 saw no new

additions to the market. Some of the completions reported in

2014 include the 3,000 m extension in Otter Logistics Park in

Bucharest, a 12,000 m automotive seating plant (for Lear

Corporation) in Solo Industrial Park Letcani near Iasi, an

extension of 7,500 m in VGP Timisoara, 27,000 m in Ploiesti

West Park and 45,000 m in Timisoara Airport Park. There are

currently no significant speculative developments under

construction in Bucharest. Given the lack of new supply and

the pick-up in demand, the overall vacancy rate in Bucharest

decreased over the quarter to below 10% and to around 12%

across Romania.

Prime Rents for Multi-let / Light Industrial in CEE Capitals/

Nivelul chiriei prime n spaii industriale n capitalele din CEE

Source/Surs: JLL

Demand

In Q4 2014, gross take-up in Romania reached 26,200 m, a

slightly lower level than the one registered in the same period

of 2013. Approximately 33% of the total surface signed is net

take-up, with the rest being relocations, renegotiations and

renewals. The demand increased following the surge in retail

sales and the strong growth of e-commerce during the peak

season Black Friday and winter holidays. For the entire 2014,

total take-up (excluding owner-occupied facilities) in Romania

reached a record level of approximately 313,000 m. Outside

Bucharest, demand is coming mainly from the automotive

industry.

The majority of leasing activity was concentrated in Bucharest,

Arad and Timisoara. In Q4 2014. Bucharests gross take-up is

estimated at approximately 14,700 m, over 56% of the entire

demand, while for the entire year, it represents approximately

40%. The Bucharest West km. 13 and km. 23 sub-markets,

currently comprising 75% of the stock in Bucharest and one of

the lowest vacancy rates in the market, continue to be the most

attractive, due to high quality premises and good infrastructure.

The largest transactions in terms of leases registered this

quarter were the new lease of Elster in Timisoara Airport Park

of 7,000 m and the renewal of Ikea in Bucharest West of 5,000

m. In 2014, the largest deals were the pre-lease of Continental

(45,000 m) in Timisoara Airport Park and the renewal of

Unilever (27,000 m) in Ploiesti West Park.

Rents

Rents for prime distribution facilities are estimated at 3.6 to

4.0 m2/month. Rents for prime light industrial facilities are

quoted between 3.5 and 4.25 m2/month. Larger distribution

units (exceeding 20,000 m2) record rents of about 3 to 3.5

m2/month. However, incentive packages continue to be

significant, especially for larger spaces and longer leases.

Forecast

Demand is expected to continue increasing over the next few

quarters as the economy continues to perform strongly,

pushing vacancy rates down. We may see a slight increase in

demand from e-commerce and logistics companies, but also

relocations. This could trigger the start of new developments

during 2015, especially in Bucharest. Existing developers,

along with new entrants such as P3, will be looking to secure

pre-leases. Production occupiers will continue their high

interest in Romania, so the demand for build to suit facilities will

maintain its trend.

Prime Industrial Rents and Yields /

Chirii spaii industriale i randamente

Source/Surs: JLL

0

10

20

30

40

50

60

70

Bucharest Budapest Warsaw Prague

/m

/ye

ar

8.50%

9.00%

9.50%

10.00%

10.50%

44

46

48

50

52

54

56

Q42009

Q42010

Q42011

Q42012

Q42013

Q42014

Q42015F

Annual rents (left) Yields (rigth)



Piaa spaiilor industriale

Oferta

Stocul de spaii industriale din Romnia este estimat n prezent

la aproximativ 1,9 milioane m cu n jur de 1 milion m n hub-

urile industriale din i de lng Bucureti. n T4 2014, pe piaa

din capital, nu s-au nregistrat livrri noi. Printre spaiile noi

livrate n 2014 se regsesc 3.000 m n Otter Logistics Park din

Bucureti, o fabric de scaune de automobile (Lear

Corporation) de 12.000 m n Solo Indsutrail Park Letcani lng

Iai i extinderile de 7.500 m n VGP Timioara, 27.000 m n

Ploieti West Park i 45.000 m n Timioara Airport Park. Nu

exist n acest moment proiecte majore speculative n

construcie n Bucureti.

Datorit nivelului sczut al ofertei i revigorrii cererii, rata

medie de neocupare a sczut in ultimul trimestru la sub 10% n

Bucureti i 12% n ntreaga ar.

Industrial Take-Up Activity in Romania in Q2 2014 /

Activitatea de nchiriere n Romnia n T2 2014

Source/Surs: JLL

Cererea

n T4 din 2014, estimm c n Romnia s-au nchiriat

aproximativ 26.200 m2 de spaii industriale, o suprafa puin

mai sczut dect cea nregistrat n T4 2013. Aproximativ

33% din totalul nchirierilor a fost reprezentat de cererea nou

de spaii, restul fiind renegocieri i rennoiri. Cererea a crescut

pe fondul creterii puternice a vnzrilor cu amnuntul i a

comerului on-line n perioada de vrf reprezentat de Black

Friday i de srbtorile de iarn. Cererea total nregistrat n

2014 (incluznd doar spaiile nchiriate nu i cele aflate n

proprietatea celor care le ocup) a fost de aproape 313,000 m,

o valoare record. n afara capitalei, cererea este generat n

principal de industria auto.

n trimestrul 4, cererea s-a concretizat n contracte semnate n

Bucureti, Arad i Timioara. n Bucureti, suprafaa total de

spaii industriale nchiriate a fost de aproximativ 14.700 m2,

reprezentnd 56% din ntreaga activitate la nivel de ar. n

2014, capitala a generat aproximativ 40% din volumul de

tranzacii. Sub-pieele Bucureti Vest Km. 13 i Km. 23, ce

cuprind aproximativ 75% din ntregul stoc din Bucureti, au

continuat s fie cele mai atractive, datorit spaiilor de calitate

oferite i infrastructurii bune.

Cele mai mari tranzacii din T4 2014 au fost nchirierea unui

spaiu nou de 7.000 m de ctre Elster n Timioara Airport

Park, dar i rennoirea Ikea de 5.000 m n Bucharest West. n

2014, cele mai mari tranzacii au fost pre-nchirierea Continetal

(40,000 m) n Timioara Airport Park i rennoirea Unilever

(27,000 m) n Ploieti West Park.

Chirii

Chiriile spaiilor de logistic prime sunt cuprinse ntre 3,6-4,0

Euro/m2/lun. Chiriile spaiilor dedicate industriei uoare sunt la

nivelul de 3,5-4,25 Euro/m2/lun. n cazul spaiilor industriale

mari, de peste 20.000 m2, chiriile sunt n jurul a 3,5

Euro/m2/lun. Volumul stimulentelor financiare a continuat s

fie semnificativ, n special pentru suprafee mari i durate lungi.

Previziuni

Ne ateptm ca cererea s creasc n continuare i n

urmtoarele trimestre datorit performanelor bune ale

economiei. Prin urmare, rata de neocupare ar trebui s

coboare. Cererea s-ar putea concretiza prin mai multe

contracte ale companiilor logistice i din comerul on-line. Este

posibil ca 2015 s aduc un val de noi dezvoltri, n special n

Bucureti. Dezvoltatorii deja existeni sau nou intrai (precum

P3) vor urmri s securizeze ct mai multe pre-nchirieri.

Chiriaii industriali vor continua s se dezvolte n Romania, iar

cererea pentru spaii build to suit va continua s fie solid.

Modern Industrial Stock in Bucharest by Location /

Spaii industiale moderne n Bucureti dup locaie

Source/Surs: JLL

Bucharest 53%

Arad 18%

Timisoara 29%

West Bucharest

North Bucharest

North-west Bucharest

South Bucharest

North-east Bucharest

East Bucharest



Market Practice

Office market

Lease length: 3-5 years

Payment terms: Rents denominated in Euro, but paid in Ron

Frequency: Monthly or quarterly in advance

Deposit: 3 months

Indexation: Annually, in general Euro CPI

Rent reviews: Optional, not yet a practice

Agency fees: 15-25% from the yearly rent, excluding any incentives offered by

landlord to tenants

Retail market (shopping centers)

Lease length: 5 years, 10-30 years for the larger anchors

Rent: fixed and/or turnover rent

Payment terms: Rents denominated in Euro but paid in Ron

Frequency: Monthly in advance

Deposit: 3 months


Rent reviews: rare

Landlords fit-out contribution: available only for larger anchor tenants

Agency fees: 12-15% from the yearly rent, excluding any incentives offered by

landlord to tenants

Industrial market

Lease length: 3-5 years for logistics; 5-7 years for production facilities

Rents: industrial area plus additional handling services

Payment terms: Rents denominated in Euro but paid in Ron

Frequency: Monthly in advance

Deposit: 3 months for logistics; 6 months for production facilities


Rent reviews: rare

Fit-out: on tenants cost

Agency fees: 12-20% from the annual rent

Piaa spaiilor de birouri

Perioad de nchiriere: 3-5 ani

Metode de plat: chiriile exprimate n Euro, dar pltite n moneda local, Ron

Frecvena de plat: n avans, lunar sau trimestrial

Garanie: echivalentul a 3 luni de chirie

Indexare: anual, n general cu inflaia din Zona Euro

Renegocierea chiriei: opional, nu este nc o procedur comun

Comisionul de agenie: 15-25% din chiria anual (nu sunt considerate facilitile

financiare, lunile libere de chirie)

Piaa spaiilor comerciale (centre comerciale)

Perioad de nchiriere: 5 ani, 10-30 ani pentru chiriaii tip ancor

Chiria: fix i/sau chirie n funcie de cifra de afaceri

Metode de plat: chiriile exprimate n Euro, dar pltite n moneda local, Ron

Frecvena de plat: n avans, lunar

Garanie: echivalentul a 3 luni de chirie

Indexare: anual, de obicei cu inflaia din Zona Euro

Renegocierea chiriei: rar

Contribuia proprietarului pentru amenajarea spaiului: acordat doar chiriailor

care ocup spaii mari

Comisionul de agenie: 12-15% din chiria anual (nu sunt considerate facilitile

financiare, lunile libere de chirie)

Piaa spaiilor logistice

Perioad de nchiriere: 3-5 ani pentru spaii logistice; 5-7 ani pentru spaii de

producie

Chiria: pentru spaiile industriale plus serviciile de manevr

Metode de plat: chiriile exprimate n Euro dar pltite n moneda local, Ron

Frecvena de plat: n avans, lunar

Garanie: echivalentul a 3 luni de chirie pentru spaii logistice; 6 luni pentru spaii de

producie

Indexare: anual, n general cu inflaia Zonei Euro

Renegocierea chiriei: rar

Contribuii pentru amenajarea spaiului: pe costul chiriailor

Comisionul de agenie: 12-20% din chiria anual



Map: Office Buildings



Map: Retail Developments


www.jll.ro

COPYRIGHT JONES LANG LASALLE IP, INC. 2015. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of Jones Lang LaSalle. It is based on material that we believe to be reliable. Whilst every effort has been made to ensure its accuracy, we cannot offer any warranty that it contains no factual errors. We would like to be told of any such errors in order to correct them.

JLL Office

Victoria Center

145, Calea Victoriei

10th Floor

Bucharest

+40 21 302 3400

+40 21 302 3401

Contacts

Andrei Vacaru

Head of Research & Consultancy

Bucharest

+40 21 302 3400

[email protected]

Andrei Drosu

Junior Consultant, Research & Consultancy

Bucharest

+40 21 302 3400

[email protected]

http://www.jll.rs/

Documents

Bucharest City Report Q4 2014