JLL: real estate investments in Romania to hit new record, yields still above region's average

After transactions summing up to EUR 656 mln in January-September, Romania's real estate investment market may reach EUR 1.2 bln in full-year - a new record after 2008, according to real estate consultancy firm JLL Romania.

While the trend is in line with the active developments in the region, the yields tend to remain constant in Romania - as opposed to a broad upward pattern seen abroad. This may be because of the already superior yields on the Romanian market: 6.75% for the office sector, 7.25% for retail, and 7.50% for the industrial segment.

In Poland - the largest market in Central and Eastern Europe - one can see a significant increase in yields over the course of this year: 100bp for the industrial sector and 50bp for the office sector, which reflects a price adjustment of 22% for industrial and 11% for office, partially offset by rising rents.

"The trend can be explained both by the increase in risk aversion and the increase in financing costs. The main reasons why Romania did not follow the same trajectory are the significantly higher levels of returns offered by the local market as well as the type and source of capital of investors," explained Andrei Văcaru, Head of Capital Markets JLL Romania, quoted by Wall-street.ro.

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