Romania’s construction output posts 8.2% y/y growth in Q1

The output reported by Romanian construction companies increased by 8.2% y/y in the first quarter of the year (Q1), setting grounds for a strong advance driven by the absorption of Resilience Facility and SAFE funds for various civil engineering and nonresidential building projects.

Last year, Romania’s construction output increased by 8.0% y/y, driven by residential and non-residential segments, after a moderate correction (-5.9% y/y) in 2024, followed by robust growth of an average 14% per year over the previous five years – which was roughly equal among all three segments of the market.

In Q1 this year, the residential segment has been in recovery mode with a robust 16.1% y/y advance along an upward trend over the past six quarters. However, in absolute terms, the activity in this segment lags behind the record levels seen in 2021-2022 and will probably continue at slightly moderate rates given the higher-than-expected inflation and the households’ smaller budgets.

The civil engineering segment, already at a record level following 8.5% y/y advance in Q1, is expected to thrive amid several large-scale projects financed from EU funds that have to be completed by the end of the year.

The non-residential buildings segment (+1.8% y/y in Q1) also faces a robust outlook – but its complex structure and the different dynamics of separate sub-segments (buoyant industrial and logistics in contrast to less expansionary office segment) complicate the forecast.

(Photo source: Cateyeperspective/Dreamstime.com)