Deliveries of modern retail projects in Romania expected to reach highest level since 2008
Four modern retail projects with a total leasable area of 30,000 sqm were delivered in Romania in the first half of the year and the deliveries expected in the second half are estimated at 260,000 sqm.
As a result, 2023 is primed to set a record level of retail deliveries in Romania since 2008, as the total stock will surpass the 4.5 million sqm threshold by the end of this year, according to an analysis by real estate consultancy firm Cushman & Wakefield Echinox.
Giurgiu, Călărași, Dej, and Vaslui are the cities that benefited from the new investments inaugurated in the first half. The four projects were Funshop Park Vaslui (10,000 sqm) developed by Scallier, Retail Park Dej (7,000 sqm) owned by the Cometex group (a subsidiary of the Altex electro-IT retailer), Shopping Park Giurgiu (7,000 sqm) completed by Square 7 Properties & Mitiska REIM and Irimia Shopping Center (6,000 sqm), an investment finalized by a local businessman.
With a modern retail stock of 4.23 million sqm, Romania is the third-largest market in Central and Eastern Europe, after Poland (with an inventory of 16 million sqm) and the Czech Republic (with 4.5 million sqm).
Ten projects with a total area of close to 260,000 sqm are expected to be completed in the second half of 2023, four having more than 25,000 sqm GLA. These include Promenada Craiova (78,500 sqm - a shopping center, a retail park, and a Dedeman store) developed by NEPI Rockcastle, Prima Shopping Center (70,000 sqm) developed by Oasis Consulting in Sibiu, Alba Iulia Mall (29,000 sqm), a Prime Kapital - MAS REI investment, and AFI Park Arad (29,400 sqm) owned by AFI Europe. Promenada Craiova and Alba Iulia Mall will be the largest retail schemes developed in the two respective locations.
Some 60% of the retail spaces due to be delivered in H2 are in retail parks, with the rest in shopping centers.
“After a period of two and a half years during which developers had mainly delivered retail projects with areas up to 10,000 sqm GLA in smaller destinations in terms of population, starting from the second half of this year we will see a new supply also consisting of schemes of over 20,000 sqm, in larger cities such as Craiova, Sibiu, Iași, Pitești, Arad, Alba Iulia, or Brașov. There are currently more than ten retail projects exceeding 20,000 sqm that have been announced, some being already under construction or in advanced stages of permitting, a fact which once again illustrates the retail developers' long-term commitment to Romania, despite the inflationary pressures and the retail sales expected compressions,” said Dana Radoveneanu, Head of Retail Agency Cushman & Wakefield Echinox.
The prime shopping center rents remained flat in Q2 2023, with the headline rent achieved for 100 - 150 sqm units in dominant shopping centers in Bucharest being around EUR75-80/sqm/month. The corresponding figures in secondary cities, such as Cluj-Napoca, Timișoara, Iași and Constanța, ranged between EUR50-65/sqm/month, while the level recorded in tertiary locations was EUR30-35/sqm/month.
(Photo source: Cushman & Wakefield Echinox)