The yields generated by Romanian properties are still high as they have decreased by only 75 basis points over the past four years to some 7% and Romania is the only country in the region where the yields are not yet where they were 12 years ago, CBRE head of investment properties Gijs Klomp said, quoted by Profit.ro.
However, there are not enough projects on the market therefore this is the best time for forward-purchase contracts, meaning contracts signed now for projects to be delivered in the future. Forward-purchase contracts help buyer capture favorable prices on the market and the seller diminish risk and finance the project cheaper, Klomp explained.
Among the investors in the local market, Skanska, Forte partners and One United are inclined to rely on such contracts. The main attraction of the Romanian market is the ratio between risk and price, the most attractive in Central and Eastern Europe, the CBRE official believes, but he warns that this is expected to change as new investors are coming in.
"New names entering the Romanian market in the first nine months, such as White Star, Indotek and Morgan Stanley, sent a very positive message to investors interested in Romania. We expect that in 2020 we will see other companies that will take the first step in Romania and we are pleased to already have discussions in this regard,” added Gijs Klomp.
There are only two transactions worth over EUR 100 mln in the pipeline as of now: the four office buildings worth EUR 309 mln that NEPI Rockcastle is in talks to sell to AFI Europe and the Hermes Business Campus, developed by Atenor, and valued at around EUR 150 mln.