Asking rents in retail down to half in two years, further decrease expected, More Real Estate

Asking rents for retail spaces in Bucharest went down in the last two years by as much as 50 percent and even more in some area of the capital city, according to a recent report issued by More Real Estate Services. The occupancy rate reached a lower level in 2010 compared to 2008, according to the company. From a 5 percent availability rate in 2008, the segment evolved to a 15 to 20 percent availability rate, according to Ilias Papageorgiadis, CEO of More Real Estate Services. The biggest drop in asking rents was registered in the luxury central area, where rents were 'unjustifiably high in 2008', according Papageorgiadis. The old part of the town – the Lipscani area – saw the smallest decrease rate. In some cases, asking prices are even higher than in 2008, due to the revamping of the area. Tenants have renegotiated rents for retail spaces and More Real Estate Services expects another round of renegotiations in 2011. So far, tenants have managed to obtain rent reductions of up to 44 percent. One of the tenants represented by More Real Estate Properties has asked for a renegotiation of a contract signed at EUR 95/sqm/month, the landlord offered EUR 70 and the contract was finally signed at EUR 53/sqm/month. The difference between the asking price and the price at which the contracts are signed can vary between 10 and 15 percent, according to More Real Estate Services, but this depends on the features of the retail space. Rental price evolutions on Bucharest areas

Calea Victoriei- EUR 130 in 2008 – EUR 55 in 2010 Calea Dorobantilor – EUR 100 in 2008 - EUR 55 in 2010 Dorobanti Square/Radu Beller St. - EUR 120 in 2008 – EUR 70 in 2010 Unirii Square – EUR 90 in 2008 – EUR 40 in 2010 Lipscani area – EUR 55 in 2008 – EUR 35 in 2010 Universitate Square – EUR 70 in 2008 – EUR 35 in 2010 Romana Square (Amzei Square) – EUR 100 in 2008 – EUR 40 in 2010 Victoriei Square – EUR 75 in 2008 – EUR 50 in 2010

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