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The strong competition between Bucharest's commercial centers is a driver for retail space developers to start projects in the country's big and medium-sized cities or to expand their presence in those locations, although there is still room for new commercial projects in the capital city too, shows real estate service provider CBRE.
Romania's modern retail stock reached approximately 3.7 million sqm in H1 2019, including both retail parks and shopping centers, and another roughly 130,600 sqm of such facilities are due for delivery by the end of the year, shows the "Romania MarketView H1" research report by CBRE.
Bucharest accounts for 31 percent of the total retail stock; shopping centers, the most common retail format in Romania, account for 61 percent of the total area.
About 67,000 sqm of retail space have been added to the total commercial stock in H1 2019 thanks to the most ambitious project delivered in Q2, specifically the expansion of Timisoara's mixed-use facility Iulius Town, shows the report. Other extensions of high-performing shopping centers as well as a new small retail park, delivered in Drobeta Turnu Severin, are among the top new deliveries on the market, CBRE said.
"The strong competition between Bucharest's existing shopping centers encourages retail developers to expand their investments in regional cities, by developing small projects, but with expansion potential," said Carmen Ravon, head of CBRE Romania's A & T Services.
Modern retail space deliveries are expected to double in value in H2 compared to the first half of the year, as approximately 130,600 sqm are expected on the market. The bulk of these spaces (97 percent) will be located outside Bucharest, following the investors' tendency to focus on regional cities, CBRE notes. In addition, shopping centers represent 37 percent of the planned projects, while the rest are retail parks, both small and large.
The international developers NEPI and Prime Kapital/MAS Real Estate, focused on the retail segment, dominate the market of large investments with 73 percent of the total area planned for 2019. The Sibiu-based 42,200 sqm project Festival Centrum developed by NEPI is scheduled for delivery in Q4 2019, while Prime Kapital/MAS Real Estate is also preparing the opening of two retail parks, one in Balotesti, the other in Zalau. The expansion of Craiova's Electroputere Park is also expected to open its gates for the customers in the south of the country by the end of the year.
