2020 economic growth is significantly impacted by the global COVID-19 pandemic.
During 2010 – 2019 Romania’s GDP annual growth registered only positive values and at the end of last year estimations were as well for positive growth. The unforeseeable pandemic led to a global economic turmoil ever since the first months of 2020 and changed all forecasts.
Wait and see strategy for the investment market.
Romania’s investment volume at the end of H1 2020 was with 17% higher compared with the same period of 2019, mostly due to the transactions caught by the momentum created in the previous year. Bucharest was the main scene of the transactional activity, while only one transaction was signed in a regional city.
Work from home policy imposed by the mandatory lockdown, slowed companies’ expansion plans.
New supply totaling 104,000 sq m delivered in the first half of the year, increased Bucharest’s modern office stock up to 3.3 mln. sq m. The limited transactional activity was mainly generated by Computers & Hi-Tech and Financial sectors.
Brick & Mortar put on survival mode while online shopping had an uprecedent boost.
Retail was the most impacted by the COVID-19 pandemic as the activity of the shopping centers was drastically reduced for more than three months. With no significant changes in the first six months of the year, Romania’s modern retail stock gathers 3.75 mln. sq m including both shopping centres and retail parks.
Rising star of the real estate market, the industrial sector tripled the TLA in H1 compared with H1 2019.
Romania’s modern industrial stock reached 4.7 mln. sq m and by the end of year is expected to exceed the 5.0 mln. sq m milestone.
Demand was balanced between Bucharest and regional cities and retailers generated 64% of the total leasing activity (TLA).
Residential use tops investors preferences.
As land plots with great development potential are quite scarce throughout the country, they are always under the investor’s radar, no matter the future use. Transactional activity was animated by the residential sector, but retail, industrial and office developers were as well at the negotiation table.