27th June
2007
GE Real Estate and Helios Phoenix Create Euro 175M
Development
GE Real Estate Central & Eastern Europe ('GE Real Estate') and Helios Phoenix
have announced the creation of a joint venture to undertake euro 175 million of
distribution warehouse developments throughout Romania. The transaction represents
GE Real Estate's first entry into the Romanian real estate market.
The joint venture will initially develop seven Class A logistics and distribution
warehouses, totalling 315,000 sqm located in the largest cities of Romania, with
close access to highways and major roads, and with some located in the proximity
of airports. The developments are being undertaken in response to the ongoing
demand for high quality industrial warehouse and logistics facilities across Romania
underpinned by its strong GDP growth. The first projects, to be undertaken on
a speculative basis, will be in Bucharest, Timisoara, Constanta, Brasov and Cluj.
Phoenix Real Estate has been active in Romania since 2001. The Company has already
developed over 60,000 sqm of warehouse and logistic facilities in Romania. Helios
Properties, who have been trading for 11 years, are a major UK Industrial warehouse
developer, procuring over 2 million square meters of space. Helios Properties
and Phoenix Real Estate formed a joint venture in 2006 to develop and manage industrial
warehouse and logistic properties in Romania.
Nestor Myrianthous, CEO of Helios Phoenix, commented:
"We, at Helios Phoenix, are delighted to be collaborating with GE Real Estate,
one of the world's leading commercial real estate companies to co-develop the
most significant industrial real estate project in Romania to date."
Karim Habra, Managing Director of GE Real Estate Central and Eastern Europe, commented:
"These developments will be the first bespoke portfolio of logistics warehouses
in Romania, a market which is currently undersupplied. The recent EU accession
is expected to further enhance Romania's GDP growth and consumer and industrial
demand, which in turn will lead to greater demand for warehouse space.
"We look forward to partnering with Helios Phoenix on these developments.
They have a strong reputation of developing high quality warehouse schemes with
six years experience in the local market and we anticipate that we will derive
great benefit from working with them on these exciting projects. Romania represents
our 8th market in the region and as in prior markets we hope to build our presence
in the market through partnerships with local players, such as Helios Phoenix.
"
DTZ Romania assisted GE Real Estate in the transaction. About GE Real Estate
GE Real Estate currently has over euro 1 billion invested in Central and Eastern
Europe. The Company has invested or developed in the retail, office, residential
and logistics sectors in the Czech Republic, Poland, Slovakia, Bulgaria, Hungary
and Romania. The Company made its first investment in Turkey in 2006.
Source: Earthtimes.org
Fierce competition over top managers on real estate market
The current real estate boom has embroiled firms operating on the market into
a competition to recruit individuals for high-level management positions. At least
10 top managers have changed positions in the past six months. According to human
resources specialists, salaries for top management positions are often exceeding
a monthly level of 10,000 euros.
Polimeni, a U.S. company specialising in the development of shopping centres and
housing complexes, which arrived on the domestic market several months ago, recruited
its national manager from the Austrian real estate investment fund Europolis.
The newly appointed manager, Stefan Gheorghiu, says he left Europolis because
he did not want to miss out on the opportunity of heading operations at a major
real estate developer that specialises in shopping centres and residential complexes.
Gheorghiu's situation is not unique, however. Early this year, Raiffeisen Evolution,
the real estate development unit of the Austrian Raiffeisen group, recruited both
Ionel Giuglea, the former general manager with Alpine builder, and Monica Barcutian,
the former chief financial officer with Strabag group's domestic infrastructure
and constructions unit, in order to encourage domestic investments.
Other examples include Andrei Panculescu, who has, since October, held the position
of acquisitions and commercial manager with Westhill Investments, which operates
investments above 100m euros. In February, Ovidiu Marian, a former chairman of
the National Tourism Authority and CEO of the Howard Johnson Hotel Bucharest,
became the CEO of Baneasa, so far the biggest real estate project launched on
the domestic market.
What persuades a top manager to drop his or her current job and move to another
company? George Butunoiu, one of the best-known headhunters working in the business,
says he has recruited 4 general managers in major real estate development, real
estate firms or financial institutions dealing with real estate development, over
the past 6 months.
A headhunter's job is not quite as easy as it seems: "The real estate market
is more dynamic than the other markets for the simple reason that gains are derived
quickly and at a high level; on the spot in many cases," states Butunoiu.
However, he maintains that it is unusual to see major moves at the CEO level,
as most companies are grounded in an entrepreneurial or semi-entrepreneurial business
structure.
At present, the real estate market is booming. The first consequence of this?
The hunt for managers is continuing to gain momentum. Therefore, salaries for
top management positions in real estate are several times higher than the monthly
level of 10,000 euros. There are quite frequent management changes due to the
real estate boom and particularly to the fact that the real estate market has
very few professionals and specialists.
Source: ZF.ro
Agip invests €7 mln in five new filling stations in Romania
Romania, the domestic branch of the Italian petroleum group Eni SpA, will invest
approximately €7 million ($9.4 million) in opening five new filling stations
this year, stated the company's general manager, Nicola Meuli.
The Italians announced their intention to invest €36 million ($48.4 million)
within the next four years, which would boost Agip Romania's market share from
2%, to 4% after the investment program is completed. “In order to have a
comfortable position on the market, we would require a minimum share of 8%,”
added Meuli.
He also added that the big infrastructure projects announced on the market represent
a significant development opportunity for the fuel retail market. Agip Romania
estimates a €90 million ($121 million) turnover, alongside a net profit of
€2 million for this year. (zf.ro)
Source: BBJ.hu
Romanian entrepreneurs poised for regional expansion
It is worth taking steps to expand Romanian business into regional states and
even into Europe, if the risks involved are carefully considered. This was the
conclusion of the seminar -"Economy's biggest players. What chance does Romanian
capital stand in the EU?"- organised by Ziarul Financiar in partnership with
Banca Comerciala Romana, Petrom and Nestor Nestor Diculescu Kingston Petersen
(NNDKP) law firm. The seminar brought together Romanian market leaders, according
to data available in Romania's Business Yearbook, published by ZF.
"Many Romanian businesses have reached a certain level of sophistication,
which now allows them to enter the European Union market. Romanian capital has
the opportunity to hatch.
The challenge, however, will be the extraordinary levels of competition in the
EU," says Manuela Nestor, managing partner of NNDKP, the leader of the business
law market.
She believes there are many opportunities for Romanian-held companies in neighbouring
regional countries, as a first step towards European expansion. "Serbia,
Macedonia, Albania and the former Yugoslavian states are now providing all the
opportunities that existed in Romania in '93-'96. These countries are only beginning
to privatise, almost their entire industry is up for sale," Manuela Nestor
explained.
Beyond the trend of expansion into neighbouring countries, Romanian companies
are also facing increasingly fiercer competition from foreign rivals on the domestic
market. "The Romanian market remains an extremely attractive environment
for foreign investments, which will seek to take advantage of the good risk/benefit
ratio," says Nicolae Danila, chief executive of BCR, the largest bank on
the market.
Danila believes that the domestic consumption market has not been sufficiently
penetrated yet and offers a significant growth potential, which could be capitalised
on through European funds and investments, either local or foreign. The average
hourly wage in Romania stands at 2.3 euros, compared with 21.2 euros in EU25 (i.e.
before the enlargement in 2007), Danila added.
Werner Schinhan, deputy chief executive of Petrom says, "there are still
many businesses to sell and develop in Romania. In Austria, the country of OMV
(Petrom's owner) the stock exchange was both the growth driver for the business
and for the economy, a recipe that could work for Romania, too," he believes.
"Language skills and education are among the strong features in Romanian
businesses," says Schinhan, which could aid Romanian-held companies to expand.
"To succeed in Romania, however, you also need a degree of luck," Petrom's
official specified.
Some of the most successful companies in Romania started out with 200 square metre
stores, often located somewhere outside Bucharest, and are now market leaders
in their respective fields.
"In 1993 I started with a single 200 square metre shop in Piatra Neamt. Now
Altex has 120 stores covering a total of over 80,000 square metres," says
Dan Ostahie, general manager of Altex, the leading domestic electronics and home
appliances retailer.
Another company that started its business life in a similar fashion was Arabesque,
the leading distributor of construction materials and similar products on the
domestic market. Launched in 1994, Arabesque posted 144,000-euro turnover in its
first year and last year reported a turnover of 288 million euros, according to
general manager Virgil Cezar Rapotan. He believes, in the case of Arabesque, expansion
"came naturally" and Romanian companies, which carefully analyse the
risk of foreign expansion, have every reason to ultimately take the step of expanding
abroad.
Source: ZF.ro
Spanish Detea and Lar: 1bn euros in real estate
and energy
Spanish groups Detea and Lar intend to invest 910 million euros within the next
two years in developing real estate projects, as well as projects in energy and
agriculture. The wave of investments began last year, when several Spanish developers
announced their intention to invest hundreds of millions of euros in real estate
projects on the domestic market.
In Romania, there are currently 876 companies operating with Spanish capital,
involved mostly in the real estate and the constructions sector. "Lately,
Spanish companies have increased their presence on the domestic market, investing
mainly in the constructions sector and in real estate projects, as well as in
the automotive industry and wood processing.
In 2006, Spanish investments in Romania reached 309 million euros, 45% of which
were in real estate," stated Rosa Maria Sanchez-Yebra, advisor with the Spanish
Commercial Office of the Spanish Embassy, at a seminar on real estate. The Detea
group, which owns assets worth over 1.1 billion euros, will invest around 800
million euros in developing real estate projects, in building wind power plants
and in agriculture.
Another Spanish developer, which has already entered the market, Grupo Lar, has
plans to build three residential complexes in Bucharest, with a total of 645 homes,
having a cumulated sales value estimated at around 110 million euros.
Source: ZF.ro
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