Construction and Real Estate market analysis
2016.01.15.
Made by:
Professional coordination: Made by: Gazdasági Tanácsadó Klub
• Strategic coordination: Kerezsi Miklós Györfy Lehel Rácz Béla Gergely Szász Levente Fugel Edina
• Coordinators: Fekete Réka, Kovács Pusztai Bálint, Szabó Zsolt
• Made by: • Made by: • Made by: Boros Éva Fodor Attila Korcsmáros Boglárka Csibi Beatrix Géger Gyopár Nagy Hunor Györk Csíki Ottó Gergely Andrea Nagy Loránd Deák Levente Gurzó Krisztina Pitó Emőke Deák Péter Katona Edina Szabó László Dibernardo Attila Kerekes Gábor Szabó Norbert Éltes Rita Kiss Norbert Tankó Attila Ursu Laura Agenda
[Global] [Europe] [Romania]
Economical overview
Construction Construction Construction industry industry industry
Real Estate industry Real Estate Real Estate
industry industry
[ Cluj
Real Estate Napoca
industry ] Agenda
[Global] [Europe] [Romania]
Construction
industry
[
Cluj
Napoca ] Construction industry overview- Global (2014) The construction industry‟s total revenue in 2014 was 6.15 trillion EUR, a 3,1% increase compared to 2010.
The top industries by revenue in 2014 Size of construction industry in 2014 (trillion €) (%)
9.73 10.6
Construction industry 9.36 GDP
6.15 89.4 3.5 3.34 1.54 2.14 1.37 Revenue 1.13 The global construction industry increased from 5.58 FMCG Automobile Banking trillion EUR (2010) to €6,15 trillion in 2014, by an Utilities ICT Life Insurance average of 3% yearly. Construction Oil and Gas Real estate
Source: prnewswire.com khl-group.com databank.org swissre.com statista.com Construction industry by revenue (2010-2014) The Global Construction market‟s revenue grew € 640 bill between 2010-2014.
The World Construction Industry‟s revenue (2010-2014, € trill) 6.4
6.2 6.15 6.07 6 5.82 5.8 5.58 5.6 5.45 5.4
5.2
5 2010 2011 2012 2013 2014
We can observe the worldwide continuous growth of the construction market’s size, due to the use of expansive monetary politics, that countries use all over the world. By this stimulating the economy and increasing, among others, the construction market too.
Source: prnewswire.com, marketrepostsstore.com Construction industry by revenue- forecast (2015-2020) The Global Construction market‟s revenue grew and the experts say will rise up to €7,63 trillion in 2020.
The global construction industry‟s revenue forecast (2015-2020, € trill.) 9
8 7.37 7.63 6.83 7.09 7 6.33 6.57 6
5
4
3
2
1
0 2015 2016 2017 2018 2019 2020
The Construction market will produce a 3,8% yearly average growth between 2015 and 2020. This continuous and steady growth signals the industry’s stability and shows its real potencial.
Source: marketrepostsstore.com Construction industry‟s market share- forecast (2018) In 2018 Asia will dominate in the construction industry, with a 39% global share, thanks to of China`s rapid development.
Estimated global shares in 2018 (%) Asia
Japan
24% 39% Eastern Europe 39% 3% MidEast and Africa 24% 5% 8% 17% North America 17% 4%
8% South America 5% 4% 3% Western Europe
Asia probably will dominate the construction outlook with 39% global share, mainly because of China`s development.
Source: IHS Construction industry by employment (2010-2014) Between 2010 and 2014 the number of employees in the construction market shows a growing tendency, from 356 million to almost 391 million.
Employees in the construction market, 2010-2014 (mill. capita) 400 390.14 390 380 370 364.82 360 356.1 351.5 348.6 350 340 330 320 2010 2011 2012 2013 2014
The change number of employees between 2010 and 2014 shows a steady growing tendency. Worldwide, the yearly average growth is 2,63%, which possibly will continue, because the experts predict a continuous expansion of the sector.
Source: Statista.com Construction industry by profit (2010-2014) The construction industry had 710 billion (€) profit in 2014, with a profit margin of 11.5% and its growth was 14.5% from 2013.
Profit Margin extreme values The Construction industry profit and growth from 2010 to 2014 (trillion €) Lowest Average Highest 0.8 20% 0.7 0.45% 10.89% 11.5% 0.71 15% 0.6 0.61 0.63 0.62 10% Q3 - 2008 0.5 0.56 Q3 - 2014 0.4 5% 0.3 0% The economic crisis at 2008 had a great 0.2 -5% negative impact on the profitability of the 0.1 construction industry, its profit margin 0 -10% 2010 2011 2012 2013 2014 Profit Growth was 0.45%. But a fast increase came, and it gained its highest point at 2014 with a profit margin of 11.5%
Source: CSImarket.com; prnews.com Top 5 construction companies (2014) The world‟s biggest 5 construction companies in 2015 are mainly situated in Beijing, China, just one of them is in Europe (France).
Top construction comp. by revenues and net income in 2014 (billion €) The headquarters of the world‟s top 5 companies
79.2 China State Constr. Engi. 3.12 72.9 China Railway Group 1.36 71.83 China Railway Constr. 1.47 51.48 Number of employees China Comm. Constr. 1.84 (100.000 capita) 38.7 VINCI 2.64 >2.5 2-2.5 <1-2
0.0 50.0 100.0 150.0 200.0 250.0
China State Construction Engineering is the most profitable construction company, with a € 3.12 billion profit. China Railway Group employ the biggest number of employees, approximately 2,5 times more than China 4 of the world’s biggest construction companies are in Comm. Constr.(about 294 thousand employees) Beijing, China and just one of them is in Rueil- Malmaison, France.
Source: forbes.com, portfoliu.hu, insidermonkey.com Top 5 construction companies (2009-2015) There hasn‟t been much change in the construction companies rankings, the 4 companies from China dominated in the last 5 years the global market.
Company 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2009-2015
China State Constr. China Railway Group 1 1
China Rail. Constr. 1 1 China Comm. Vinci 1 1 1 1
Chine Railway Group and China Railway Constructions switched place in 2011, but by the end of 2014 China Railway Group recovered its second position.
Source: enr.com, forbes.com 1. China State Construction Engineering Over 30 years, the company has achieved, by the end of 2013, its total contract value for overseas business of 64.56 billion € and total turnover of 79.15 billion €. Market share (%) Revenue (Billion €) 7.05 2014 79.150714
2013 64.7165
2012 60.58
2011 58.21 92.95 Company Other 0 20 40 60 80 100
3.12 Billion 216,824 79.15 Billion 120.48 Billion € € € 2. China Railway Group As one of the world‟s largest construction engineering contractors, China Railway Group Limited has been among the World Top 500 Enterprises for 10 years straight. Revenue (Billion €) Market share (%) 7.61 2014 72.85
2013 64.16
2012 55.82
2011 55.62 92.39 0 20 40 60 80 Company Other
1.36 Billion 293,592 72.58 Billion 88.1 Billion € € € 3. China Railway Construction CRCC, one of the world's most powerful and largest integrated construction group, ranking the 79th among the Fortune Global 500. Revenue (Billion €) Market share (%)
2014 71.83 7.05
2013 72.82
2012 59.47
2011 51.87 92.95 - 20.00 40.00 60.00 80.00 Company Other
1.47 Billion 249,624 71.83 Billion 79.6 Billion € € € 4. China Communications Construction The Company has actively participated in and competed for projects under external assistance and international contracting projects.
Revenue (Billion €) Market share (%) 7.89 2014 51.48
2013 46.66
2012 41.53
2011 41.38 92.11 Company Other 0 10 20 30 40 50 60
1.84 Billion 103,357 51.48 Billion 81.28 Billion € € € 5. VINCI VINCI is a global player in concessions and construction, employing more than 185,000 people in some 100 countries. Revenue (Billion €) Market share (%) 6.74 2014 38.7
2013 40.3
2012 38.63
2011 36.96 93.26 35 36 37 38 39 40 41 Company Other
2.64 185,293 38.7 62.08 Billion € Billion € Billion € Agenda
[Global] [Europe] [Romania]
Construction industry
Real Estate
industry
[
Cluj
Napoca ] Real estate industry overview- Global (2014) The real estate market total revenue in 2014 was € 9.73 trillion, reached through a 5,1% yearly average increase from 2010.
The top industries by revenue in 2014 Size of real estate industry in 2014 (trillion €) (%)
9.73 17.06
Real estate 9.36 GDP
6.15 82.94 3.5 3.34 2.14 1.54 1.37 Revenue 1.13
FMCG Automobile Banking The global real estate market is 9.73 trillion EUR in Utilities ICT Life Insurance size, accounting for 17.06% of the global GDP. Construction Oil and Gas Real estate
Source: prnewswire.com khl-group.com databank.org swissre.com statista.com Real estate industry by revenue (2010-2014) The global real estate industry`s size in 2010 was € 7,04 trillion , and with a CAGR of 6,7% it increased to € 9,73 trillion until 2014.
The Global Real Estate sector`s revenue and growth from 2009 to 2014 (trillion €)
12 14% 12% 10 10% 9.73 8% 8 8.62 7.91 6% 6 7.04 7.11 4% 2% 4 0% 2 -2% -4% 0 -6% 2010 2011 2012 2013 2014 Revenue Growth
The industry`s size was € 7,04 trillion in 2010, however it increased with a CAGR of 6,7% which represents € 2,68 trillion. With this growth the real estate industry achieved a revenue value of € 9,73 trillion.
Source: ibisworld.com; blackrock.com; pwc.com Real estate industry by revenue- forecast (2015-2019) The global real estate industry`s size was € 9,73 trillion in 2014, and it assumably will rise to € 14,24 trillion until 2019 with GAGR of 5,6%.
The Global Real Estate industry`s revenue and growth forecast from 2015 to 2019 (trillion €)
16 10% 14 8% 14.24 12 13.20 6% 12.30 11.65 10 10.84 4% 8 2% 6 0% 4 -2% 2 -4% 0 -6% 2015 2016 2017 2018 2019 Revenue Growth
Specialist predictions shows that the global real estate industry will have a revenue level of € 10,84 trillion in 2015. And with a CAGR of 5,6% it will reach € 14,24 trillion by 2019.
Source: blackrock.com; pwc.com; statista.com Real estate industry by profit (2010-2014) The global real estate industry profit registered growth at a 6% CAGR in the 2010-2014 period.
Global real estate profit, 2010-2014 (trillion €)
2 0.14 1.8 1.82 0.12 1.6 1.67 1.4 1.55 0.1 1.37 1.2 1.36 0.08 1 0.06 0.8
0.6 0.04 0.4 0.02 0.2 0.00 0 0 2010 2011 2012 2013 2014 Revenue Growth
The global real estate profit increased from € 1.36 trillion to € 1.82 trillion in 2014.
Source: globaltimes.com quora.com forbes.com Real estate industry by employement (2010-2014) The employment in the real estate sector shows a constant growth at a 2.8% CAGR in the 2010-2014 period.
Global real estate number of employees, 2010-2014 (thousand capita)
12,000 0.04
10,949 0.035 10,000 10,577 10,218 9,535 9,870 0.03 8,000 0.025
6,000 0.02
0.015 4,000 0.01 2,000 0.005 0.00 0 0 2010 2011 2012 2013 2014 Employees Growth
The total number of employees reached 10,949 thousand in 2014 with a yearly average growth rate of 3.5% between 2010 and 2014.
Source: ibisworld.com data.bls.gov statista.com Real estate industry by GFA* (2010-2014) The industry`s total useble floor area had a CAGR of 5.3%in the past 5 years. In 2014 it reached a value of 126,19 billion sqm.
The Global Real Estate industry`s total useble floor area from 2010 to 2014 (Billion sqm)
140 16% 14% 120 126.19 12% 100 111.35 10% 103.98 103.17 97.58 8% 80 6% 60 4% 2% 40 0% -2% 20 -4% 0 -6% 2010 2011 2012 2013 2014 풎^ퟐ Growth
The global real estate industry increased with a CAGR of 5.3%, based on GFA values. Considering the sector`s changes through the years, in 2014 occured the highest growth, 13.3% precisely. By 2014 the total useble floor area value of the sector reached the number of 126,19 billion sqm.
*GFA= gross floor area Source: BPIR.eu; FMI.com; KHL-group.com The privately owned real estate statistics Romania is the leading country regarding the privately owned real estates, while Switzerland is the first at the bottom.
Top 4 countries with the most privately Top 4 countries with the fewest privately owned real estate units owned real estate units 98.00% 60.00% 53.30% 54.20% 95.60% 51.00% 96.00% 50.00% 44.00% 40.00% 94.00% 92.20% 92.00% 30.00% 90.50% 90.10% 90.00% 20.00% 88.00% 10.00% 86.00% 0.00% Romani Lithuania Slovakia Singapore Switzerland Hong Kong Germany South Korea
We can observe that in countries where mobility is low, like Romania, people tend to live in their privately owned flats and houses. Complete opposites are Switzerland or Germany, where people are more mobile.
Source: eurostat.com, stats.govt.nz, cso.ie House prices worldwide (2014)
Monaco is the leader at house prices, having prices almost twice as much as the UK which is in the second place.
Buying Price (sqm in €) 50,000 44,522 45,000 40,000 35,000 30,000 25,575 25,000 20,000 18,499 13,639 15,000 11,866 10,784 10,000 7,250 6,932 5,930 4,078 3,442 2,807 2,748 5,000 1,771 891 0
The price of sqm is the highest in Monaco, the price is € 44,522.
Source: globalpropertyguide.com House prices worldwide (2014) Japan had the biggest growth regarding house prices, while in Ukraine, because of the unstable political environment the prices dropped almost 10%.
House price change in 2014 (%)
4 2.64 2.03 2 1.7 1.24 1.16 1.06 0.7 -0.14 -0.2 -0.32 -0.61 -0.06 -0.92 Ukraine 0 Japan United Australia United Malta Germany Russia Spain Romania Portugalia China France -2 Kingdom States Italy
-4
-6
-8
-10 -9.98
-12 House prices have changed the most in Ukraine, slumping 9,98%.
Source: globalpropertyguide.com The undeveloped real estate in the world (2014) The undeveloped real estate‟s overwhelming part is in China.
The world‟s unused real estates (%) The majority of the world’s unused real estate is 9.30% located in China. This can be explained by the fact 10.80% China that whole cities have become unlivable due to USA natural disasters, the dramatic change of working 17.80% zones or simply the chinese regime and the burocracy 62% Europe India made them unused.
There are no accurate data on the world’s unused real estates, but the situation in the USA, Europe and Asia gives a good representation.
Source: theguardian.com, bbc.com, businessinsider.com Top 5 real estate companies (2014) The leading company in 2014 was China Vanke with a € 18.18 billion revenue, but Brookfield Asset Management has the biggest profit (€ 2.35 billion) and Evergrande the most employees (77,057).
TOP 5 companies headquarters Top real estate companies by revenue in 2014 (billion €) 18.18 China Vanke 1.93
13.98 Brookfield Asset Management 2.35
13.76 Everagrande Real Estate 2.07 Number of employees 13.24 (10,000 capita) Poly Real Estate 1.49 >7 2-4 11.43 4-7 <1 Mitsui Fudosan 0.61
0.00 5.00 10.00 15.00 20.00
The 5 biggest companies cumulated revenue in 2014: € 70.59 bill, 7.1% from the global real industry revenue. The headquarters of 3 companies are in China, the other two are in Japan and Canada.
forbes.com Top 5 real estate companies (2010-2014)
China Vanke was the leading company of real estate market with a € 18.18 billion revenue.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
1. China Vanke 2 2
2. Brookfield Asset Management 1 1
3. Evergrande Real Estate 1 1 1 1 4. Poly Real Estate 1 1 1 1 5. Mitsui Fudosan 1 1 2 4
About 90 percent of Vanke’s projects were homes of less than 144 sqm in 2012, which helped it boost sales even as the government maintained property curbs, including tighter lending and restrictions on the number of homes people can own.
forbes.com bloomberg.com Top 5 real estate companies by profit (2010-2014)
The TOP 5 real estate companies ranking by profit was relatively stable in the 2010-2014 period. In 2010-2011 and 2012 Brookfield Asset Management was the leader.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
1. Brookfield Asset Management 2 2
2. Everagrande Real Estate
3. China Vanke 2 2 4. Poly Real Estate
5. Mitsui Fudosan
China Vanke full-year profit rose 30 percent in 2011-12 period as it sold more small and medium-sized homes that are less affected by government curbs. Brookfield Asset Management says 2013 was its best year in more than a century because it launched BPY in this year.
forbes.com business.financialpost.com bloomberg.com Top 5 real estate companies by employees (2010-2014)
The TOP 5 real estate companies ranking by employees was relatively stable in the 2010-2014 period. The leader is Evergrande Real Estate with more than 77 thousand employees.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
1. Evergrande Real Estate 2 2
2. China Vanke
3. Brookfield Asset Management 2 2 4. Poly Real Estate 1 1 5. Mitsui Fudosan 1 1
The biggest change was in 2011 when Evergrande Real Estate company employed more than 13,000 people and that caused the fall of Brookfield Asset Management in the ranking.
forbes.com securities.com statista.com research.omicsgroup.org 1. China Vanke
China Vanke operates in more than 60 Chinese cities and had a 1.8% market share with a 18.18 billion EUR revenue in 2014. Market share (%) Revenue and profit of China Vanke, 2010-2014 1.8 (billion €) 18.18 2014 16.68 2013 12.09 2012 8.07 2011 40,647 5.74 2010 98.2 China Vanke Other 0.00 5.00 10.00 15.00 20.00
Shenzhen, China RFR Holding LLC and Hines London property development CPP Investment Board Real-estate development projects in Hong Dalian Wanda Kong, Singapore, Los Angeles, and the New PAG Real Estate York City Tishman Speyer Properties Residential property venture in San Francisco (two residential towers in the city)
forbes.com quotes.wsj.com wsj.com cppib.com reuters.com bloomberg.com chinadaily.com vanke.com 2. Brookfield Asset Management
Brookfield Asset Management says 2013 was its best year in more than a century with a 15.69 billion EUR revenue and 1.60 billion EUR profit. Market share (%) Revenue and profit of Brookfield Asset 1.4 Management, 2010-2014 (billion €) 13.98 2014 15.69 2013 14.55 2012 11.44 2011 30,000 10.28 2010 98.6 Brookfield Asset Management Other 0.00 5.00 10.00 15.00
Headquarter: Subsidiaries: Mumbai-Nashik highway Toronto Brookfield Property Partners Six road and three power projects Other: New B. Infrastructure Partners from India York, Rio de B. Renewable Energy Partners Controls ports in England Janeiro, London, Du B. Capital Partners bai, Mumbai, Hong B. Investment Management Kong, Sydney B. Canada Office Properties
forbes.com brookfield.com indiatimes.com proactiveinvestors.com brookfieldofficeproperties.com 3. Evergrande Real Estate
Evergrande Real Estate Group is an integrated residential property developer with a 13.76 billion EUR revenue in 2014. Revenue and profit of Evergrande Real Market share (%) Estate, 2010-2014 (billion €) 1.4 13.76 2014 11.56 2013 8.13 2012 6.97 2011 5.13 77,057 2010 98.6 Everagrande Real Estate Other 0.00 5.00 10.00 15.00
Guangzhou, China Harvard University Education projects Chongqing government Chinese Estates Plaza Hotel properties Mass Mutual Tower, a prime office block Two developments in Wuhan Chinese Estates
forbes.com scmp.com law360.com mingtiandi.com 4. Poly Real Estate
Poly Real Estate engages in real estate development and had a 13.24 billion EUR revenue and 1.49 billion EUR profit in 2014. Market share (%) Revenue and profit of Poly Real Estate, 2010- 1.3 2014 (billion €) 13.24 2014 11.35 2013 8.51 2012 5.25 2011 27,290 4.02 2010 98.7 Poly Real Estate Other 0.00 5.00 10.00 15.00
Guangzhou, China AkzoNobel Decorative Paints Property development Commodity residential building distribution Property management businesses in China.
forbes.com bloomberg.com securities.com ccr.com 5. Mitsui Fudosan
Mitsui Fudosan is Japan‟s largest publicly traded real estate company with a total of 11.43 billion EUR revenue in 2014. Market share (%) Revenue and profit of Mitsui Fudosan, 2010- 1.2 2014 (billion €) 11.43 2014 13.13 2013 13.19 2012 11.79 2011 16,585 11.25 2010 98.8 Mitsui Fudosan Other 0.00 5.00 10.00 15.00
Tokyo, Japan Tokyo 2020 Unit Residential Development for Taconic Investment Manhattan’s West Side SJP Properties 42-story luxury apartment block in DLJ Real Estate Capital Manhattan Soon-to-be-vacated home of the British Broadcasting Corp. in London
forbes.com japantimes.com paralympic.org reuters.com wsj.com Real estate industry by sectors (2014) The overall global real estate industry worth 9,73 trillion (€) in 2014. The office sector peaks out from the global real estate market with 3,08 trillion (€) annual investment and 32% market share.
The real estate industry sectors by revenue 2014 The real estate industry sectors share 2014 (trillion €) (%)
Office 1.19 Office 12 Residential 3.08 Residential 31 Retail 1.19 12 Retail Hospitality Hospitality Industrial Industrial 1.79 18 2.48 25
The real estate market amounted for € 9,73 trillion in 2014. The offices sector generated the highest revenue €3,08 trillion. Following it is the residential sector with € 2,48 trillion ,the retail sector has € 1,79 trillion , the hospitality sector worth € 1,19 trillion and finally the industrial sector with € 1,19 trillion.
Source: Jll.com, realestate.bnpparibas.com; blackrock.com Real Estate industry by sectors- forecast (2019) The global Real Estate industry will have will worth € 14,24 trillion by 2019. The office sector will remain the leader, and the hospitality will become the last
The real estate industry sectors by revenue 2019 The real estate industry sectors share 2019 (trillion €) (%)
Office 1.78 Office 12 Residential Residential 4.39 30.8 Retail 1.83 Retail 12.8 Industrial Industrial Hospitality Hospitality 2.53 17.7
3.71 26.7
Presumably the global Real Estate industry will amount for € 14,24 trillion. The office sector will remain the leading one with a revenue value of € 4,39 trillion, the residential will be the second with € 3,71 trillion, the third one will be the retail sector with € 2,53 trillion. The following sector will be the industrial with € 1,83 trillion, and the last one will be the hospitality with a revenue value of €1,78 trillion.
Source: FMI outlook, JLL.com Residential sector by revenue (2010-2014) The second sector`s revenue grew through the last 5 years by a CAGR of 7.1%. The increase started picking up pace in 2011,in 2013 its growth was 19% and in 2014 it reached a revenue of € 2.48 trillion.
The Residential real estate sector`s revenue and growth from The real estate industry sectors share 2014 2009 to 2014 (trillion €) (%) 3 25%
2.5 20% Other 2.41 2.48 15% 2 27 2.02 10% Residential 1.5 1.76 1.78 5% 1 0% 0.5 -5% 75 0 -10% 2010 2011 2012 2013 2014 Profit Growth
The residential sector shows a stabile growth rate from 2010. Its revenue increased slowly, with an average growth of 5.5% until 2013, when it jumped up to €2.41 trillion, with a growth rate of 19%. In 2014 the rising process continued and the sector`s revenue peaked at € 2.48 trillion.
Source: FMI outlook Residential sector by revenue- forecast (2015-2019) The global residential sector will perform with an estimated CAGR of 6,7%, and by 2019 it will reach a revenue of € 3,71 trillion.
The Residential real estate sector`s revenue and growth forecast from 2015 to 2019 (trillion €) 4 10%
3.5 3.71 8% 3 3.41 6% 3.13 2.89 2.5 2.68 4% 2 2% 1.5 0% 1 -2% 0.5 -4% 0 -6% 2015 2016 2017 2018 2019 Revenue Growth
The residential sector from 2015 will increase in a stable manner with a minimum growth rate of 8%. The CAGR in this forecast is 6,7% and if it occures, by 2019 the residential sector will have a revenue of € 3,71 trillion. This values will be enough for the sector to protect its second place in the real estate industry with it`s share of 26%.
Source: FMI outlook Residential sector by profit (2010-2014) The residential sector‟s profit grew with more than 20% percent between 2012 and 2014 thank to big revenue growth having a CAGR of 5.8%
The residential real estate sector`s profit (billion €) 500 20% 450 463.00 472.00 400 15% 350 398.00 356.00 362.00 10% 300 250 5% 200 150 0% 100 -5% 50 0 -10% 2010 2011 2012 2013 2014 Profit Growth
With a profit margin of 20.9% between the 5 years, the residential sector is one of the most profitable one, thanks to constant investments an rising prices all around the world.
Source: FMI outlook Top 4- residential sector (2010-2014) The Top 4 companies are dominated by Realogy Holding Corp. which is a huge company compared to the others. All of these companies are located in the United States.
TOP 4 companies headquarters Top 4 residential real estate holders by revenue and profit, 2014 (million €)
136 Keller Williams Realty International
155 Home Services America
260 Zillow
4262 Realogy Holding Corp
-1000 0 1000 2000 3000 4000 5000
The second company is Zillow, which has registered losses in the last couple of years, but it is important to mention, that Zillow’s revenue has grown tenfold in the last 5 years, which is an impressive accomplishment.
Source: sec.gov; amigobulls.com; last10k.com; swanepoel.com Top 4- residential sector (2010-2014)
Realogy Holding Corp is a huge company so this way it easily keeps the leading position in this category.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
1. Realogy Holding Corp
2. Zillow 1 1 2
3. Home Services America 1 1 Keller Williams Realty 4. 1 International 1
Zillow has made huge improvements and by increasing their revenues tenfold they managed to get into the 2nd position. Keller Williams Realty International is the company with the most agents beating the 95000 count in 2014.
Source: sec.gov; amigobulls.com; last10k.com; swanepoel.com Residential sector by GFA (2010-2014) The global residential sector`s gross floor area had a CAGR of 5%in the past 5 years.In 2014 the sector reached a value of 91.98 billion sqm.
The Residential real estate sector`s total useble floor area from 2010 to 2014 (billion sqm) 100 16% 90 14% 91.98 80 12% 81.03 10% 70 75.92 74.46 72.11 8% 60 6% 50 4% 40 2% 30 0% 20 -2% 10 -4% 0 -6% 2010 2011 2012 2013 2014 풎^ퟐ Growth
The second sector GFA changes were stabel, the CAGR equaling 5%. Considering the growth rates through the years, the biggest jump occurred in 2013, 13.5% precisely. By 2014 the global residential sector reached the surface of 91.98billion sqm.
Source: BPIR.eu; FMI.com; KHL-group.com Office sector by revenue (2010-2014) The leading sector`s revenue remained stabile throughout the years, with a CAGR of 3.5%. It was in the worst position at 2011, with € 2.46 trillion, since then it increased until 2014, to € 3.08 trillion, with a 19% growth rate.
The Residential real estate sector`s revenue and growth from The real estate industry sectors share 2014 2009 to 2014 (trillion €) (%) 3.5 25% 3 20% 3.07 2.5 15% Other 2.59 2.46 2.59 2.59 2 10% 31 Office 1.5 5% 1 0% 0.5 -5% 69 0 -10% 2010 2011 2012 2013 2014 Profit Growth
The economic crisis became perceptible around 2009 in the office sector. 2011 was the worst year, with a 5% decrease and a revenue of € 2.46 trillion. But soon after this downfall the sector became stable, and in 2014 with a 19% increase it reached a total revenue of € 3.07 trillion, which is more than enough to remain the leading real estate sector.
Source: FMI outlook Office sector by revenue- forecast (2015-2019) According to industry sources the global office sector will grow by a CAGR of 5,2%, and by 2019 it will reach a revenue of € 4,39 trillion.
The Office real estate sector`s revenue and growth forecast from 2015 to 2019 (trillion €) 5 10% 4.5 8% 4 4.39 6% 3.5 4.03 3.62 3.76 3 3.41 4% 2.5 2% 2 0% 1.5 -2% 1 0.5 -4% 0 -6% 2015 2016 2017 2018 2019 Revenue Growth
The global office sector will perform well in the near future, it will increase stabily with a CAGR of 5,2%. The slowest growth rate will be a 4% that will occure in 2017. Despite that, by 2019 the office sector`s revenue will reach a value of € 4,39 trillion and it will still be the leading sector in the real estate industry with a share of 31%.
Source: FMI outlook Office sector by profit (2010-2014) The office sector‟s profit grew with 15% percent between 2013 and 2014, having an annual average growth of 3.2%.
The Office real estate sector`s profit (billion €) 350 20%
300 312.00 15% 250 266.00 272.00 246.00 255.00 10% 200 5% 150 0% 100
50 -5%
0 -10% 2010 2011 2012 2013 2014 Profit Growth
The office sector had a fluctuated growth, remaining almost constant within the years, but with a significant growth of 15% in the last year due to big investments, it had an average growth of 3.2% during the five years.
Source: FMI outlook Top 5- office sector (2014) This sector is the most varied in geographical distribution. Brookfield and Ivanhoe are based in Canada, Hines and Blackstone are from the US, and KBS is from South Korea.
TOP 5 companies headquarters Top 5 office real estate holders by revenue and profit, 2014 (million €) 188 KBS 456 Hines 1620 Ivanhoe Cambridge 7484 Blackstone Group 2372 Brookfield Office Properties
-1000 1000 3000 5000 7000 9000
Blackstone Group is the leader in revenues, but Brookfield Office Properties works with a higher margin. KBS is the only company which registered losses in 2014, but Hines also was not profitable in the last few years ending its’ streak with 2014.
Source: nreionline.com; brookfieldofficeproperties.com; cloudfront.net; ir.blackstone.com; reitcanada.com; hinessecurities.com; last10k.com Top 5- office sector (2010-2014)
Blackstone Group has been a stabile leader in this category, they have doubled their revenues in this 4 year period, in 2014 they managed to beat the 7 billion mark.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
1. Blackstone Group
2. Brookfield Office Properties
3. Ivanhoe Cambridge
4. Hines
5. KBS
The competition was entirely static in the last four years. KBS and Hines have relatively small numbers compared to these companies. The only tension was between the 2nd and 3rd positions, but Brookfield Office Properties have successfully kept their position.
Source: nreionline.com; brookfieldofficeproperties.com; cloudfront.net; ir.blackstone.com; reitcanada.com; hinessecurities.com; last10k.com Office sector by GFA (2010-2014) The global office sector`s total useble floor area had a CAGR of 6.5% in the past 5 years. In 2014 the sector reached a value of 11.09 billion sqm.
The Office real estate sector`s total useble floor area from 2010 to 2014 (billion sqm) 12 20%
10 11.09 15% 9.45 9.70 8 9.15 10% 8.10 6 5%
4 0%
2 -5%
0 -10% 2010 2011 2012 2013 2014 풎^ퟐ Growth
The leading global real estate sector increased by a CAGR of 6.5%, based on GFA values. Considering the changes through the years, 2014 steps out with the highest growth rate of 14%. By 2014 the sector`s GFA will have reached a number of 11.09 billion sqm.
Source: BPIR.eu; FMI.com; KHL-group.com Retail sector by revenue (2010-2014) The commercial sector has a CAGR of 7.5%, and showed a stable increase from 2010. At 2014 it reached a revenue of € 1.79 trillion, with a 12% growth.
The Retail real estate sector`s revenue and growth from 2009 to The real estate industry sectors share 2014 2014 (trillion €) (%) 2 14% 1.8 12% 1.6 1.79 10% 1.4 1.60 8% Other 1.48 18 1.2 1.33 6% 1.25 1 4% Retail 0.8 2% 0.6 0% 0.4 -2% 0.2 -4% 0 -6% 82 2010 2011 2012 2013 2014 Profit Growth
The retail sector from it`s revenue of € 1.25 trillion at 2010 increased steadily. The highest growth rate of 12% occurred recently in 2014, and resulted in a revenue of € 1.79 trillion. The CAGR of the retail sector between 2010 and 2014 was 7.5%.
Source: FMI outlook Retail sector by revenue- forecast (2015-2019) The global retail sector is expected to perform with CAGR of 4,6%, and by 2019 it will reach a revenue value of € 2,53 trillion.
The Retail real estate sector`s revenue and growth forecast from 2015 to 2019 (trillion €) 3 8%
2.5 6% 2.53 2.38 4% 2 2.16 2.25 2.02 2% 1.5 0% 1 -2% 0.5 -4% 0 -6% 2015 2016 2017 2018 2019 Revenue Growth
According to the forecast the retail sector will increase steadily as well, with a CAGR of 4,6%. The highest growth rate is estimated to occure in 2016, with a 7% annual increase. Presumably by 2019 the sector revenue will be € 2,53 trillion, which will result in a 18% share in the global Real Estate industry.
Source: FMI outlook Retail sector by profit (2010-2014) The retail sector‟s profit grew constantly in the past 5 years, with an average of 7.4% during the years.
The retail real estate sector`s profit (billion €) 600 20%
500 556.00 15% 512.00 486.00 400 10% 389.00 410.00 300 5%
200 0%
100 -5%
0 -10% 2010 2011 2012 2013 2014 Profit Growth
The retail sector is the first subsector which hat constant growth of profit, with almost 20% between 2011 and 2012, and has the second largest profit rate of almost 30%.
Source: FMI outlook Top 5- retail sector (2014) All of these 5 companies have their headquarters in the United States. Simon Property Group has around 5000 employees, but all of the other companies have 1600 or less listed employees.
TOP 5 companies headquarters Top 5 retail real estate holders by revenue and profit, 2014 (million €) 988 Brixmor Property Group 809 Kimco Realty Corp. 788 DDR Corp. 2448 General Growth properties 3896 Simon Property Group
0 1000 2000 3000 4000 5000 6000
By revenue Simon Property Group was the leader with almost 4000 million euros, but the best profit margin was at General Growth properties with 73% in 2014.
Source: Thomson.mobular.net; media.corporate-ir.net; investor.ggp.com; files.shareholder.com; investors.kimcorealty.com; snl.com Top 5- retail sector (2010-2014)
The competition has been completely static, despite the fact that Simon Property group has declined in the last year it still easily keeps the first position
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
1. Simon Property Group
2. General Growth Properties
3. Brixmor Property Group
4. Kimco Realty Corp.
5. DDR Corp.
The two closest companies are Kimco Realty Corp. and Brixmor Property Group, their revenues have been on a steady incline but Kimco Realty Corp. is closing the gap.
Source: Thomson.mobular.net; media.corporate-ir.net; investor.ggp.com; files.shareholder.com; investors.kimcorealty.com; snl.com Retail sector by GFA (2010-2014) The global retail sector`s gross floor area had a CAGR of 6.1%in the past 5 years. In 2014 the sector reached a value of 6.68billion sqm.
The Retail real estate sector`s gross floor area from 2010 to 2014 (billion sqm) 8 20% 7 15% 6 6.68 6.10 10% 5 5.51 5.78 4 4.80 5% 3 0% 2 -5% 1 0 -10% 2010 2011 2012 2013 2014 풎^ퟐ Growth
The global retail sector increasedby a CAGR of 6.1%, based on GFA values. Considering the sector`s changes through the years, 2011 had the highest growth rate, 14.8% precisely. By 2014 the gross floor area reached the 6,68 billion sqm.
Source: BPIR.eu; FMI.com; KHL-group.com Industrial sector by revenue (2010-2014) The industrial sector performed with a CAGR of 6.2%. From 2010 with a revenue of € 0.88 trillion, it increased to € 1.19 trillion, which is 38.63% of the office sector`s revenue.
The Industrial real estate sector`s revenue from 2009 to 2014 The real estate industry sectors share 2014 (trillion €) (%) 1.4 20%
1.2 15% 1.19 Other 1 12 1.02 1.03 10% 0.8 0.88 0.87 5% Hospitality 0.6 0% 0.4 0.2 -5% 0 -10% 88 2010 2011 2012 2013 2014 Profit Growth
The industrial sector had a decrease of 2% in 2011, but from then it started to perform better. The CAGR of the sector is 6.2%, but it is not stable. In 2012 it had a growth of 18%, the next year 0.5% and in 2014 its revenue increased by 16%, reaching a total amount of € 1.19 trillion, which is 38.63% of the industry leading office sector`s revenue.
Source: FMI outlook Industrial sector by revenue- forecast (2015-2019) Presumably the global industrial sector will perform with CAGR of 5,6%, and by 2019 it will reach a revenue value of €1,83 trillion, and will overtake the hospitality sector.
The Industrial real estate sector`s revenue and growth forecast from 2015 to 2019 (trillion €) 2 10% 1.8 1.83 8% 1.6 1.71 1.59 6% 1.4 1.50 1.2 1.39 4% 1 2% 0.8 0% 0.6 -2% 0.4 0.2 -4% 0 -6% 2015 2016 2017 2018 2019 Revenue Growth
According to the forecast the global industrial sector will grow steadily, with a CAGR of 5,6%. The highest growth rate presumably will be 8% and will occur in 2016. This increase by 2019 will result in a revenue value of € 1,83 trillion, which will be enough for a total share of 13% in the global real estate industry.
Source: FMI outlook Industrial sector by profit (2010-2014) The industrial sector‟s profit grew with 20% in 2012, the biggest growth in the past 5 years, having a CAGR of 5.2 between 2010-2014.
The industrial real estate sector`s profit (billion €) 400 20% 350 378.00 15% 344.00 300 337.00 10% 250 293.00 288.00 200 5% 150 0% 100 -5% 50 0 -10% 2010 2011 2012 2013 2014 Profit Growth
The industrial sector is the most profitable subsector from the five, with almost 3% more than the retail sector, having a profit margin of 33%.
Source: FMI outlook Top 5- industrial sector (2014) These companies are all based in the US. From these 5 companies Prologis is the leader in revenues and profits and also has the highest profit margin.
TOP 5 companies headquarters Top 5 industrial real estate holders by revenue and profit, 2014 (million €) 3256.6 USAA Real Estate Company 633.6 Liberty Property Trust 268.8 Dct Industrial Trust 931.2 Duke Realty 1408.8 Prologis
0 500 1000 1500 2000 2500 3000 3500 4000 4500
USAA Real Estate Company being a subsidiary of a huge holding company does not have separately registered numbers, but by total owned property it ranks in the top 5.
Source: nreionline.com; ir.prologis.com; sec.gov; phx.corporate-ir.net Top 5- industrial sector (2010-2014)
USAA Real Estate Company leads the competition by a huge margin and it is followed by Prologis with a revenue of 1.7 billion €.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
1. USAA Real Estate Company
2. Prologis 1 1
3. Duke Realty 1 1 4. Liberty Property Trust
5. DCT industrial trust
While Prologys has doubled its revenues in the last 4 years Duke Realty has kept its 2011 numbers despite having a spike of 50% in revenues in 2011.
Source: nreionline.com; ir.prologis.com; sec.gov; phx.corporate-ir.net Industrial sector by GFA (2010-2014) The global industrial sector`s gross floor area had a CAGR of 6% in the past 5 years. In 2014 the sector reached a value of 9.83billion sqm.
The Industrial real estate sector`s gross floor area from 2010 to 2014 (billion sqm) 12 12% 10% 10 9.83 8% 8 8.86 6% 8.10 8.08 7.36 4% 6 2% 4 0% -2% 2 -4% 0 -6% 2010 2011 2012 2013 2014 풎^ퟐ Growth
The global industrial sector grewby a CAGR of 6%, based on GFA values. Considering the changes through the past years, 2011 had the highest growth rate, 12.1% precisely. By 2014 the sector reached a gross floor area value of 9.83billion sqm.
Source: BPIR.eu; FMI.com; KHL-group.com Hospitality sector by revenue (2010-2014) The hospitality sector performed with a CAGR of 16.1% and grew by € 0.62 trillion from 2010, reaching a revenue of €1.19 trillion in 2014, equal to the industrial sector`s value.
The Hospitality real estate sector`s revenue and growth from 2009 1.4 30% The real estate industry sectors share 2014 to 2014 (trillion €) (%) 1.2 25% 1.19 20% 1 1.00 15% Other 0.8 12 0.80 10% 0.6 Hospitality 0.67 5% 0.57 0.4 0% 0.2 -5%
0 -10% 88 2010 2011 2012 2013 2014 Profit Growth
The hospitality sector revenue values showed a major growth rate. From 2010 it started with € 0.56 trillion, but it gained more and more revenue every year, its CAGR was 16.1%. The highest growth rate was 25% in 2013, and the revenue reached it`s peak at 2014 with a value of € 1.19 trillion.
Source: FMI outlook Hospitality sector by revenue- forecast (2015-2019) The hospitality sector will perform with an estimated CAGR of 5,9%, and by 2019 it will reach a revenue value of € 1,78 trillion.
The Hospitality real estate sector`s revenue and growth forecast from 2015 to 2019 (trillion €) 2 12% 1.8 10% 1.78 1.6 1.68 8% 1.4 1.57 1.47 6% 1.2 1.33 4% 1 2% 0.8 0.6 0% 0.4 -2% 0.2 -4% 0 -6% 2015 2016 2017 2018 2019 Revenue Growth
The hospitality sector will have a bit slower increase with a CAGR of 5,9%. In 2016 it even reaches a growth rate of 10%, which by 2019 becomes 6%. However this rate is only enough for the sector to reach a revenue value of € 1,78 trillion that year. With this number the sector cannot hold its previous position in the Real Estate industry and probably will fall and become smallest sector.
Source: FMI outlook Hospitality sector by profit (2010-2014) The hospitality sector‟s profit was the lowest in 2010 and it grew to € 91 billion by 2014.
The hospitality real estate sector`s profit (billion €) 100 12% 90 10% 91.00 80 82.00 8% 70 75.00 6% 60 68.00 64.00 4% 50 2% 40 30 0% 20 -2% 10 -4% 0 -6% 2010 2011 2012 2013 2014 Profit Growth
The hospitality sector’s profit grew by 27 billion € from 2010 to 2014. The growing was not continuous, it dropped from 2012 to 2013 but retook it’s growing form after this year. In 2014 the hospitality sector’s profit was € 91 billion.
Source: FMI outlook Top 5- hospitality sector (2014) From the Top 5 companies only Accor, with its headquarters in France, is not located in the United States. These companies own and are franchisers of several brands, aimed at different consumers.
TOP 5 companies headquarters Top 5 hospitality real estate holders by revenue and profit, 2014 (million €) 1486.4 Intercontinental Hotels Group 520.8 4240 Wyndham Hotel Group 423.2 8400 Hilton Worldwide 538.4 11040 Marriot international 540 5454 Accor 240
0 2000 4000 6000 8000 10000 12000 14000
It is hard to define how many employees work for these companies because of the many types of different hotel franchising, but we can easily put these numbers above 100.000 in most of these cases.
Source: nreionline.com, pages.questexweb.com, accorhotels-group.com, bib.kuleuven.be, ihgplc.com, statista.com, networkworld.com, annual reports, marriot.com, shareholder.com, investor.wyndhamworldwide.com, amigobulls.com Top 5- hospitality sector (2010-2014)
Not only the competition is entirely static, but the differences are huge between these companies. Marriot International leads by 2.5 billion.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
1. Marriot International
2. Hilton Worldwide
3. Accor
4. Wyndham Hotel Group
Intercontinental Hotels 5. Group
Both Marriot International and Hilton Worldwide have managed to increase their revenues by more than 2.5 billion euro and have distanced themselves even more from the competition.
Source: nreionline.com, pages.questexweb.com, accorhotels-group.com, bib.kuleuven.be, ihgplc.com, statista.com, networkworld.com, annual reports, marriot.com, shareholder.com, investor.wyndhamworldwide.com, amigobulls.com Hospitality sector by GFA (2010-2014) The global hospitality sector`s gross floor area had a CAGR of 4.3%in the past 5 years. In 2014 the sector reached a value of 6.43billion sqm.
The Hospitality real estate sector`s total useble floor area from 2010 to 2014 (billion sqm) 7 16% 14% 6 6.43 12% 5 5.66 10% 5.21 5.30 5.40 8% 4 6% 3 4% 2% 2 0% -2% 1 -4% 0 -6% 2010 2011 2012 2013 2014 풎^ퟐ Growth
The global hospitality sector increased with a CAGR of 4.3%, based on GFA values. Considering the sector`s changes through the years, the highest growth occurred in 2011. By 2014 the total useble floor are value of the sector reached the number of 6.43billion sqm.
Source: BPIR.eu; FMI.com; KHL-group.com Global Real Estate market summary
2010-2014 2015-2019 Largest RE companies
Big RE companies 4.1% 5.6% Revenue
Emerging countries Real Estate Real
Total Total Profit 6%
Revenue Profit GFA Top companies Headquarters Revenue
5% 5%5% Residential Realogy Holdong Corp US € 4.26 billion 27% 31% 27% 8% 30% Balckstone Group US € 7.48 billion 9% Office
12% Retail Simon Property Group US € 3.89 billion 18% 73% 12% 18% 20%
Industrial USAA Real Estate Company US € 3.25 billion R.E. Subsectors R.E. Hospitality Marriot International US € 11.04 billion Agenda
[Global] [Europe] [Romania]
Construction Construction industry industry
Real Estate
industry
[
Cluj
Napoca ] Construction industry overview - Europe The Construction industry‟s total turnover in 2014 was €1.661 billion and provided 11,93% of the total GDP in Europe.
European industries by sales/turnover in 2014 Size of Construction industry in 2014 (€ billion) (€ billion)
695.14 1,661
843.4 Construction industry GDP of Europe
913.68 Utilities 13,921 Automotive ICT 1074.72 Banking Construction Europe’s GDP – by Purchasing Power Parity – in 1661 2014 was €13.921 billion compared with other significant industries, the Construction sector Turnover provided 11,93% of the total GDP.
Source: ec.europa.eu/eurostat, khl-group.com, cia.gov, Construction industry by revenue (2010-2014) The European construction sector‟s market size by revenue was €1.661 billion in 2014; with this revenue, the sector made up 24% of the world‟s total production.
The construction sector market size and percentage growth in Europe - by revenue. (2010-2014, €bn) 2000 8.00 181.2 177.92 176.29 171.18 174.67 5.79 6.00 1500 4.00 2.49 2.00 24% 24% 1000 1.00 1625.36 1665.82 1650.58 1570.06 1661 0.00
-0.91 Growth 34% Turnover 500 -2.00 -4.00 -4.88 0 -6.00 2010 2011 2012 2013 2014
Contruction Gross Operating Surplus Growth
The construction sector saw an increase in 2011, after this year it was characterized by volatility. After the recession, the number of the new buildings decreased. Despite this decrease, Europe is still one of the biggest markets in the global playing field, with 24% market share. In addition, the sector reached 10,03-11,12% Gross Operating Surplus.
Source: ec.europa.eu, ebc-construction.eu, khl.com, cia.gov Construction industry by revenue- forecast (2015-2020) Considering that the construction industry totals up to 11,93% of Europe‟s GDP, its growth has a significant importance.
The European construction industry‟s revenue Europe GDP distribution (2014, %) 1550 forecast, (2015-2020, %) 4,2% 1500 3,6% 1450 2,9% 11,93% 1400 2,2% 2,2% 1350 Construction industry 1300
1250 88% Other sectors 1200 2015 2016 2017 2018 2019 2020
According to the forecasts, the European construction industry will grow, on average, by 3% per year.
Source:forbes.com;Ec europa.eu;Buildingradar.com The construction industry profit between 2010-2014 The construction industry gross profit growth constantly between 2010-2014. The highest value in this period was in 2014 with 280.46 billion(€). The CAGR was 7.18% in this period
Construction industry gross profit 2010-2014 (billion EUR) 300.00 280.46 14.00% 257.49 273.97 12.00% 250.00 229.55 212.92 12.2% 10.00% 200.00 8.00% 150.00 7.8% 6.00% 100.00 6.4% 4.00%
50.00 2.37% 2.00%
0.00 0.00% 2010 2011 2012 2013 2014
The construction industry gross profit growth constantly between 2010-2014. The gross profit in 2014 was over 280 million(€) and the CAGR is 7.18% in this period.
Source: ec.europa.eu, csimarket.ro; Construction industry by employment (2010-2014) With 10 million employees, the Construction industry has a 4.43% share of the workforce.
Number of employees and percentage growth in the Construction industry employees compared to European Construction sector (mil. capita, 2010-2014) total employment in Europe (mil. Capita, 2014) 10.8 4.00% 3.10% 10.6 2.00% 10 10.4 10.2 0.00% -0.01% 0.00% 10 -2.00% 10.66 10.65 -2.90%
Growth Construction industry 9.8 10.34 -4.00% 9.6 10 Europe total 9.7-6.20% -6.00%
Number of employees of Number 9.4 9.2 -8.00% 2010 2011 2012 2013 2014 225.74
Contruction Growth
The number of employees in the construction sector has been in a continuous decrease.
Source: ec.europa.eu/eurostat, khl-group.com, cia.gov, Top 5 construction companies (2015) The five largest european construction companies in first half year of 2015 have a total market share of € 89,59 billion.
TOP 5 construction companies headquarters Top construction companies by portfolio value in 2015(billion €) 40.4 Skanska 18.13 Vinci 17.86 ACS Number of employees(thousand) 7.5 Bouygues >150 <60 5.7 60-100 100-150 Hochtief
0 20 40
Skanska is the market leader with € 40,4 billion in turnover and € 1,7 billion in profit, therefore Skanksa is also the runner-up in terms of employees, with 185.000 people.
Source: buildig.co.uk ; no1construction.com ; statista.com 1. Skanska The first construction company by turnover is Skanska with € 17 billion.
Revenue and profit, 2012-2015 Market share, 2015 (%) (billion €) 2.41 20 17.0 1 15.0 15.3 15.9 15 1 0.6 10 0 0.3 0.4 5 0.4 0 57 866 0 0 2012 2013 2014 2015 97.59 Turnover Profit
Stockholm, Sweden Silesia Business Park, Green Court, Katowice Bucharest
Source: market.ft.com; group.skanska.com 2. Vinci The second construction company by turnover is Vinci with € 38,24 billion.
Revenue and profit, 2012-2015 Market share, 2015 (%) (billion €) 1.09 50 3 38.63 40.33 39.04 38.24 40 3 1.91 2 30 1.96 2.48 1.99 2 20 1 185 293 10 1 0 0 2012 2013 2014 2015 98.91 Turnover Profit
Constructora Rueil-Malmaison, Quatari Diar Conconcreto, France Colombia
Source: markets.ft.com; vinci.com 3. ACS Group The third construction company by turnover is ACS Group, with € 35,9 billion.
Revenue and profit, 2012-2015 Market share, 2015 (%) (billion €) 1.08 50 3 38.4 35.9 40 1.9 35.2 34.9 2 30 2 20 1.4 1 210 345 10 0.7 1 0 0.7 0 2012 2013 2014 2015 98.92 Turnover Profit
Madrid, Spain Santander Group IATA Strategic Partner Program
Source: markets.ft..com; 4. Bouygues The fourth construction company by turnover is Bouygues, with € 34,2 billion.
Revenue and profit, 2012-2015 Market share, 2015 (%) (billion €) 0.52 40 1 33.5 33.1 33.1 34.2 1 30 0.85 0.63 0.75 1 20 0.8 0 10 0 127 470 0 0 2012 2013 2014 2015 99.48 Turnover Profit
Paris, France Altice, France M&A, France
Source: markets.ft.com; 5. Hochtief The fifth construction company by turnover is Hochtief with € 5,7 billion.
Revenue and profit, 2012-2015 Market share, 2015 (%) (billion €) 0.34 30 25.5 0 22.5 22.1 22.8 25 0.27 0 20 0 0.25 15 0.15 0.17 0 10 0 68 426 5 0 0 0 2012 2013 2014 2015 99.66 Turnover Profit
Essen, Germany Aecon Group, Canada ILO Conventions
Source: markets.ft.com Agenda
[Global] [Europe] [Romania]
Construction Construction industry industry
Real Estate Real Estate
industry industry
[
Cluj
Napoca ] Real estate industry overview- Europe, 2014 The real estate industry‟s total revenue in 2014 was €490,09 billion which means a contribution of 3,52% to the GDP.
The size of the real estate industry in 2014, Top industries in Europe by turnover (%) (2014, bn €) 3.52
1601 Real Estate Industry GDP in Europe 695.14 Construction Utilities 843.4 Automotive ICT 96.48 913.68 Banking Real estate Europe’s total GDP in 2014 ( by Purchasing 1074.72 Power Parity) was €13.921 trillion. Real estate 490.09 industry has 3,52% share of total GDP. Turnover
Statista.com, Eurostat.com, europeanrealestateforum.eu Real estate industry by revenue (2010-2014) After the property bubble in 2007 caused by low mortgage interest rates, low short-term interest rates, low standards for mortgage loans, the real estate industry started picking up pace in 2010. The investment market drivers are weight of capital, increasing debt leverage and new “innovative” financial products.
Real estate by revenue in Europe (2010-2014, € billion)
500 490.09 490 486.42 480.48 480
470
460 454.82 450 445.39 440
430
420 2010 2011 2012 2013 2014
In the real estate industry there was a significant increase - 6,95% - between 2011 and 2012. Between 2013 and 2014 this market increased only by 2%, reaching more than €490 billion.
Eurostat.com, Colliers.com, jll.com Real estate industry by profit (2010-2014) The European real estate market‟s gross profit in 2014 was €124,07 billion. This indicator increased with a CAGR of 7,65 %.
Real estate by profit in Europe (2010-2014, € billion)
140.00 124.07 120.00 116.25 112.92 98.78 100.00 93.22
80.00
60.00
40.00
20.00
0.00 2010 2011 2012 2013 2014
The European real estate market’s average profit margin between 2010 and 2014 was 7,65%. 2012 and 2014 was an exceptional year in RE business, back then were the highest grow rates.
Source: telegraph.co.uk Real estate industry by employment (2010-2014) Between 2010 and 2014 the global growing tendency in the number of employees was followed by the European one. In 2014 the number of employees in this industry reached 2,86 million capita.
Real estate by number of employee in Europe (2010-2014, million capita)
3.50
3.00 2.86 2.62 2.75 2.45 2.50 2.31 2.00
1.50
1.00
0.50
0.00 2010 2011 2012 2013 2014
Since 2010 the number of employees in European real estate market showed a growth of 5,49% CAGR.
Source: ec.Europa.eu Real estate industry by revenue- forecast (2016-2019) After the property bubble in 2007 caused by low mortgage interest rates, low short-term interest rates, low standards for mortgage loans the real estate industry started picking up pace in 2010. The investment market drivers are weight of capital, increasing debt leverage and new “innovative” financial products.
Real estate forecast in Europe (2016-2019, € billion) 800 744 682.57 700 626.21 600 574.51
500
400
300
200
100
0 2016 2017 2018 2019
Forecasters raised their estimates for the European Real Estate annual return between 2015 and 2019 to 9% from 8,7%. * Real estate markets are cyclical: their peaks will be followed by troughs and inversely.
Eurostat.com, Colliers.com, jll.com Top 5 real estate companies (2014) The largest real estate companies are involved in at least two segments of real estate. Examining these companies by headquarters there is a revealing tendency: France and UK are the leader countries in RE.
TOP 5 companies by headquarters Top 5 real estate companies by portfolio value in 2014 (billion €) 12.11 British Land 12.76 Deutsche Annington 12.9 Number of employees Intu Properties (thousand capita) 21 >1 Klepierre <1 35.7 Unibail-Rodamco
0 10 20 30 40
The 5 biggest companies’ cumulated portfolio value in 2014: € 94,47 billion The biggest employer is Unibail-Rodamco with 2085 employee which is followed by Klepierre with 1598 employee.
Source: epra.com; Annual reports 1. Unibail Rodamco Unibail Rodamco is the second european retail real estate company by revenue with € 492,3 million. This company has 4,23% share in French retail market.
Revenue and profit, 2011-2015 French retail property market share(%) (million €) 4.23% 600 500 492.3 500 419.0 395.0 400 400 362.1 328.6 322.0 300 300 200 200 137.5 100 149.5 166.3 100 2085 0 159.6 0 95.77% 2011 2012 2013 2014 2015 Turnover Profit
Paris, France Brownfield Project, Perella Weingberg Alicante, in Spain
Source: unibail-rodamco.com 2. Klépierre The first european retail real estate company by revenue is Klépierre with € 609,2 million. This company has 3,9% share in French retail market.
Revenue and profit, 2011-2015 French retail property market share(%) (million €) 3.90% 800 706.9 600 609.2525.2500 600 511.6 508.9 533.5 400 357.2 400 365.2 384.3 300 384.9 200 200 100 1598 0 0 96.10% 2011 2012 2013 2014 2015 Turnover Profit
Monte Cristo Capital Paris, France BNP Paribas Project,Marseille, France
Source: klepierre.com; 3. Intu Properties This company has 4,06% share in England retail market.
Revenue and profit, 2010-2014 England property market share (%) (million €) 4.06% 600 500 480.0 500 427.9 431.0 448.0 400 400 397.0 371.4 364.0 300 300 277.0 264.0 363.0 200 200 100 100 2018 0 0 95.94% 2011 2012 2013 2014 2015 Turnover Profit
Puerto Venecia Poject, London, England Trafford Centre, In Spain With Canada Peel Group Pension Plan Invest.
Source: intugroup.co.uk 4. Deutsche Annington Immobilien Deutsche Annington Immonilien is the leading company in residential market in Europe. The company total assets 14.76 billion(€). In 2015 the company purchased Gagfah the third company in the rankings.
Revenue(million€) Market share (%) 0.91 2009 1033.6 10 1039.3 11 1062.8 12 1064.9 13 1067.6 2014 1156.6 3850 950.0 1000.0 1050.0 1100.0 1150.0 1200.0 99.1 Revenue Company Other
Bochum 184000 residential Dortmund, Berlin, Frank Average rent: Gegfah purchase unit furt, Essen 5.09- Modernization projects Gelsenkirchen, Bochum, 6.63(€/sqm/month) Acquisitions Property construction Munich, Herne, Duisburg , Bonn, Marl and 534 other cities citizens.
Source: deutsche-annington.com; 5. British Land The third european retail real estate company by revenue is British Land with € 329 million. This company has 3,35% share in England retail market.
Revenue and profit, 2011-2015 England property market share (%) (million €) 3.35% 500 400 384.0 400 329.0 329.0 284.0300 300 256.0 269.0 287.0 210.0 239.0 200 200 100 201.0 100 598 0 0 96.65% 2011 2012 2013 2014 2015 Turnover Profit
London, England New Mersey Shopping Paddington Central Park, in Speke
Source: britishland.com Real Estate industry by GFA (2010-2014) The the industry`s total usable floor area had a CAGR of 0.74% in the past 5 years. In 2014 it reached a value of 22,8 billion sqm.
European gross floor area from 2010 to 2014 (billion sqm) 23 22.8 22.8 22.6 22.4 22.25 22.24 22.2 21.98 22 21.8 21.6 21.538 21.4 21.2 21 20.8 2010 2011 2012 2013 2014
Source: energyagency.at Built-up areas in the European region The total Built-Up area in 2012 in the European region was 65.055 ksqm. Germany has the largest artificial built- up land cover, a 9.184 ksqm area, followed by France with 9.028 ksqm and Italy with 8.188 ksqm.
Land in use compared with total land (2012, %) Size of the total Artificial land 1.51% 3.05% in Europe was 195.972 ksqm Built-up whose composition is: Built-Up Artificial non Area 1.51% and Artificial non Built-up Total land Built-Up 3.05%.
95.44% 1. 2. 3. The number of the total Built-up areas in the European region has been constantly increasing from 2009 through 2012. Malta has the highest percentage of Built-up areas with 18.99%, Belgium has 7.12% and Netherlands 4.20%. <1000 1000-3000 >3000
Source: eurostat.eu Built-up surface (2009-2014) Germany has the biggest artificial built-up land covered, a 9.184 sqkm area, followed by France, Italy and the United Kingdom. Romania also had a quite large built-up area, 2.454 sqkm.
Total Built-up area in Europe and percentage growth (th. Built-up surface in the largest European Ksqm, 2009-2014) countries (th. Ksqm, 2012) 80 8 6.81 60 6.24 5.88 6 9.184 Germany 40 4 France 65.05 66.15 67.03 9.028 54.14 57.52 60.9 20 2 Italy 1.69 38.655 1.00 1.33 8.188 Romania 0 0 Other 24 2009 2010 2011 2012 2013 2014 2.454 Built/Up Area Growth
The European artificial land surface has experienced slowing growth from 2012 to 2014. According to the european LUCAS survey, the largest artifical and built-up area in 2012 was provided by Germany, France and Italy. Romania is in a good place with its quite extensive land and large built-up surface, 2.454 ksqm. Real estate construction and rent prices (2010-2014) The highest rental primes were those in Central London, amounting up to €1.603/sqm/year. However, Monaco was the most expensive country to construct a new building, with prices over €44.500/sqm.
Average Real Estate rent primes in the largest New building square metre prices in the most European cities and their growth rate (€, 2010-2014) expensive countries (Th. €, 2014) 400 6% 50 389.14 44.52 390 45 4.88% 4.77% 5% 40 380 371.41 366.45 4% 35 370 30 25.57 360 349.42 3% 25 347.56 350 Growth 20 2% 13.64 Rent Primes Rent 340 15 10.81 1.35% 10.02 330 1% 10 0.54% 5 320 0.00% 0% 1.54 0 2010 2011 2012 2013 2014 Monaco UK France Austria Switzerland Romania Contruction Growth
From 2010 to 2014, average rent primes in Europe’s largest cities were in a continuous increase, with a CAGR of 2.28%. The most expensive average rents in 2014 were in London, Zürich, Paris and Geneva. For building construction, Monaco was the most expensive country, where the price of one sqm was € 44 522. The cheapest were Macedonia with € 1.134 and Moldova with € 965.
Source: realestate.bnpparibas.com, globalpropertyguide.com, statista.com Real estate industry by sectors The real estate market in Europe amounted up to € 490.09 billion in 2014. The highest investment was in the offices sector with €161.73 billion which represented 33% of the real estate market.
The real estate industry by segments 2014 The real estate industry by segments 2014 (billion €) (%)
Offices Offices 127.42 Retail 26% 161.73 33% Retail Industrial Industrial Hospitality Hospitality 29.41 Residencial 6% Residencial 63.71 13% 107.82 22%
The real estate market amounted up to € 490.09 billion in 2014. The offices sector generated the highest revenue € 161.73 billion. The residential sector amounted up to € 127.42 billion,the retail sector to € 107.82 billion, the industrial to € 63.71 billion and the hospitality sector to € 29.41 billion.
Source: ec.europa.eu, realestate.bnpparibas.com, hospitalitynet.org; Residential sector by revenue (2010-2014) The residential investment volume represents 26% of the total real estate industry, and has a 21,6% profit margin. In the 2010-2014 period the CAGR was 2,45% for revenue and net profit as well.
Residential sector by revenue, 2010-2014 The real estate by segments, 2014 (bill €) (%) 130 127.42 128 126.46 126 124.92 124 Other 26% 122 sectors 120 118.25 118 Residencial 116 115.8 114 74% 112 110 108 2010 2011 2012 2013 2014
Similarly to the retail subsector, in case of the residential sector there was a continuous growing tendency between 2010 and 2014, 2013 having been the only year with a decrease, of 1.2%
Europeanrealestateforum.eu, epra.com, europe-re.com, jll.com Residential sector by profit (2010-2014) The residential investment volume represents 26% of the total real estate industry, and has a 21,6% profit margin. In the 2010-2014 period the CAGR was 2,45% for revenue and net profit as well.
Residential sector‟s profit and growth from 2010 to 2014 (billion €)
28.00 8% 27.31 27.52 27.50 7% 6.9% 26.98 27.00 6% 5% 26.50 4% 26.00 25.54 3% 25.50 25.01 2.1% 2.0% 2% 25.00 1% 24.50 0% 24.00 -1.2% -1% 23.50 -2% 2010 2011 2012 2013 2014 Profit Growth
Similarly to the retail subsector, in case of the residential sector there was a continuous growing tendency between 2010 and 2014, 2013 having been the only year with a decrease, of 1.2%
Europeanrealestateforum.eu, epra.com, europe-re.com, jll.com Residential sector by revenue- forecast (2016-2019) Just like in the case of the European real estate industry, there is a 9% five-year annual return forecast for the European residential subsector as well.
Residential Real estate forecast in Europe 2016-2019 (bill €) 250
200 193.44 177.46 162.81 149.37 150
100
50
0 2016 2017 2018 2019
The experts raised their forecast for the European residential real estate annual returns between 2015 and 2019 to 9% from 8.7%.
Source> Propertyfundsworld.com Top 5- residential market (2014) Largest european Residential property companies are based in Germany. Firsts is Deutsche Annington and Deutsche Wohnen, who was merged some big competitors in these years like GSW Immobilieren.
Top Real Estate Office sector companies by portfolio Top 5 companies headquarters value and net income in 2014 (billion EUR) 12.76 Deutsche Annington 10.5 Deutsche Wohnen 8.3 Gagfah Number of employees 5.67 (100 capita) LEG Immobilieren >8 2-5 2.75 5-8 <2 Gecina
0 2 4 6 8 10 12 14 16 18 20
All of the companies are listed in stock exchange and one of the biggest residential companies. Largest Residential company in 2014 is the Deutsche Annington with € 12.76 billion total portfolio value.
Source: scoperatings.com; deutsche-annington.com, gagfah.com, leg-wohnen.de, grandcityproperties.com Residential sector by GFA (2010-2014) It is estimated that there are 22,8 billion sqm of useful floor space in the EU27, 75% of this floor space is residential and 25% is non-residential. Annual growth rates in the residential sector are around 1%.
Gross floor area in Europe (bill sqm) Floor space distribution per region (%) 2014 17.10 14
2013 16.90
50 2012 16.71 36 2011 16.53
2010 16.35 Central&East South North&West
15.80 16.00 16.20 16.40 16.60 16.80 17.00 17.20
The most populated countries (DE, FR, UK, IT and ES) account for 65% of total floor space.
64% of the residential buildings are single family houses and 36% are apartment blocks.
Source> Insitutebe.com, energyagency.at, deloitte.com, Eurostat.com Office sector by revenue (2010-2014) The European office sector‟s revenue has been steadily increasing, on average it increased by 5% each year.
Revenue, 2010-2014 The real estate by segments 2014(%) (billion €)
200 174 180 160 158 160 147 150 Other 140 33% sectors 120 100 Office 80 60 67% 40 20 0 2010 2011 2012 2013 2014
As the biggest sector from European real estate, the office sector grew constantly, except in 2013.
Industrybrowser.com,ec.europa.eu, realestate.bnpparibas.com Office sector by profit (2010-2014) The office sector accounts for 33% of the retail industry; its profits have shown an overall growing tendency in the last years. Office sector profit 2010-2014 (Billion €)
28 27.4 27
26 25.2 24.9 25
24 23.7 23.2 23
22
21 2010 2011 2012 2013 2014
The European office sector has a net profit margin of 12,8%.
Source: ec.europa.eu, realestate.bnpparibas.com Office sector by revenue- forecast (2015-2019) The European office sector is growing, but at a slowing rate.
Forecast, 2015-2019 (%) 25%
20%
15% Core Europe UK 10% Central&East Europe
5% Periphery
0% 2015 2016 2017 2018 2019 -5%
By 2019 we expect the European market to start shrinking.
Deutscheawm.com Top 5- office market (2014) Office investments made up 48% of total investments in Commercial Real Estate. The list of largest European property companies with office departments include 2 from London, 2 from Paris.
Top real estate office sector companies by portfolio Top 5 companies and their headquarters value and net income in 2014 (billion €) 12.11 British Land 0.24 10.4 Fonciére des Regions 0.56 9.81 Land Securities Group 0.89Number of employees 6.48 (100 capita) Gecina 0.57 >8 2-5 5.86 Derwent London 0.49 5-8 <2
0 2 4 6 8 10 12 14 16 18 20
All of the above companies are listed on the stock exchange and are among the biggest property companies. British Land has the biggest office division: 48% of the total portfolio value, amounting up to € 12.11 billion and € 239 million profit.
Source: epra.com; forcieredesregion.fr; deutsche-wohnen.com; britishland.com; gecina.fr; landsecurities.com Office sector by GFA (2010-2014) After a long decline, the European office market started to grow again in 2014.
European offices (billion sqm)
2 1.47 1.39 1.40 1.41 1.39 1
1
1
1
1
0
0
0 2010 2011 2012 2013 2014
The improvement of economic conditions and labor market performance in 2014 aaihelped kick off the office market in 2014.
Source: BNP Paribas.com;JLL.com Retail sector by revenue (2010-2014) The retail investment volume represents 22% of the commercial real estate sector, and has a 32,6% profit margin. In the 2010-2014 period the CAGR was 2,47% for revenue and net profit as well.
Retail sector by revenue, 2010-2014 (billion €) The real estate by segments 2014(%) 110 107.81 108 107.01 106 105.7 22% 104 Other sectors 102 100.06 100 Office 97.98 98 96 78% 94 92 2010 2011 2012 2013 2014
The above charts show a continuous growth tendency in the 2010-2014 period, the sole decrease being recorded between 2012 and 2013.
Europeanrealestateforum.eu, epra.com, europe-re.com, jll.com Retail sector by profit (2010-2014) The retail investment volume represents 22% of the commercial real estate sector, and has a 32,6% profit margin. In the 2010-2014 period the CAGR was 2,47% for revenue and net profit as well.
Retail sector‟s profit and growth from 2010 to 2014 (billion €)
36 8% 7.0% 35.15 7% 35 34.88 34.46 6% 5% 34 4% 33 3% 32.61 2.0% 31.94 2.1% 2% 32 1% 0% 31 -1.2% -1% 30 -2% 2010 2011 2012 2013 2014
The above charts show a continuous growth tendency in the 2010-2014 period, the sole decrease being recorded between 2012 and 2013. Retail sector by revenue- forecast (2015-2019) The retail sector will grow constantly in the next 5 years, by a CAGR of 2.5%. The growth is due to the Eurozone GDP growth. The revenue will be over € 121 billion.
Retail forecast 2015-2019(billion €) 125.00 121.99
120.00 119.01 116.11 115.00 113.28 110.52 110.00 107.82
105.00
100.00 2014 2015 2016 2017 2018 2019
The retail sector will grow constantly between 2015-2019. The CAGR in this period is 2.5% and the revenue in 2019 will be over € 121 billion. The growth reason is the Eurozone GDP growth and especially the growth in the most important countries like the UK, Germany and France.
Source: realestate.bnpparibas.com, ey.com, retailresearch.org; Top 5- retail sector (2014) The top European retail real estate companies have a total market share of € 1,6 billion. The first and second company have 8,1% in the French market, and the other tree have 10,8% in British market.
Top real estate office sector companies by portfolio TOP 5 retail real estate companies headquarters value and net income in 2014 (billion €) 35.7 Unibail Rodamco 1.67
21 Klépierre 0.64
12.9 Intu Properties 0.82 Number of employees (1000 capita) 12.11 <1 British Land 0.24 1-2 7.6 >2 Hammerson 0.95
0.0 10.0 20.0 30.0 40.0
Unibail Rodamco is the biggest European real estate company in retail sector, and the third biggest in the world. Unibail- Rodamco is the market leader by portfolio value and net income, although Intu Properties and British Land have more employee.
Source: Annual reports Retail sector by GFA (2010-2014) In 2010 and 2011 there were about the same number of square meters in retail real estate in Europe. Then it started to decline in 2014, going against the global trend. European retail (billion sqm) 1.4 1.21 1.19 1.2 1.04 1.07 0.98 1
0.8
0.6
0.4
0.2
0 2010 2011 2012 2013 2014
• The retail are was largest in 2010 and 2011 in Europe, about 1,2 billion sqm. • Between 2010-2014 Europe had a hard time, while the global retail’s GFA constantly grew, in Europe it was shrinking.
Source: BNP Paribas.com;JLL.com Industrial sector by revenue (2010-2014) In 2014 the industrial sector‟s revenue was € 63.71 billion the highest of the last 5 years. The industrial sector accounted for 13% of the real estate market in 2014. The revenue grew constantly except 2012-2013.
Industrial sector revenue 2010-2014 (billion €) The industrial sector market share 2014(%) 65 8% 63.71 64 63.23 7% 13% 63 6.9% 62.46 6% 62 5% 61 4% Other real estate 60 59.13 3% sectors 59 57.90 2% Industrial sector 58 2.1% 2.00% 57 1% 56 0% 55 -1% 87% 54 -1.2% -2% 2010 2011 2012 2013 2014
The industrial segment revenue grew constantly except between 2012-2013. The revenue was € 63.71 billion in 2014. The revenue grew by 2% between 2013-2014. The industrial segment’s share was 13% of the total market in 2014.
Source: ec.europa.eu, realestate.bnpparibas.com, hospitalitynet.org; Industrial sector by profit (2010-2014) The industrial real estate profit grew every year except 2012-2013. The highest value was in 2014, € 22.68 billion. The average net profit margin was 35.6%.
The industrial sector‟s profit 2010-2014 (billion €)
23 22.68 8% 22.51 7% 23 6.9% 22.24 6% 22 5% 22 4% 21.05 3% 21 20.61 2% 2.1% 1.98% 21 1% 0% 20 -1%
20 -1.2% -2% 2010 2011 2012 2013 2014
The industrial real estate’s profit grew every year except 2012-2013. The highest value was in 2014, € 22.68 billion. The average net profit margin is 35,6%.
Source: ec.europa.eu, realestate.bnpparibas.com, hospitalitynet.org; bizz.yahoo.com; Industrial sector by revenue – forecast (2015-2019) The industrial segment will grow constantly between 2015-2020. The CAGR is 3.17% in this period. The revenue will be over € 76 billion in 2020.
Industrial segment forecast revenue 2015-2020 (billion €) 90 5.0% 76.804.7% 80 73.35 4.5% 70.46 4.1% 70 63.71 65.43 66.80 68.34 4.0% 60 3.5% 3.0% 50 3.1% 2.5% 40 2.7% 2.0% 2.1% 2.3% 30 1.5% 20 1.0% 10 0.5% 0 0.0% 2014 2015 2016 2017 2018 2019 2020
The industrial sector will grow constantly between 2015-2020. The CAGR in this period will be 3.17% and the revenue in 2020 will be over € 76 billion.
Source: buildingradar.com; Top 5- industrial sector (2014) Industrial sector investments made up 11% of total investments in the real estate‟s commercial sector. The largest Europe-based Industrial property company was Segro, with € 6.11 billion portfolio value.
Top Real Estate Industrial sector companies by portolio Top 5 companies headquarters value and net income in 2014 (billion €) 6.11 SEGRO 2.07 Hansteen Holdings 1.57 Warehouses de Pauw Number of employees 1.18 (100 capita) Castellum >8 2-5 0.79 Tritax Big Box 5-8 <2
0 2 4 6 8 10
All of the companies are listed on the stock exchange and are among the biggest property companies. The largest industrial company is SEGRO, its portfolio value being € 6.11 billion and making a € 362 million net profit.
Source: epra.com, segro.com, castellum.se Industrial sector by GFA Overall the industrial space take-up increased from 2010 to 2014, with a slight drop in 2013
Industrial spaces take-up (billion sqm) 1 0.79 1 0.75 0.75 0.69 0.70 1
1
1
0
0
0
0
0 2010 2011 2012 2013 2014
The international investors showed a strong interest towards the European industrial market with almost € 1 billion of the inflows in Europe coming from them
Source:dtz.dk Hospitality sector by revenue (2010-2014) The hospitality investment volume represents 6% of the total real estate industry. The revenue of the hospitality sector is growing, and it reached € 29,41 billion in 2014.
Revenue of the hospitality sector Hospitality sector‟s market size, 2014 (%) 2010-2014(billion €) 33 29,41 32 6% 31 30 29.19 29 28.82 28 27.29 26.72 27 94% 26 25 24 Other Hospitality 2010 2011 2012 2013 2014
• In the 2010-2014 period the CAGR was 0,87% for revenues and net profits as well.
Source:compensationforce.com Hospitality sector by profit (2010-2014) European hospitality transaction volume totaled €11,4 billion in 2014. This figure represents a new record since the onset of the global financial crisis and marks a continuation of the market recovery seen in 2013.
Total profit of the hospitality sector 2010-2014(billion €) 12 11,4 10.46 10.16 10 8.89 8.38 8
6
4
2
0 2010 2011 2012 2013 2014
• The profit in the hospitality sector show € 3,02 billon growth from 2010 to 2014.
Source: hospitalitynet.org Hospitality sector by revenue- forecast (2016-2019) Due to the forecast increase in demand, the sector is going through capacity expansion as well as increasing investment into infrastructure.
Revenue forecast 2016-2019(billion €) 39 38.01 38 37.56 37 36.12 36 35 34 33.07 33 32 31 30 2016 2017 2018 2019
• Positive growth trends are also reflected across occupancy levels, revenue and EBITDA margins. • This sector is going to grow by 4,66% CAGR.
Source: propertyfundsworld.com; avivainvestors.com; jll.com; europa.eu; colliers.com Top 5- hospitality sector (2014) The five largest hospitality companies in Europe have a total profit of 1,67 billion Euro.
TOP 5 hospitality companies headquarters Top hospitality real estate companies by turnover and income in 2015 (billion €) 5.5 Accor hotels 0.22
3.3 Whitbread 0.43
1.5 Louvre hotels group 0.1 Number of employees (1000 capita) 1.06 Inter continental <40 0.5 hotels group 40-100 1.3 100-200 NH Hotel Group
0.0 2.0 4.0 6.0 8.0 10.0
The Accor hotels are the market leader in terms of € 5,5 billion in turnover and € 0,22 billion in income. The runner-up is the Accor hotels with 180 000 employees.
Source : statista.com ; reuters.com ;investopedia.com; accorhotels-group.com; marketwatch.com ; louvrehotels.com; ehitbread.co ; nasdaq.com Hospitality sector by GFA (2010-2014) In 2013 this sector‟s GFA fell by 17,39% compared to 2012 then it recovered.
Square meters 2010-2014 (billion sqm) 0.8 0.69 0.68 0.69 0.72 0.7 0.57 0.6 0.5 0.4 0.3 0.2 0.1 0 2010 2011 2012 2013 2014
• The European hospitality sector recovered after an abrupt fall. • In the hospitality sector the square meters show 0,03 billion sqm growth from 2010 to 2014.
Source: epra.com ; newsec.lt ; realestate.bnpparibas European RE market summary
2010-2014 2015-2019 Outstanding markets
Prosperous markets 2,46% 9%
RE Revenue Emerging countries/cities
Total Total (Dublin, Madrid, Barcelona, Hamburg)
Profit 7,65%
Revenue Profit GFA Top companies Headquarters Portfolio Value 4,97% Deutsche Annington 5,27% Germany € 12,76 bill 6,5% Residential Immobilien 9% 26% 22% 33% 8,26% Office British Land UK € 12,11 bill 29% 6% Retail Unibail Rodamco France € 35,7 bill 22% 75% 13% Industrial Segro UK € 6,11 bill RE Subsectors RE 22% 18% Hospitality Accor UK € 5,5 bill Agenda
[Global] [Europe] [Romania]
Economical overview
Construction Construction industry industry
Real Estate Real Estate
industry industry
[
Cluj
Napoca ] Economy overview - Romania (2010-2014) The romanian GDP has grown steadly in the past years, along with the contribution of real estate industry, which amounted 9% of GDP in 2014, while the impact of the construction industry has decreased.
Construction & Real estate industries contribution to GDP TOP 5 counties by GDP/capita (€ 1000) – 2014 2010-2014 (%) 120%
9.7 100%
9.5 80%
60% 9.7 9.3
40%
10.3 20% 7.8% 7.1% 6.4% 6.2% 6.0% 8.5% 8.0% 8.0% 9.0% 9.0% 19.7 0% 2010 2011 2012 2013 2014 The real estate industry in the past years was a fast Real Estate Construction GDP growing industry in Romania. It’s contribution to GDP reached 9% in 2014, while the construction industry’s contribution dropped to an all time minimum, with 6%. Source: insse.ro Population – Romania (2010-2015) There is a noticeable depopulation tendency in Romania, which, together with a strong urbanization process, keeps the stable residents of the major cities relatively constant.
The population of Romania (2010-2015, 1000 capita)
20400 0% 20,294 20300 -1% 20,199 -1% 20200 20,095 -2% 20100 20,020 -2% 20000 19,947 -3% 19900 19,861 -3% -4% 19800 -4% 19700 -5% 19600 -5% 2010 2011 2012 2013 2014 2015 Population Growth
The sudden decrease in 2011 can be explained by the official census conducted that year. On a year-by year basis, we only have estimations. Also the number of stable residents is hard to estimate because of the national migration process.
Source: insse.ro, scribd.com, hotnews.ro, mediafax.ro, worldpopulationreview.com, populationpyramid.net, criticatac.ro, gandul.info, indexmundi.com Top 10 cities by population (2015) There is no apparent change in the population of the major cities over the last 5 years due to the two simultaneous migration processes: depopulation and urbanization.
Population of Top10 cities (2015, 1000 capita)
Brăila 214
Ploiești 229 Iași Brașov 276 Cluj-Napoca Galați 294
Constanța 303 Craiova 304 Timișoara Brașov Galați Timișoara 315 Brăila Cluj-Napoca 317 Ploiești Iași 318 București Craiova Constanța București 1877
0 500 1000 1500 2000
2015
Source: insse.ro, scribd.com, hotnews.ro, mediafax.ro, worldpopulationreview.com, populationpyramid.net, criticatac.ro, gandul.info, indexmundi.com Top 10 cities by populatin (2015) Despite the fact that many counties suffered an over 15% decrease in population, in the big cities the number of stable residents remains the same. Population of Romania‟s Top 10 counties (2002 -2012, 1000 capita)
Brăila 304 -11.43% Bihor 549 -8.52% Prahova 735 -6.17% Galați 507 Brașov 505 -18.10% Dolj 618 -4.04% -14.18% Constanța 630 Iași 723 -18.29% -11.13% Timișoara 650 Cluj 659 -12.89% București 1677 -11.81% -15.78% 0 500 1000 1500 2000 2500
2012 2002 In the big cities of Romania the number of stable residents remains the same. This can be explained with the phenomenon of urbanization and depopulation happening at once. The number of Romanians living abroad adds up to a staggering amount of more than 3 million, concentrated in Spain, Italy, and UK.
Source: insse.ro, scribd.com, hotnews.ro, mediafax.ro, worldpopulationreview.com, populationpyramid.net, criticatac.ro, gandul.info, indexmundi.com, economica.net TOP 10 cities by industry (2015) After the fall of communism most of the Romanian industry was privatized, which consequently led to the bankruptcy of many factories.
Oradea Iași Cluj-Napoca
Textile Construction Timișoara Brașov Galați Automotive Petrol & Gas Brăila ICT Agriculture Ploiești Metal Naval
Craiova Constanța Chemical Food
Energy Extraction
Bucharest is not mentioned, because the capital is characterized by a mixture of several industries. Many companies bring their official business to the capital, but their activity is actually happening elsewhere. Source: cotidianul.ro, adrbi.ro, zf.ro, primariatm.ro, prefecturaiasi.ro, digi24.ro, brasovcity.ro, adrcentru.ro, viata-libera.ro, cciph.ro, Oradea.ro, cjbraila.ro Top counties by medium salary (2015) Bucharest had the highest average monthly wage in 2015, €596. The capital is followed by Ilfov with €501 , Cluj with €458, Sibiu with €442 and Timiş with €440.
Romanian counties distribution by medium TOP 5 counties by medium salary in salary, 2015 (€) Romania, 2015 (€) 520 501 500
480 CJ 458 460 442 440 440 SB TM BV 420 420 >€400 400 €370-400 IF €340-370 380 (B) €321-340 360 <€321 Ilfov Cluj Sibiu Timis Brasov
Bucharest had the highest average monthly wage in Romania in 2015, €596. Six Romanian counties have the average monthly wage over €400. Vrancea and Vaslui have the lowest wages on a national level, with €305 and €301 respectively.
Source: jurnalul.ro, oanda.com; 1. Bucharest Bucharest and the county of Ilfov have had the highest GDP/capita in Romania in the last 4 years. These counties are the only ones with GDP/capita over € 10 000. Their top industries: real estate, manufacturing and commerce.
GDP/capita evolution (2011-2014, €) 25000
19711 20000 16660 15454 15000 14360 12012 11238 10724 10000 8388 • Real estate • Manufacturing
5000 • Commerce
0 Ilfov 2011 2012 2013 2014 Bucharest
Bucharest’s GDP/Capita has undergone constant growth, reaching € 19 711 in 2014, the highest in Romania. Bucharest is followed by Ilfov county with € 10 724 in GDP/Capita. Its main industries: real estate, manufacturing and commerce
Source: old.econtext.ro, analizeeconomice.ro, forbes.ro , monitolcj.ro, oanda.com; 2. Cluj Cluj county‟s GDP/capita grew constantly between 2011 and 2014. In 2014 the GDP/capita was €9.460, the 4th highest in Romania. Its main industries: IT, automotive and production.
GDP/capita evolution (2011-2014, €) 10000 9460 16.00% 8222 7638 14.00% 8000 7429 15.1% 12.00% 6000 10.00% • IT 8.00% • Car 4000 7.6% 6.00% 4.00% • Production 2000 2.8% 2.00% 0 0.00% 2011 2012 2013 2014
Cluj GDP/Capita has grown constantly and in 2014 it reached €9.460, the 4th highest value in Romania. Between 2013-2014 the growth was 15,1%, mainly driven by the dynamic IT industry.
Source: old.econtext.ro, analizeeconomice.ro, forbes.ro , monitolcj.ro, oanda.com; 3. Timiş Timiş‟s GDP/capita in 2014 was €9.764, the 3rd highest in Romania. Its main industries: IT, automotive, electronics and petrochemicals. Acording to Forbes, Timişoara was the county with the biggest business potential in 2015.
GDP/capita evolution (2011-2014, €)
12000 9768 10507 25.00% 10000 22.6% 9764 20.00% 7965 15.00% 8000 10.00% • IT 6000 • Automotive 7.6% 5.00% 4000 0.00% • Petrochemicals 2000 -5.00% • Electronics
0 -7.1% -10.00% 2011 2012 2013 2014
Timiş GDP/Capita in 2014 was €9.764, the 3rd highest value in Romania. Its main industries: IT, automotive, petrochemicals and electronics. The IT industry has had a dynamic and fast growth. According to Forbes, Timişoara was the county with the biggest business potential in 2015.
Source: old.econtext.ro, analizeeconomice.ro, forbes.ro, oanda.com; 4. Sibiu Sibiu‟s GDP/capita in 2014 was €7.893. Its main industries: automotive parts, electronics and machinery. The GDP/capita decreased due to the fact that the Piteşt-Sibiu highway was not finished.
GDP/capita evolution (2011-2014, €) 8200 8011 8.00% 8000 7.5% 7893 7800 5.8% 6.00% 7600 7454 • Automotive parts 7400 4.00% 7200 • Electronics 7044 2.00% 7000 • Machinery 6800 0.00% 6600 6400 -1.5% -2.00% 2011 2012 2013 2014
Sibiu‟s GDP/capita in 2014 reached €7.893. Its main industries: automotive parts, electronics and machinery. The GDP/capita decreased due to the delays in the construction of the Piteşt-Sibiu highway.
Source: old.econtext.ro, analizeeconomice.ro, forbes.ro, oanda.com; 5. Brasov Braşov‟s GDP/capita in 2014 was €9.313, the 5th highest in Romania. Its main industries: real estate, services and manufacturing. The annual growth speed is twice the national average.
GDP/capita evolution (2011-2014, €) 10000 8681 9313 8.00% 8077 7618 7.3% 7.00% 8000 7.5% 6.00% 6.0% 6000 5.00% 4.00% • Real estate 4000 3.00% • Services 2.00% 2000 • Manufacturing 1.00% 0 0.00% 2011 2012 2013 2014
Braşov‟s GDP/capita grew constantly between 2011 and 2014, in 2014 reaching €9.313, the 5th highest value in Romania. Its main industries: real estate, services and manufacturing. Braşov’s GDP/capita grew constantly, by over 5% between 2011 and 2014. The growth speed is twice the national average.
Source: old.econtext.ro, analizeeconomice.ro, forbes.ro, oanda.com; Earnings from taxes – Romania (2014) The NAFA earnings are constantly growing year by year. In the first 9 months of 2015 is already a 7.8% growth compared to the first 9 months of 2014. Despite the reduction in the TVA for the foods, the earnings increased from this tax by 12,5%. National Agency for Fiscal Administration earnings Distribution of the major taxes in 2014 and growth from 2009 to 2014 (billion RON) 200 0.14 180 1.00% TVA 183 0.12 10% 160 168 174 140 158 0.1 Income tax 10.00% 120 141 41.00% 134 0.08 excise 100 80 0.06 profit tax 60 0.04 19.00% Customs duty 40 0.02 20 Other sources 0 0 19% 2009 2010 2011 2012 2013 2014 Earnings Growth
Between 2009 and 2014 the National Agency for Fiscal The Value Added Tax generates the 41% of the Administration has registered an average of 6.44% growth earnings for the NAFA. The value of the VAT in in their earnings year by year. 2014 was 75,03 billion RON.
Source: anaf.ro; amosnews.ro; fiscalitatea.ro; capital.ro; myaccountant.eu Taxes & minimal wage – Romania (2010-2014) The MW (minimal wage) is constantly growing with a yearly average of 11,88%. A major change was introduced in 2014 by adding a 1.5% tax in constructions. This tax decreased over the years, and in 2016 will be totally removed. From 2016 the TVA will decrease from 24% to 20% and in 2017 to 19%.
2010-11 2012-13 2014 2015 2016-17
• 19%->24% TVA • 2010-600 Ron MW • 2012-700 Ron MW • 2011-670 Ron MW • 2013, • Possibility of 50% Jan-Jun: 750 Ron MW• Jan: Building tax: 1,5% Jan-Jul: 975 Ron discount for penalties • 2013, • Jan-Jul: 850 Ron MW • • 24%->20% TVA Jul-Dec: 800 Ron MW • Jul-Dec: 900 Ron MW MW • Jul->: 1050 Ron MW • 16%->5% dividend tax • Building Tax: 1% • Jul-Dec: 800 Ron MW • Jun: 24%->9% TVA • Growth in the limit of for foods max. sales for a micro- enterprise from €65 to €100 thousand. • Removal of the building tax Source: legestart.ro; codfiscal.net; avocatnet.ro; mediafax.ro; mfinante.ro Minimal wage & VAT (2010-2015) The minimal wage is constantly growing from 2010 year by year. Since 2013 there is a grow in every half year until 2015. In 6 years the minimal wage increased from 600 RON to 1050 RON.
The evolution of the minimal wage between 2010 and 2015 (RON) The evolution of the VAT between 2010 and 2017 1200 14.0% 30% 6% 5% 12.0% 25% 1000 1050 4% 975 10.0% 24% 24% 24% 24% 24% 24% 3% 900 20% 800 850 2% 800 20% 750 8.0% 19% 1% 600 670 700 15% 600 6.0% 0% 400 10% -1% 4.0% -2% 200 2.0% 5% -3% -4% 0 0.0% 0% -5% 2010 2011 2012 2013-H1 2013-H2 2014-H1 2014-H2 2015-H1 2015-H2 2010 2011 2012 2013 2014 2015 2016 2017 VAT Growth Earnings Growth
The VAT was extended to 24% from The minimal wage was increasing averagely 7% a year from 19% in 2010. After 6 years it will 2010 to 2015. decrease to 20% and then to 19%.
Source: legestart.ro; codfiscal.net; avocatnet.ro; mediafax.ro; mfinante.ro Local Tax - Romania (2015) The local tax for firms are determined by the cities, in a range between 0,25% and 1,5%, meanwhile the individuals have a fixed tax, 0,1%.
The local tax in the biggest cities for firms (2015)
1,5% Bucharest The cities can determine the local tax
1,5% Braşov between 0,25%-1,5%. The highest local tax in 2015 is in the capital and Braşov. 1% Cluj-Napoca
0,95% Iaşi
0,9% Timiş
Source: anaf.ro; amosnews.ro; fiscalitatea.ro; capital.ro; myaccountant.eu Local taxes – Romania (2015) After 25 years, in 2016 the local taxes will be defined by the intended use of the building, and not by the ownership status. The buildings without revaluation in the past 5 years will be taxed by 2% of the statistical value of the construction.
The change in defining the local taxes between 2015 and 2016, in Romania 2015, by ownership status 2016, by intended use of the building
Individuals Firms Residence Business
0,1% 0,25%-1,5% 0,08%-0,2% 0,2%-1,3%
Source: avocatnet.ro Prima Casa (2015-2016) In 2015, the state determined 584 million € as the maximum for guarantees. From 2016, they want to lower the coverage level to a maximum of 337 million €. Also from 2016 everybody can only use Prima Casa‟s credit only once.
2015, ROBOR+2,5% 2016, ROBOR+2%
State contribution Prima Casa State contribution Prima Casa
€584 50% guarantee 31,460 €337 50% guarantee 16,850 million Average credit: credits million Average credit: credits €40,000 €40,000
Since 2009 July, the start of the program, there were given 157.000 credits with a total of €2.88 billion of guarantee from the state.
Source: psnews.ro; economica.net Cadaster (Terrier, Land Registration) A cadaster is a comprehensive register of the real estate which commonly includes details of the ownership, the tenure, the precise location, the dimensions and the value of individual parcels of land.
What documents are required for Headline indicating the number and registration in cadaster? the name of the locality where the Demand for matriculation property is situated. Cadastral documentation drawn by Part I or Wealth Sheet as a reference on a ANCPI-authorized person describing the real estate The Authentic Act by which Part II or Property Sheet: the reference constituted or was transmitted the document which the ownership right is based ownership on Tax certificate Part III or Charges Sheet: guarantee rights and tasks Proof of payment of the registration fee
According to Minister of Regional Development, in the next 8 years the cadastral process will be costless. The main reason is to register every single field and property in the system until 2023.
Source: imobiliare.mervani.ro, legestart.ro, dreptonline.ro, cadastru-cluj.ro Co-ownership right Ownership between two or more person, simultaneously, whose property is divided in fund shares, without the asset to be split in its materiality. Every owner has a share in form of nominal fraction, decimal fraction or percentage. Two type of ownership right
Ordinary ownership Forced co-ownership
- if these goods are divided, usually become - may result from a legacy unfit for the use they have been made. - usual sources are: Forced co-ownership cases: 1. Acquisition contract of a property by two or 1. co-ownership partitions between two more persons buildings (wall, moat, fence) 2. Fund shares as a result of termination or 2. co-ownership of the common parts of dissolution of marriage buildings (with two or more apartments) 3. Construction in common with different owners 4. etc 3. co-ownership of good considered by family (family pictures, family papers, ect)
The main difference between them is that the first kind of co-ownership can be determinated by parting or separation.
Source: euroavocatura.ro, juridice.ro, avocatconsultantajuridica.ro Lease rights If the duration in not determined, the contract is valid: for 1 year in case of unfurnished real estate or for a unit of time corresponding to calculated rent (furnished real estate). The maximum duration of lease is 49 years even if the parties stipulate a longer duration, this period it is reduced to 49 years.
Lessor’s rights according to contract:
1. May proceed to immediate eviction of the other party if the lessee does not respect his/her obligations under the present contract.
2. In case of lessee’s eviction, the lessor has the right to retain the goods found in actual real estate until the calculated obligations (the rent) will be paid.
3. All arrangement approved by the lessor pass into his property his/her property, deducting the value of these facilities from the rent.
Source: euroavocatura.ro, legalis.ro, legestart.ro, ucecom.ro, efin.ro, mdrl.ro Property rights Except some special cases provided by law, the ownership of the property is acquired by registration in the cadaster (land register).
The owner enjoys goods that belongs to Object of property right: the property itself him/her but within the limits prescribed by (Categorised by function, by physical form, etc) law: • Right of tenure • Right to use Subject of poperty right: • Right of disposal individuals, families, social groups and • Right of “uzufruct”: the owner’s right to organizations acquire and use the “fruit” of a good, the income of a inheritance, a loan interest, etc Two big categories: private property and public property
Source: legestart.ro, legeaz.net, drept.ugal.ro Agenda
[Global] [Europe] [Romania]
Economical overview
Construction Construction Construction industry industry industry
Real Estate Real Estate
industry industry
[
Cluj
Napoca ] Construction industry overview – Romania (2014) The romanian GDP was influenced by the following industries.
Romanian industries distribution by revenue in 2014 The size of the construction industry in 2014, (€ billion) (€ billion)
9
9 14 5.6 Construction 27.7 GDP Romania
139
80.3
The construction industry made up 6,3% of the Romanian GDP in 2014. Revenue
Other Industry ICT Real Estate Construction
Source: cursdeguvernare.ro, arenaconstruct.ro Construction industry by revenue (2009-2014) The overall evolution of the construction industry in Romania has seen a decline starting from 2009 and has maintained a strong stagnancy in recent years. However in 2014 it dropped to under 9 billion.
The construction industry‟s revenue and growth from 2009 to 2014 (€ billion) 14 2% 0% 12 11.7 -2% 10 -4% 9.7 9.33 9.36 8 9.3 8.9 -6% -8% 6 -10% 4 -12% -14% 2 -16% 0 -18% 2009 2010 2011 2012 2013 2014 Revenue Growth The industry’s stagnancy is due to the lack of a strong political investment program, which would have corrected the declining profit in 2014. Also the growing lack of foreign funding is coupled with the inability of authorities to promote the building projects in the public and private sectors. Since the influencing factors have risen in 2013 the industry’s revenue dropped to an all time minimum, by 5% compared with the previous year.
Source: constructiv.ro, zf.ro, araco.org, mediafax.ro, wall-street.ro, dailybusiness.ro, interbizgroup.ro, business24.ro Construction industry by profit (2009-2014) The construction industry in Romania has seen a decline starting from 2010 and has maintained a strong stagnancy in recent years. However in 2013 it rose 57% compared to the previous year.
The construction industry‟s profit and growth from 2010 to 2014 (€ billion)
2 70% 1.8 60% 1.8 1.6 1.69 50% 1.4 40% 1.2 1.38 1.29 30% 1 1.14 20% 0.8 10% 0.6 0.4 0% 0.2 -10% 0 -20% 2010 2011 2012 2013 2014 Profit Growth The industry’s stagnancy is due to the lack of a strong political investment program, which would have corrected the declining profit in 2014. Also the growing lack of foreign funding is coupled with the inability of authorities to promote the building projects in public and private sector, which led to the sudden drop of 6,1% compared to previous year in 2014.
Source: constructiv.ro, zf.ro, araco.org, mediafax.ro, wall-street.ro, dailybusiness.ro, interbizgroup.ro, capital.ro Construction industry by employment (2010-2014) These numbers show us evolution of the number of the employees from 2010 to 2014 and release the information about witch year brought the change from falling to increasing.
Employment changes in the romanian construction industry, 2010-2014 (1000 capita, %) 360 8%
355 356 6% 350 4% 345 346 345 2% 340 0% 335 337 334 -2% 330
325 -4%
320 -6% 2010 2011 2012 2013 2014 Employment Growth
Since 2010 the number of the employees was significantly falling mainly because of the global crisis but in the year of 2011 the industry started to recover . In 2013 we can see a small falling part again with 1.23% but from 2014 until now the industry start to grow again. In general in these 5 years the overall fall of the number of employees was -2.29% but it’s rising for the moment.
Source: insse.ro Construction industry by employment (2010-2014) The Romanian construction sector is heavily concentrated, the vast majority of construction workers working in the capital. However, in the past years the number of employees in Bucharest has decreased by 10,4%. Construction industry employee number changes (%) TOP 6 counties by number of employees in 2010 to 2014 construction industry (2014, 1000 capita) 16 15.2 14.01 14 12.6 12 11.47 10.5 10.4 10 7,9% 8 6 9,5% 4 -4,2% 25,4% -8,3% 2 0 1,9% Constanta Cluj Timis Brasov Prahova Galati
7.500-1.0000 -3,1% In the 2010-2014 period, Bucharest had the biggest employee pool in the industry, around 80.000 10.000-15.000 79.700 people. During this period, Hunedoara county has -10,6% >15.000 experinced the biggest boom, because the counties employee number has increased by 25,4%.
Source: Insse.ro Construction industry by revenue – forecast (2015-2020) The annual expected average growth rate of construction industry is 3,4% for the 2015 - 2020 period.
Romanian construction industry revenue forecast from 2015 to 2020 (€ billion) 16 14 12
€ 10 8
Billion 6 4 2 0 2015 2016 2017 2018 2019 2020 Optimist plan 1.5 1.9 2 2 2.1 2.1 Realist plan 0.6 0.7 0.8 0.9 0.9 1 Pessimist plan 9.1 9.5 10 10.3 10.5 10.6
From 2015 the government has budgeted 20% more funding than the amount consumed in 2014 for Prima Casa support warranties, for this reason the market of construction industry and the market of „old buildings” is growing. From 2017 forecasters expect a slow increase and from 2019 the market will start growing.
Source: interbizgroup.ro infrastructure-insight.com europaproperty.com Construction industry by revenue – forecast (2015-2020) Investment in infrastructure, red-tape cuts and coming wage increases may be efficient in attracting and retaining foreign investors.
The plan of financing distribution of investment in Forecast for average gross monthly salary infrastructure until 2020 (€100) and unemployment rate
European Commission (EC) Romanian government 9 Loans from the EIB and the EBRD 8 7 6.9 6.8 6.7 6.6 6.5 6.5 6 Average monthly 25% 5 salary 4 3 Unemployment rate 60% 15% 2 1 0 2015 2016 2017 2018 2019 2020
In 2015 the government outlined a strategy for the The decrease in unemployment rate and increase in construction of motorways from 2015 up to 2030 purchasing power will increase the demand for (Transport Masterplan of Romania). constructions. The stabilization of the exchange rate is also a favorable factor.
EIB - European Investment Bank EBRD - Eueopean Bank for Reconstruction and Development
Source: reports.pr-inside.com europaproperty.com interbizgroup.ro statista.com cnp.ro Residential sector by revenue (2010-2014) Romanian residential constructions started picking up pace after the economic crisis, however the revenues have not grown significantly. Residential market revenue 2010-2014 Distribution of residential projects by type (€ billion) 40 6 15% 30 5,55 10% onyear) 20
5 - 4,97 5,03 4,92 5% 10 4 4,43 0% 0 3 -5% -10 -10% -20
2 (yeargrowth Real -30 -15% 2010 2011 2012 2013 2014 1 -20% New -14.3 -21.3 11 -7 6.6 0 -25% Renovation -16.2 5.4 -1.2 28 2.2 2010 2011 2012 2013 2014 Total -14 -18.9 9.6 -3.3 6 Value of residential construction Growth The larger activity in the residential sector was renovation. This make sense, since the 65% of the homes in Romania are older than 35 years. The Ministry estimated that 2,4 million apartments did not have proper thermal insulation. Most of the Romanian houses need to be renovated, the Ministry of Regional Development estimated that this market will grow by 1,5€ billion yearly.
Source: buildecon.com Office sector by revenue (2010-2014) The office construction activity went through a revitalization period in 2013, after several years of strong decline.
Office market revenue 2010-2014 Distribution of projects in the non-residential (€ billion) constructions sector 2 10% 20 2 1,83 5% 10
2 1,77 1,71 onyear) - 0 1 1,57 0% 1,46 -10 1 -5% 1 -20 1 -10% -30 1 -15% Real growth (yeargrowth Real -40 0 2010 2011 2012 2013 2014 -20% 0 New -13.6 14 -22 6.9 6.6 0 -25% Renovation -31.2 16.9 -11 14.6 2.8 2010 2011 2012 2013 2014 Total -16.6 14.4 -20.7 8.1 6 Value of office construction Growth
The office space in Bucharest grew from 120.000 m² in 2013 to 132.000 m² in 2014. The slow growth is the result of the companies maximizing the usage of the office space. The office buildings should be renovated in every 3-5 years, so the revenue of the renovation will exceed the new constructions.
Source: buildecon.com ensight.ro Retail sector by revenue (2010-2014) The retail went through a decrease in this period, several big shopping centers having been finished in the previous years.
Retail and wholesale market revenue 2010-2014 (€ million)
1 20%
1 550 10% 470 0% 0 -10% 0 280 -20% 270 260 0 -30%
0 -40%
0 -50% 2010 2011 2012 2013 2014 Value of retail and wholesale construction Growth
This segment of the construction industry saw a negative evolution. Few large scale projects were undertaken in 2014, the major retail centers had been finished in the previous period. In 2014 only two units were under construction: the Vulcan Value Center in Bucharest and the Targu Jiu Shopping City in Targu Jiu.
Source: buildecon.com Industrial sector by revenue (2010-2014) The dynamic growth of the industrial construction sector, by 10-15% in average, is attributed to heavy investment into factory development.
Industrial construction market‟s revenue 2010-2014 (€ billion) 2 70% 60% 1 50% 1,36 1 1,3 40% 1 1,13 30% 1,02 20% 1 0,83 10% 1 0% 0 -10% -20% 0 -30% 0 -40% 2010 2011 2012 2013 2014 Value of industrial construction Growth The industrial construction’s growth was very stabel. The main reason of this increase is the investors’ positive view of Romania. Due to this, several new factories have been built in the Central and North-Western Region, like the Ruck factory in Tarnavei, the Trelleborg factory in Dej and the Emerson factory in Cluj-Napoca. The value of these investments surpasses € 100 million.
Source: buildecon.com zf.ro infoconstructii.com statista.com sageworks.com Hospitality sector by revenue (2010-2014) The hospitality‟s best year was 2011, which was followed by a steep fall in 2012, then a steady growth starting in 2013. Hospitality market revenue, 2010-2014 (€ million) 0 60%
230 50% 0 210 40% 190 0 170 30% 140 20% 0 10% 0% 0 -10% 0 -20% 2010 2011 2012 2013 2014 Value of hospitality construction Growth
The stable growth is the result of increasing tourist activity, the low prices after the crisis made Romania an attractive destination. Furthermore, the number of overnight tourists increased a significant amount. This contributed to the growth of hotel constructions: in 2014 121 units have been completed, including 27 new hotels and 67 agro touristic units. The housing capacity at the end of the year was increased by 5500 beds.
Source: buildecon.com TOP 5 – construction industry (2014) The market share of the top 5 companies represents almost one fifth of the top 100 regarding the revenue of the companies. All of the companies headquarters are in Bucharest.
Top construction companies. by revenues and net Market share (%) TOP 5‟s headquarter profit in 2014 (€ million) 19% Strabag 168.1 1.33
Bog 'Art 130.58 0.9 81% Hidroconstrucția 115.4 -34.15 Top 5 Delta ACM 93 112.1 9.38
Astaldi SPA 86.6 15.18
0.0 50.0 100.0 150.0 200.0
The top company in the construction industry by return is once again Strabag, but looking at the realized net profit, we can see that Astaldi, which is only in fifth place in the return category, is the distant leader. The return obtained by Strabag stands for 30% of the total revenue of the top 5. The capital seems to be the most advantageous city in the country to have a headquarter.
Source: zf.ro, zi-de-zi.ro, deltaacm.ro, monitorizari.hotnews.ro TOP 5 – construction industry (2014) The industry is very dynamical since because the top 5 firms change their position each year, thus concluding that it is rapidly evolving and growing.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
Strabag 2 2
Bog „Art 3 4 8 5 6
Hidroconstrucția 3 2 1 2
Delta ACM 93 1 1 4 1 3
Astaldi SPA 14 7 10 8 19
Strabag and Hidroconstrucția have always been part of the top 5 in the past 5 years, these two have been the most stagnant amongst the top 5. The biggest changes throughout this years in position were made of Astaldi SPA who has been from 3rd place to the 25th.
Source: risco.ro 1. Strabag Strabag has the biggest revenue in Romania in the construction industry, but that is not the case in the net profit category. Their headquarters and biggest project are boh located in the capital.
Market share (%) Revenue and net profit between 2010- 2014 (€ million) 1.70%
2010 3 130 2011 1.4 136 2012 1.1 317 548 2013 21.5 229 2014 1.4 168 0 100 200 300 400 98.30% Strabag Top 100 Profit Revenue
• Bucharest • Raiffeisen Evolution • Sky Tower • PPP • Comarnic-Brașov highway • Romanian Government • Vintu de Jos-Simeria railroad section • Mantuirea Neamului cathedral • The building which will contain the world’s largest LASER
Source: zf.ro, zi-de-zi.ro, deltaacm.ro, monitorizari.hotnews.ro 2. Bog „Art Bog „Art is the second company in Romania by revenue earnings, but they are not excelling in the net profit category either, they have a very low profit margin. Their headquarters and biggest project are in Bucharest.
Revenue and net profit between 2010-2014 Market share (%) (€ million) 1.34%
2010 1 81 2011 0.6 75 2012 0.4 76 375 2013 0.5 90 2014 0.9 130 0 50 100 150 98.66% Bog 'Art Other Profit Revenue
• Bucharest • Nepi • Megamall • Globalworth Real • Auchan commercial center Estate Investmentes • Bucharest One • Alusystem • City Offices • Hyper GK Construct • Tower Center • Toni Trading • Coresi Mall
Source: zf.ro, zi-de-zi.ro, deltaacm.ro, monitorizari.hotnews.ro 3. Hidroconstrucția Hidroconstrucția is the third company in Romania regarding it‟s revenue, but they generated losses in 2014. Their headquarters is in the capital and their biggest project took place in Mureș county.
Revenue and net profit between 2010-2014 Market share (%) (€ million) 1.19%
2010 11 217 2011 11 223 2012 4 138 2013 2 133 3229 2014 -34 115 -50 0 50 100 150 200 250 98.81% Hidroconstrucția Other Profit Revenue
• Bucharest • CSC • The landfill of Mureș county • Local governments • This company is occupied • Romanian government mainly by building • Georom landfills, and water • Hidroturism conducts throughout the • Indconstruct country, their projects are, in big part, very similar one the another.
Source: zf.ro, zi-de-zi.ro, deltaacm.ro, monitorizari.hotnews.ro 4. Delta ACM 93 Delta ACM 93 is in the fourth place regarding it‟s revenue in 2014, and they occupy a respectable position in the net profit category too. Their headquarters and biggest project are both located in Bucharest.
Revenue and net profit between 2010- Market share (%) 2014 (mil. Euros) 1.15%
2010 29.4 91.4 2011 13.8 94.3 2012 4.1 113 2013 10.3 121 9.38 1396 2014 112 0 50 100 150 98.85% Profit Revenue Delta ACM Top 100
• Bucharest • Metrorex • Eroilor-Drumului Taberei metro • Astaldi section • FCC Construction • Raul Doamnei- Hasdeu metro • AB Construct section • Recently they relocated their focus on projects to other countries.
Source: zf.ro, zi-de-zi.ro, deltaacm.ro, monitorizari.hotnews.ro 5. Astaldi SPA Astaldi SPA is the fifth among construction companies in Romania in 2014 regarding their revenue, but they also excel in earning profit as they are on of the most profitable companies on the Romanian market.
Chart Title Market share (%) 0.90% 12.8 2010 4.4 76.4 2011 4.4 2012 141 -0.17 1562 70.9 2013 22 2014 86.6 15.18 99.10% Astaldi SPA Top 100 Revenue Profit
• Bucharest • Astalrom • The Mihai Bravu-Calea Văcăreşti • Delta ACM 93 overpass • MAX BOEGL Romania • Basarab passage • Arena Națională national stadium in Bucharest • Nadlac-Arad highway • Cernavodă-Orăștie highway
Source: zf.ro, zi-de-zi.ro, deltaacm.ro, monitorizari.hotnews.ro Agenda
[Global] [Europe] [Romania]
Economical overview
Construction Construction Construction industry industry industry
Real Estate industry Real Estate Real Estate
industry industry
[
Cluj
Napoca ] Real estate industry overview (2014) The GDP in 2014 was €148.7 billion. The largest industry is the manufacturing industry followed by the Trade industry. The third largest industry was the real estate, producing €14,06 billion.
The top Romanian industries by revenue in 2014 (€ billion) The construction industry as a % of the total GDP in 2014 Real 45.89 Estate 9.45%
35.84
23.53 GDP 14.1 9.35 91% 8.72
7.05 4.29 Revenue Insurance In 2014 the revenue generated by the real Bioeconomy (Agriculture & Forestry) ICT Construction estate industry represented 9.45% of the Real Estate Trade total GDP. Manufacturing industry Other
Source: insse.ro Real estate industry by revenue (2009-2014) In the period between 2010 and 2014 the average revenue was €1,64 billion.
The revenue of real estate in 2010-2014 (€ billion) 16.00 15.5% 18% 4.1% 16% 14.00 11.7% 14.10 14% 12.00 13.55 12% 11.73 10.00 10.60 10.50 10% 8.00 8% 6.00 6% 4% 4.00 2% 2.00 -0.9% 0% 0.00 -2% 2010 2011 2012 2013 2014 Revenue Growth
In the real estate industry there was registered a decrease in 2011 with a minus of 0,9%. The causes of the decrease are: lack of public investments, lack of foreign investments, political influence on projects, insufficient funding and the authorities incapability in the promotion of the projects.
Source: statista.com, capital.ro, constructiv.ro Real estate industry sectors by revenue (2010-2014) The residential sector stands for more than half ot total profit of the whol real estate market, and this will be true in the near future too. The industrial sector is presenting serious competition the the office market.
The revenue of real estate by sectors in 2010-2014 (€ billion) 8000 7132 7234.5 7000 6397.3 6634 6000 5432.3 5000 4000 2883.9 3000 2622.3 2150.5 2334.8 2329.3 2098.6 2168.6 2000 1677.4 1703.3 1132 1053.5 650.4 760.2 743.5 1004.5 676 601 1000 281.3 301.1 292.2 0 2010 2011 2012 2013 2014
Residential Office Industrial Retail Hospitality
The relation between the value and the profit of the sectors in this industry is related percentage-wise in both yearly change and inside each real estate sector. Inside these sectors the change varies from year to year, for instance in the industrial sector, the year 2011 was a great year, value numbers grew with approximetely 60%.
Source: buildecon.com, ensight.com Real estate industry by revenue – forecast (2015-2020) The annual turnover of real estate for 2015 has a stable growth, after this year it will have a stagnating tendency.
Revenue forecast of real estate industry, 2015-2020 (€ billion, %) 18.0 4.5% 17.5 4.0% 17.4 17.0 3.5% 16.9 16.5 3.0% 16.0 16.4 15.9 2.5% 15.5 2.0% 15.0 15.3 1.5% 14.5 14.7 14.0 1.0% 13.5 0.5% 13.0 0.0% 2015 2016 2017 2020 2019 2020
Revenue change (%)
During this period of time the total growth of the real estate revenue will be € 2,7 billion.
Source: statista.com, officerentinfo.ro Real estate industry by employment (2010-2014) The number of employees in the real estate market in Romania has decreased by 1.78% from 2010 (28.100) to 2014 (27.600).
Number of employees in real estate market in Romania 2010-2014 (1000 capita) 28.6 0.015
28.4 0.01 28.4 0.005 28.2 0 28.1 28 -0.005 27.8 -0.01 27.8 -0.015 27.6 27.7 27.6 -0.02 27.4 -0.025 27.2 -0.03 2010 2011 2012 2013 2014
(*1000 capita) change(%)
In the Romanian real estate market we see a significant drop in the number of employees from 2011 to 2012 (28.400 to 27.700).
Source: insse.ro Real estate industry by employment (2010-2014) The following 7 counties have had the largest pools of employees in the real estate sector in 2010-2014: Brasov, Constanta, Prahova, Ilfov, Iasi, Timis and Cluj. The most employees are in Bucharest with 6.000 capita.
TOP counties in real estate by employee number TOP 7 counties by number of employees in (2014, 1000 capita) construction industry (2014, capita) 1400 1200 1180 1200 1050 1030 960 1000 900 880 800 600 400 200 0
750-1000 Between 2010 and 2014, 4 of these counties
1000-1500 have had between 1000 and 1500 real estate employees, and Bucharest had 6000. >1500 6.000
Source: insse.ro Real estate industry by built surface (2014) The existing useable area in Romania in 2014 was 416,8 million sqm. The most useable surface was in macroregion 2, and after that in macroregion 3, where the capital is located.
Region Million sqm
Iaşi Macroregion 2 116,36 14,1 m/sqm Cluj Macroregion 3 111,8 15,8 m/sqm
Macroregion 4 83,58 Timiș 15,8 m/sqm Nord-Vest Region 55,44
Central Region 49,7
București 39,9 m/sqm Inside these the largest useable areas are in the Capital and after that the following counties are Timis and Cluj.
Source: insse.ro Real estate industry by built surface (2010-2014) Between 2010 and 2014 the total built area of completed dwellings was 35.3 million sqm, averaging 7,06 million sqm a year. Until the financial crises there was a constant growth, and from 2008 it changed to a constant decrease.
The built area of completed dwellings in Romania (million sqm) 8.00 0.0% 7.80 -1.0% 7.78 7.60 Total built are of completed 7.40 -2.0% dwellings: 56,3 million sqm 7.20 7.25 -3.0% 2000 2009 7.00 -4.0% 6.80 6.93 6.81 6.60 -5.0% 6.56 6.40 -6.0% 6.20 The highest built area of completed dwellings was -7.0% 6.00 in 2008, a total of 9,85 million sqm. After the 5.80 -8.0% 2010 2011 2012 2013 2014 financial crises it took place a constant decline. Million SQM Growth
Source: insse.ro Real estate industry by built surface (2014) From the total built area of completed dwellings in 2014, 18,2% took place in the capital and it‟s county Ilfov, a total of 1,19 million sqm.
Region Million sqm Suceava 0,41 m/sqm Macroregion 2 1,83
Cluj Macroregion 3 2,00 0,41 m/sqm Macroregion 4 0,98
Timiș Nord-Vest Region 1,07 0,34 m/sqm Central Region 0,66
București-Ilfov 1,19 m/sqm More then a half of the built area of completed dwellings in the second macroregion is located in Bucureşti and it’s county Ilfov.
Source: insse.ro Real estate industry by GFA (2010-2014) The total constructed surface of the country varies in each year, but the difference between years can not be determined as a considerable change in size.
The total constructed surface in the country between 2010-2014 (million square meters) 13 12.66 12.52 12.5
11.96 12
11.5 11.5 11.37
11
10.5 2010 2011 2012 2013 2014
The evolution of the total constructed surface in Romania varies in growth and decrease in each year during the 2010-2014 period. Each sector has a different track of change.
Source: insse.ro, hertzmanagement.ro, nineoclock.ro Real estate industry sectors by GFA (2010-2014) In each year the distant leader in constructed area is the residential sector, also the last place is occupied by the hospitality sector. The hierarchy between the sectors does not change throughout the past 5 years.
The constructed area‟s distributon by real estate sectors, 2010-2014 (million sqm) 8 7.4 7.4 6.9 6.8 7 7 6 5 4 3.1 3 3 2.5 2.4 2.5 2 1.5 1.6 1.4 1.4 1.6 0.76 1 0.48 0.53 0.5 0.23 0.2 0.18 0.31 0.22 0.19 0 2010 2011 2012 2013 2014
Residential Office Industrial Retail Hospitality
The total constructed surface in each sector varies by a little in each year. The strongest sector in this area too is the residential sector by far, with approximately 7 million square meters constructed area yearly. The residential sector represents about 55% of the total constructed surface of the total, nationwide.
Source: insse.ro, hertzmanagement.ro, nineoclock.ro Real estate industry by constructed surface – forecast (2015-2020) The biggest boom in constructed area in the near future is in 2016 in the office sector, but after this year the market will grow at a lower rate. Forecast of constructed surface by segments until 2020 (%) 25%
20.0% 20%
15% 10.6%10.2% 10.6% 9.8% 10.0% 9.8%10.3% 9.6% 10% 7.5% 7.6%7.0% 6.5% 5.8%6.0%6.0% 6.2% 6.0% 5.0%5.5% 5% 4.1% 2.8% 3.4%3.1% 2.5%
0% Residential Office Retail Industrial Hospitality
2016 2017 2018 2019 2020
• The residential sector is the only one which will show a slow, but constant rate of growth. • The industrial sector will continuously grow until 2018, after that point it will show a slight decrease.
Source: mediafax.ro, cnp.ro, dezvoltatorimobiliar.ro Properties by owners – Romania (2014) The biggest part of owners are laborers without loans, but in some regions developers own a large part of the properties. Population distibution by tenure status in The main area of interest for developers (2012) Romania (%) 100%
90% Owner occupied, no 80% outstanding mortage or housing 70% loan Owner 60% occupied, with mortgage or loan 50% Tenant - market 40% price
30% In the big university centers (Bucharest, Cluj- Tenant - reduced Napoca, Timisoara, Brasov, Iasi) the majority of renters are students. In 20% price or free Bucharest and Western Romania a significant share of properties are 10% owned by companies, because these regions have developed 0% 2012 2013 2014 2015 infrastructure, the average fiscal value being more than 25%. Up to 93% of the owners of properties are its current occupiers.
Source: Eurostat, evz.ro, zf.ro Properties by price – Romania (2009-2014) After the economic crisis he Romanian properties square meter price decreased by about 35% from 2009 to 2014.
Price of properties in Romania The price of properties by counties in Romania in 2014 (/square meter) (€/square meter ) 1400 1280 1200 1142
1000 966 903 916 891 800
600
400
200
0 Highest prices 2009 2010 2011 2012 2013 2014 Lowest prices
In 2015 in the 15 bigest cities in Romania the average square meter prices were around €754. In the small cities the prices were lower, only 570 €/square meter. Some forecasters say that by 2020 the average prices will fall to around 500 €. The most expensive properties are in the capital city and in Cluj-Napoca.
Source: bancherul.ro, ziare.com, nuwireinvestor.com, gandul.info, mediafax.ro Properties by price – Romania (2010-2014) In the previous period the agricultural land prices increased, but there is little discrepancy between the regions, unlike in the constructed lands market, where high premiums are paid for luxurious dwellings.
Evolution of the agricultural land prices in Average farmland prices by regions (€/ha) (2010) Romania (€/ha) 3500 3200 3000 Maramures Bucovina 3000 2900 2600
2500 2250 2000 Crisana 2000 3000 3200 2900 Moldova
1500 Transilvania 1200 3600 1000 3300 Banat 2800 3500 500
0 Oltenia Muntenia Dobrogea 2010 2011 2012 2013 2014 In general in Bucharest a constructed square meter costs between €200 and €300. In the downtown the prices are higher, (€450- €650), in high class areas a square meter’s cost can reach 1000€. In the suburban area a constructed square meter’s cost is low: €50, €60, up to €80.
Source: dtz.com Top 10 - real estate industry (2014) In 2014 NEPI came first in Romania with a total revenue of 80.9 million €.
Revenue and the profit of the top 10 real estate companies in Romania, 2014 (€ million) NEPI 80.9 Iulius Group 67.5
AFI Europe 58.5 Immofinanz 45.8 Baneasa Dev. 44.3 Orione 39.9 Landscape 39.2 Number of employees Niro 34.8 (100 capita) Globalworth 32.2 >20 1-3 Nusco 29.5 3-20 <1
0 50 100 150 200 250
The total revenue of the top 10 real estate companies was 423 (€ million) and the total profit was 79 (€ million) from which the Iulius Group’s had the biggest profit and the most employees.
Source: mfinante.ro, risco.ro, dailybusiness.ro, nepinvest.com, immofinanz.com, afi€ope.com, zf.ro, wall-streat.ro Top 10 - real estate industry (2014) Iulius Group had the most stable position between 2010-2014, in 2014 falling to second place, but NEPI, which is the first advanced the most.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
1. NEPI 2 1 2 5 2. Iulius 1 1 3. AFI Europe Ro 2 2 4. Immofinanz 1 1 2 5. Baneasa Dev. 6. Orione 7. Niro 2 2 8. Nusco 1 1 9. Globalworth 1 1 10. Landscape
The most position swaps occurred in 2014. New Europe Property Investment advanced the most, while AFI Erope fell down the furthest.
Source: mfinante.ro, risco.ro, dailybusiness.ro, nepinvest.com, immofinanz.com, afieurope.com, zf.ro, wall-streat.ro Real estate industry sectors by revenue (2010-2014) The Romanian sub-sector‟s revenue is largely influenced by the main clusters situated in different counties which put out 50% of the whole revenue activity.
Top counties by sectors The real estate industry by segments from 2010 to 2014 by 2014 revenue (billion EUR) 16.00
14.00 0.60 0.65 12.00 2.15 0.35 2.10 0.25 0.30 1.70 1.20 10.00 1.05 1.00 1.65 0.90 0.80 2.90 8.00 0.85 2.60 2.15 2.30 2.30 6.00 4.00 6.60 7.10 7.20 6.40 5.50 2.00 0.00 2010 2011 2012 2013 2014 Residential Office Retail Industrial Hospitality
The cluster of Romanian real estate’s office, residential and industrial subsectors main activity is situated in Bucharest, while the main activity by revenue in the industrial sector is produced in large portion in Targu Jiu. Cluj T county, the sudden rebound of 2014 in residential, office and industrial sector is mainly due to it’s impact and market rise. Constanta has the second largest commercial area.
Source: buildecon.com Residential market by revenue (2010-2014) The romanian residential construction after the economic crisis started to increase, however the revenues haven‟t grown significantly. Residential market revenue 2010-2014 Distribution of work‟s in the residential (€ billion) construction 8.0 15% 40 7.0 10% 30 7.1 7.2
6.6 onyear) 20 6.0 6.4 5% - 5.6 10 5.0 0% 0 4.0 -5% -10 3.0 -10% -20 -30 2.0 -15% (yeargrowth Real 2010 2011 2012 2013 2014 1.0 -20% New -14.3 -21.3 11 -7 6.6 0.0 -25% Renovation -16.2 5.4 -1.2 28 2.2 2010 2011 2012 2013 2014 Total -14 -18.9 9.6 -3.3 6 Revenue Growth The biggest activity in the residential sector was the renovation activity. This was a very good potential for the residential sector, because the 65% of the homes in Romania were older than 35 years. The Ministry report said that it is estimated that 2,4 million apartments don’t have proper thermal insulation. Most of Romanian houses need to be renovated, the Ministry of Regional Development estimated this market to be €1,5 billion yearly.
Source: buildecon.com TOP 5 – residential market (2014) The top 5 companies have been analyzed by return in this category. A big change has occured in the evolution of profit, which indicates that besides Nusco Imobiliara, the other companies have poor cost managements procedures. Top residential real estate companies by revenues and net profit in 2014 (€ million)
Baneasa Developments 44.3 12.2
Nusco Imobiliara 22.2 11.5
Eurogulf Investments 18.4 3.5
Future Tools Construction 3.2 9.1
BR Real Friends 7.10.05
0.0 10.0 20.0 30.0 40.0 50.0 60.0 Banesasa Development has earned € 12,2 million profit in the year of 2014. Nusco Imobiliara is its big competitor with € 11,5 million profit.
Source: zf.ro, zi-de-zi.ro, deltaacm.ro, monitorizari.hotnews.ro 1. Băneasa Developments The company‟s portfolio includes one of the largest commercial space, among which resides the most dominant mall in the capital, Băneasa Shopping City. The main tenants being Peek & Cloppenburg, Zara, H&M and Reserved.
Revenue and net profit (€ million)
201 0.23 0 30.7 Str. C A. Rosetti 178 nr. 5 201 5.1 151 Sector 1, 1 32.7 129 Bucharest 201 15 2 39.1 88 10.2 201 54 3 41 201 12.2 4 44.3
0 10 20 30 40 50 2010 2011 2012 2013 2014 Net Profit Revenue
The company has seen a very stabile growth in the recent years concerning it’s revenue, it’s Compound Annual Growth Rate 7.6% . It’s profit has risen 19.6% compared to last year.
Source: doingbusiness.ro, listafirmei.ro, risco.ro 2. Nusco Imobiliara Nusco Imobiliara SRL is the second company in this category by revenue. After a couple years of struggle, they succeeded to grow both in revenue and profit categories in 2014.
Revenue and net profit (€ million)
-0.9 2010 2.4 Bucharest, Se 59 -0.4 2011 ctor 2 2.6 50 48 43 -0.5 2012 2.8 -1.1 24 2013 2.9 11.5 2014 22.2
-5 0 5 10 15 20 25 2010 2011 2012 2013 2014 Net Profit Revenue
Nusco Imobiliara SRL had a very constant period regarding the years of 2010-2013. That is until the year of 2014 when they earned almost ten times more return than the last year and generated €11,5 million in profit. That happened mainly because the company sold the Nusco Tower for €46 million to greek businessman Ioannis Papalekas.
Source: doingbusiness.ro, listafirmei.ro 3. Eurogolf Investments Euroglf Investments SRL is on the third place on the list. The growth of the revenue is in a strong correlation with the growth of the employees.
Revenue and net profit (€ million)
-0.1 2010 0 Bucharest, 14 0.1 2011 0.1 Sector 1 -0.1 2012 0.4 0.1 6 2013 4.6 0.4 2 2014 18.4 1 0 -5 0 5 10 15 20 2010 2011 2012 2013 2014 Net Profit Revenue
The Eurogolf Investments SRL began to grow it’s revenue in the year 2013, in the same year that they hired more employees, by the end of 2014 their revenue reached a higher level of €18.4 million, when their employee number got to 18, but the extra costs of the employees and the high level of variable costs kept their net profit at low standards, however it is positive that they became profitable.
Source: doingbusiness.ro, listafirmei.ro 4. Future Tools Construction Future Tools Construction SRL is on the fourth place. With the beginning of the Trend Residence project, the company started to realize not just revenue, but an important amount of profit too.
Revenue and net profit (€ million)
201 0 1 0 Ilfov 97 92 201 0 county, Popes 2 0 ti Leordeni
201 1.8 3 4.1
201 3.5 4 9.1 0 0
0 2 4 6 8 10 2011 2012 2013 2014 Net Profit Revenue
Future Tools Construction SRL began to grow it’s revenue and profit mainly because of a project named Trend Residence. The location of the project is near to the downtown of the capital, called Popesti Leordeni, and it contains 300 new houses and 144 new apartments with gardens and balconies.
Source: doingbusiness.ro, listafirmei.ro 5. BR Real Friends BR Real Friends SRL is on the fifth place on the list. They did not go through significant changes in neither revenue or profit categories.
Revenue and net profit (€ million)
201 2.95 0 6.7 Caraș-Severin 19 201 3.68 1 7 county, 201 3.12 Buchin 2 7.15 201 3.14 4 4 3 6.8 3 3 201 3.2 4 7.1 2010 2011 2012 2013 2014 0 2 4 6 8 Net Profit Revenue
The BR Real Friends SRL has the most steady position regarding both the revenue and the net profit. After 2010 they reduced their staff numerously, but that did not show that much of a change, their profit grew a little bit more than their revenue.
Source: doingbusiness.ro, listafirmei.ro Office market by revenue (2010-2014) The office construction was in a revitalization period in 2013, after a few years of strong decline.
Office market revenue 2010-2014 Distribution of work‟s in the non-residential (€ billion) construction 3.5 14% 20
3 12% 10
2.9 onyear) - 0 2.5 2.6 10% 2.3 2.3 -10 2 2.15 8% 1.5 6% -20 -30 1 4% Real growth (yeargrowth Real -40 0.5 2% 2010 2011 2012 2013 2014 0 0% New -13.6 14 -22 6.9 6.6 2010 2011 2012 2013 2014 Renovation -31.2 16.9 -11 14.6 2.8 Revenue change (%) Total -16.6 14.4 -20.7 8.1 6
The reason for the increase of office construction started because only in Bucharest for 2013 was estimated 120 000 sq m office rooms, for 2014 a little bit more, 132 000 sq m. The growing can be the result of trends, because the companies wanted to maximize the usuage of the office rooms and started a tendention, that in evey 3–5 years the offices worth to be renovated, so the renovations level is higher than the new buildings level.
Source: buildecon.com ensight.ro TOP 5 – office market (2014) Bucharest dominates the office real estate sector, all the top companies main focus is this region, with NEPI leading with the biggest revenue in 2014.
Top 5 office real estate firms by revenue 2014 (€ million) New Europe Property Investments 24.27 Management SRL
Immofinanz AG 18.32
CA Immo 16.2
AFI Europe NV 11.7
Globalworth 7.3
0 5 10 15 20 25 30
The headquarters of the leading firms by revenue are all in Bucharest, but all of the 5 companies are in foreign hands.
Source: Romania-insider.ro; risco.ro; doingbusiness.ro TOP 5 – office market (2010-2014) Immofianz was in the first position between 2010-2013, but NEPI took the first place in 2014.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
New Europe Property Investment 1 1
Immofinanz AG 1 1
CA Immo 1 1
AFI Europe 1 1
Globalworth
The rankings of the office companies remained almost the same, the only two changes were s in 2012, when CA Immo switched place with AFI Europe, thanks to tenants developments and in 2014 when NEPI topped Immofinaz.
Source: Romania-insider.ro; risco.ro; doingbusiness.ro 1. New Europe Property Investments New Europe Property Investments had the highest revenue in the office sector with €24.27 million in 2014.
Revenue and profit, 2010-2014 (€ million)
2010 2011 2012 2013 2014 55
0 5 10 15 20 25 30 1 property
Revenue
1 property
• New Europe Property • Floreasca Business Park Investments – parent group • The Lakeview 2 properties • The Office • City Business Center
Source: Romania-insider.ro; risco.ro; doingbusiness.ro; economica.net 2. Immofinanz Immofianz has 10 properties, all having office spaces, but many of them containing also shopping areas and residential apartments.
Revenue 2010-2014 (€ million)
2010 2011 2012 2013 2014 82
0 5 10 15 20 25
Revenue
10 properties
• Irdie Business Park • Global Business Center • Immofinanz AG • S-Park • North Center – parent • Pipera I • Baneasa Airport Tower company • Victoria Park II-IV • Victoria Park I • Bucharest Corporate Center • Metroffice
Source: Romania-insider.ro; risco.ro; doingbusiness.ro; economica.net 3. CA Immo Romania Since 2001, Romania is a CA Immo core market. The company‟s main focus point is Bucharest where they developed 5 office buildings.
Revenue 2010-2014 (€ million)
2010 2011 2012 2013 29 2014
0 5 10 15 20 Revenue
Bucharest, Romania • CA Immo – • Bucharest Business Park 5 properties parent company • Europe House • Opera Center I,II • Riverplace
Source: Romania-insider.ro; risco.ro; doingbusiness.ro; economica.net 4. AFI Europe Romania AFI Europe operates in Romania since 2005, developing large scale projects such as office parks and shopping malls. AFI Park 1 is the first out of five Class A office buildings, which are going to form a 70,000 sqm office park next to AFI palace Cotroceni.
Revenue 2010-2014 (€ million)
2010 2011 2012 2013 3 2014
0 5 10 15 20 Revenue
Bucharest, Romania • AFI €ope – parent company• Accor• –AFImanagement Park 1 property company
Source: Romania-insider.ro; risco.ro; doingbusiness.ro; economica.net 5. Globalworth Globalworth's portfolio currently comprises an Asset Manager platform and fourteen real estate investments all located in Romania.
Revenue 2010-2014 (€ million)
2010 2011 2012 2013 55 2014
0 5 10 15 Revenue
8 properties
Bucharest, Romania • BOB • Nusco Tower • Globalworth • BOC • Tower Center • City Offices International • Green Court A • Bucharest One • Green Court B
Source: Romania-insider.ro; risco.ro; doingbusiness.ro; economica.net Retail market by revenue (2010-2014) The retail construction in this period was decreased, of the reaseon that the bigest shopping centers was built in 2011 or in the previous period. Retail market revenue 2010-2014 (€ billion) 1.4 25%
1.2 1.2 20% 1 1 0.9 15% 0.8 0.85 0.8 0.6 10% 0.4 5% 0.2
0 0% 2010 2011 2012 2013 2014 Revenue change (%)
In this construction type was a negative evolution. The large-scale projects has been low in 2014, the major retail centers was built in the previous period. For example in 2014 only two units were recorded: the Vulcan Value Center in Bucharest and the Targu Jiu Shopping City in Targu Jiu.
Source: buildecon.com Top 5 – retail market (2014) NEPI increased it‟s revenue by 400% in the last five years, totaling almost €81 million in 2014.
Top 5 retail real estate firms by revenue in 2014 (€ million)
NEPI 80.9
Iulius 67.52
AFI Europe Ro 58.52
Immofinanz 45.8
Anchor 10.76
0 10 20 30 40 50 60 70 80 90
The cumulated revenue of the top 5 retail real estate companies in 2014 is 263.5 million €.
Source: risco.ro Top 5 – retail market (2010-2014) NEPI had the biggest growth between 2010 and 2014. They quadruplet their revenue in this period, and became the biggest retail real estate company in Romania.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
NEPI 1 2 3
Iulius 1 1
AFI 2 2
Immofinanz 1 1 2
Anchor
NEPI in 2014 had in development investments in value of €460 million. Currently they own around 380. 000 sqm of properties in Romania, evaluated at €656 million.
Source: zf.ro; risco.ro 1. NEPI NEPI has shopping centers in 9 different counties in Romania. It has 4 shopping centers in the capital.
Revenue , 2010-2014 (€ million)
2010 2011 2012 2013 2014
0 20 40 60 80 100 1 1 Revenue 1 1 1 1
1 1 Strategic partner: CBRE Finished projects: • Mega Mall- 2015 (2015) 4 shopping • Promenada Mall – centers 2013/2014
Source: nepinvest.com; incomemagazine.ro; 2. Iulius Group Iulius Group has 4 shopping malls in 4 different counties. All 4 centers are situated in the north part of Romania. Between 2010 and 2014 had a constant growth in it‟s revenue.
Revenue, 2010-2014 (€ million)
2010 1 1 2011 2012 2013 1 2014
0 20 40 60 80 1 Revenue
Strategic partner: Iaşi • Project – Openville: City Council • Total investment: €220 million
• Total built area: 594.000 sqm
Source: dailybusiness.ro; palasiasi.ro; 3. AFI Europe AFI has 3 shopping malls in Romania. It‟s biggest shopping center is located in the capital, covering up to 104.000 sqm. Also they have 8 projects in development in Romania.
Revenue, 2010-2014 (€ million)
2010 2011 2012 2013 2014 1
-10 10 30 50 70 90 Revenue 1
Bucharest, Romania • Financial partner: • 6 projects in the capital 1 shopping Deutsche Pfandriefbank • 1 project in Arad center (€ 234 million) • 1 project of creating a village in Butimano
Source: afi-europe.eu; zf.ro; 4. Immofinanz Immofinanz near the retail properties has logistic and office properties too. They announced in 2015 that they will sell their logistic portfolio, a total of 1 million sqm.
Revenue, 2010-2014 (€ million) 1 2010 2011 2012 1 2013 2014
-10 10 30 50 70 Revenue
1
1 Bucharest, Romania • 3 projects in • Leasing agency • Accor – management partnership: Krammer & development: 1 in the Wagner companycapital, 1 in Sibiu and 1 in Braşov
Source: zf.ro; wall-street.ro; 5. Anchor Group Anchor has 14 years of experience in real estate in Romania. Near the shopping centers they also have office buildings in Romania. They had a constant decrease in revenue between 2010 and 2013.
Revenue, 2010-2014 (€ million)
2010 2011 2012 2013 2014
0 5 10 15 20 Revenue
Bucharest,• Mother company: Romania Real • Renovate of 2 shopping centers, total 2 shopping Estate Properties Fiba centers Holding investment: €25 million
Source: anchorgrup.ro; zf.ro; mediafax.ro; Industrial market by revenue (2010-2014) The industrial construction constant growth was of the reason that big factories invested in Romania and of this reason commended buildings for factories. Industrial market revenue 2010-2014 (€ billion) 2.5 70%
60% 2 2.1 2.15 50% 1.65 1.7 1.5 40%
30% 1 1.05 20% 0.5 10%
0 0% 2010 2011 2012 2013 2014 Revenue change (%) The industrial construction’s growth was very stabil. The main reason of increasing is that the investors showed for the other countries that Romania is a good place for developing. Of this reason in the Center and in the Nord-West region many strange factory taked a place, for example the Ruck factory in Tarnavei, the Trelleborg factory in Dej and the Emerson factory in Cluj-Napoca. The value of this investments is more then 100 million €o.
Source: buildecon.com zf.ro infoconstructii.com statista.com sageworks.com TOP 5 - industrial market (2014) There is 1,9 million square meters of usable industrial space in Romania, in which segment the top five most influential companies own 51% of the total industrial space.
Top 5 industrial real estate firms by revenue and net income in 2014 (€ million)
CTP 23.4
Park Point 15.6
Alinso 14.3
Cromwell 7.8 Employee number (100 capita)
Globalworth 5.2 >20 1-3 3-20 <1
0 5 10 15 20 25 30 35
The headquarters of the leading firms by revenue and ownership of land are in Bucharest, except the ones that operate from foreign countries, but their main activity is also concentrated around the capital city.
Source: doingbusiness.ro, dailybusiness.ro, TOP 5 - industrial market (2010-2014) The industrial sector by the end of 2014 has once again regained the trust of investors, becoming the second best investment sector after the office segment. Thus the top 5 companies are vastly increasing their logistic centers.
Company 2010-11 2011-12 2012-13 2013-14 2014-15 2010-2015
CTPark 1 2 1 Park Point 2 2 1 1 Alinso Group 1 3 1 5
Cromwell 3 1 4 Globalworth 1 1
The top industrial real estate firms usually maintain their position in the top 5 placement in their industry, however amongst them emerge runner-ups who manage to increase their ranking position in years in which the other competitors showed stagnancy. Such is the case for CTP, Alinso and P3.
Source: doingbusiness.ro, listafirme.ro, annual reports Romanian top 5 industrial real estate firms CTPark company owns the largest shsare of the Romanian industrial space, a total of 342,000 square meters of industrial space.
Revenue (€ million) Industrial space share (%)
2010 18 2011 2012 2013 2014 36.941
- 5.00 10.00 15.00 20.00 25.00 82
Revenue Company Other
Humpolec, Czech • Fränkische- first • Mercury Logistic Parc Republic construction project in • Cefin Park in Arad Romania • Deva Logistic Center • Yves Weerts • ProLogis Park • Dacia, Ford
Source: capital.ro, romania-insider Romanian top 5 industrial real estate firms Park Point Properties company is supported by two of the largest investment funds in the world, TPG Real Estate and Ivanhoe Cambridge, which helped him to acquire 215,000 square meters of industrial land .
Revenue (€ million) Industrial space share (%)
2010 12 2011 2012 2013 2014 30,214
- 5.00 10.00 15.00 20.00 88 Revenue Company Other
Bucarest, District 5 • CA Immo • P3 Bucharest Park • Carrefour • Europolis park • eMag • Altex
Source: economica.net Romanian top 5 industrial real estate firms Alinso Group by differentiating itself with eco-friendly and sustainable solutions has managed to draw in a sum of large multinational companies inside there establishments.
Revenue (€ million) Industrial space share (%)
2010 11 2011 2012 2013 2014 34,589
10.00 11.00 12.00 13.00 14.00 15.00 85 Revenue Company Other
Ploiesti West Park • Unilever • WestPark near Ploiesti • Saipem • ATP Terminal in Prahova • British American Tobacco County
Source: romania-news.rbe.ro Romanian top 5 industrial real estate firms Cromwell Property Group by acquiring Valad Europe it managed to gain 6% share of the Romanian industrial sector‟s usable space, a total of 81,000 square meters
Revenue (€ million) Industrial space share (%)
2010 6 2011 2012 2013 2014 21.235
- 2.00 4.00 6.00 8.00 10.00 85 Revenue Company Other
• Acquiring Valad Europe Bucarest, District 2 • Valad Europe from Blackstone • Domneşti Business Park • A1 Business Park
Source: economica.net Romanian top 5 industrial real estate firms Globalworth‟s company oqned by the Grecian investor Ioannis Papalekas, has shifted it‟s focus from the office sector and has since acquired more than 80,000 square meters of industrial space.
Revenue (€ million) Industrial space share (%)
2010 4 2011 2012 2013 2014 44,502
0.00 1.00 2.00 3.00 4.00 5.00 6.00 96 Revenue Company Other
Bucharest, Sector 3 • Valeo • TAP project in • Continental Timisoreana • Elster • Globalworth Campus • Vodafone (Pipera)
Source: officerentinfo.ro, officerentinfo.ro Hospitality market by revenue (2010-2014) The hospitality‟s best year was 2013, but after that it was a slight decrease in 2014, therefore the total revenue was € 0.6 billion in that year. Hospitality market revenue 2010-2014 (€ billion) 0.7 100%
0.6 0.65 0.6 80% 0.5 60% 0.4 40% 0.3 0.35 0.3 20% 0.2 0.25
0.1 0%
0 -20% 2010 2011 2012 2013 2014 Revenue change (%) The stabile growth is the result of increasing touristic activity, Romania after the crisis of the reason small prices was a good target for a holiday. Furthermore the number of overnight tourists increased a lot of. This influential factors helped for the hotel construction in the growth, because in 2014 121 units have been completed, including 27 new hotels and 67 agro touristic units. The housing capacity at the end of the year was increased with 5500 beds.
Source: buildecon.com TOP 5 - hospitality market (2014) In 2014 the Bucuresti Turism company had the highest turnover and net profit also. Only the Continental Hotels had a €3 million loss in 2014.
Top 5 hospitality real estate firms by revenues and net income in 2014 (€ million)
Bucuresti Turism 25.6
S.C.H.G. 25.3
Ana Hotels 25.0
Continental Hotels 20.8
T.B.R.C.M. 15.92
0 5 10 15 20 25 30
The headquarters of the leading firms by revenue are all in Bucharest. Only one company of the top 5 had a loss in 2014.
Source: Romania-insider.ro; risco.ro; doingbusiness.ro TOP 5 - hospitality market (2010-2014) The Bucuresti Turism held his leading position from 2011 until 2014. The Continental Hotels and T.B.R.C.M. was all along at the forth and fifth position.
Company 2010-11 2011-12 2012-13 2013-14 2010-2014
Bucuresti Turism 1 1
Societatea Companiilor Hoteliere Grand 2 1 1
Ana Hotels 1 1 2
Continental Hotels
T.B.R.C.M.
Despite that the T.B.R.C.M. is at the fifth position, it’s the only company in the top 5 that had all along profit, and Continental Hotels is the only one with loss in every year between 2010 and 2014.
Source: Romania-insider.ro; risco.ro; doingbusiness.ro Romanian top 5 hospitality real estate firms Bucuresti Turism had it‟s highest revenue in 2010. In 2014 the firm had the highest income and profit also.
Revenue and profit, 2010-2014 (million EUR)
2010 2011 2012 2013 2014 11
-10 0 10 20 30 40
Profit Revenue
• Elbit Imaging – parent • apartment complex 2 properties group Centre Ville • Restaurant Cina
Source: Romania-insider.ro; risco.ro; doingbusiness.ro; economica.net Romanian top 5 hospitality real estate firms Societatea Companiilor Hoteliere Grand between 2010 and 2013 was lossmaking. In 2014 achieved a 2 million EUR profit.
Revenue and profit, 2010-2014 (million EUR)
2010 2011 2012 2013 2014 301
-10 0 10 20 30 40
Profit Revenue
• Strabag – parent company • 1,2 million EUR Hotel Marriott investment in event halls
Source: romania-insider.ro; risco.ro; doingbusiness.ro Romanian top 5 hospitality real estate firms Ana Hotels had an almost 9 million EUR loss in 2013, but in 2014 it realized a 1,95 million EUR net profit.
Revenue and profit, 2010-2014 (million EUR)
2010 2011 2012 2013 545 2014
-10 0 10 20 30 3 Profit Revenue
1 Bucharest, Romania • Financial partners: • 1,5 million EUR 2 properties • BRD- Groupe Societe investment in 11 Generale conference rooms • ING Bank
Source: romania-insider.ro; risco.ro; doingbusiness.ro; zf.ro, ro.compass.com Romanian top 5 hospitality real estate firms Continental Hotels is lossmaking since 2010. It had the most employees in 2014 compared to it‟s competitions.
Revenue and profit, 2010-2014 (million EUR)
2010 1 2011 2012 1 2013 789 1 2014 1
-10 0 10 20 30 1 Profit Revenue
2 Bucharest, Romania • Accor – management • Accor – management 2 properties company company
Source: Romania-insider.ro; risco.ro; doingbusiness.ro; continentalhotels.ro Romanian top 5 hospitality real estate firms Societatea Comerciala de Tratament Balnear si Recuperarea a Capacitatii de Munca T.B.R.C.M. was the only company in the top 5 that was all along profitable.
Revenue and profit, 2010-2014 (million EUR)
2010 1 2011 1 2012 1 2013 623 1 2014 1 1 0 5 10 15 20 1 Profit Revenue 1 1 1 1 1 1
Bucharest, Romania • 0,8 million EUR investment in treatment equipment
Source: Romania-insider.ro; risco.ro; doingbusiness.ro Agenda
[Global] [Europe] [Romania]
Economical overview
Construction Construction Construction industry industry industry
Real Estate industry Real Estate Real Estate
industry industry
[ Cluj
Real Estate Napoca
industry ] Cluj & Metropolitan Area – by population (2010-2014) The Metropolitan Area total population was 434.356 capita in 2014. Cluj Napoca has more than 100.000 students yearly, so with the non-residents the total number was 517.472 capita.
The evolution of the population - Cluj Napoca Composition of the Metropolitan Area Metropolitan Area (1000 capita, 2010-2017) population including non-residents (%, 2014) 440 3.50% 2.82% 3.00% 435 19.67% 2.50% 18.08% 430 2.00% 1.50% 425 0.86% Non-Residents 1.00% -0.02% Cluj-Napoca 420 434.4 0.50% 0.00% 432.5 Growth -0.90% 430.6 428.9 Villages in the Area Population 415 0.00% 422.3 418.3 418.2 -0.50% 410 415 -1.00% 62.24% 405 -1.50% 2010 2011 2012 2013 2014 2015 2016 2017
Metropolitan Area Growth
Cluj-Napoca is one of the biggest IT Hubs in Romania, it makes growth in the whole Metropolitan Area population. Villages which is part of the Metropolitan Area: Aiton, Apahida, Baciu, Bonţida, Borşa, Căianu, Chinteni, Ciurila, Cojocna, Feleacu, Floreşti, Gârbău, Gilău, Jucu, Petr eştii de Jos, Tureni, Vultureni. Source: cmpg.ro, economie.hotnews.ro, ziuadecj.net, cjcluj.ro Cluj-Napoca metropolitan area population In 2014 103.001 people live in Cluj-Napoca‟s metropolitan area.
Cluj-Napoca metropolitan area population
104000 4% 102000 103001 3% 100000 2% 98000 99758 1% 96000 96618 0% 94000 Average growth: -1% 92000 93577 3,25 % annually -2% 90000 90536 88000 -3% 86000 -4% 84000 -5% 2010 2011 2012 2013 2014 Population Growth
Aiton, Apahida, Baciu. Bontida, Borsa, Caianu, Chinteni, Ciurila, Cojocna, Feleacu, Floresti, Garbau, Gilau, Jucu, Petrestii de Jos, Tureni and Vultureni belong to Cluj-Napoca’s metropolitan area. Floresti is the fastest growing one, it tripled it’s population since 2002. Source: insse.ro, ziardecluj.ro Districts of Cluj by population (2014) The most populous district is Mănăștur, with 30.1% of the total population, 322.108 person in 2015.
Population: 8.679 Territory: 9 km2 Density: 964 pers/ km2 Population: 16.392 Territory: 10,4 km2 Density: 1.576 pers/ km2 Population: 3.985 BULGARIA Territory: 7,1 km2 SOMEȘENI 2 Population: 8.542 IRIS Density: 561 pers/ km Territory: 12 km2 DÂMBUL ROTUND Density: 712 pers/ km2 Population: 45.656 Territory: 11,4 km2 REZ. RAHOVEI MĂRĂȘTI HR: 387
HP:
5000 3000 2 Population: 14.465 GRUIA Density: 4.005 pers/ km Territory: 18 km2 Density: 804 pers/ km2 Population: 42.211 2 GRIGORESCU CENTRU GHEORGHENI Territory: 12,9 km Density: 3.272 pers/ km2 Population: 25.418 Territory: 13 km2 2 P.C. ANDREI Population: 9.643 5000 Density: 1.955 pers/ km 5000 REZ. MEDIE
HR=417,20 HP=425,50 MUREȘANU Territory: 4,81 km2
5000 2 REZ. ALVERNA Density: 2.005 pers/ km HR=385 MĂNĂȘTUR HP=391
REZ. SUPERIOR ZORILOR HR=458,25
HP=462,75
REZ. INALTA
HR=483,0
HP=488,4
2500 2500 Population: 96.962 Population: 24.662 Territory: 26 km2 Territory: 11,2 km2 Other: 25.492 person Density: 3.729 pers/ km2 Density: 2.202 pers/ km2
Source: economie.hotnews.ro. insse.ro Cluj population – forecast (2015-2020) The forecast was completed given by the following contributory facts: fertility, rate of mortality and migration. These were combined in different measures given the circumstances.
The evolution of population change in Cluj-Napoca between 2015-2020 (1000 capita) 320.00 318.80 319.00 318.20 318.00 317.50 316.80 317.00 316.10 316.00 315.40 315.00 314.00 313.00 2015 2016 2017 2018 2019 2020
The annual averages in the examined categories were the following, number of newborns:2 209, number of the deceased: 4 130, the spore of natality is at -1 921, the spore of migration is at 1233 and the total spore, combining the previous two is at -688. The main reason for the setback of population by the year of 2020 is the big difference between the number of newborns and deceased. While migration is at a positive level, the rate of natality is a setback.
Source: cnp.ro, cmpg.ro Cluj employment – forecast (2015-2020) The rate of employment growth proves to be in correlation with the rate of economical output growth in the city of Cluj-Napoca. Both of them are constantly growing in spite of the fact that the population of the city will drop.
The evolution of employment in Cluj-Napoca between 2015-2020 (1000 capita) 144.00 142.72 143.00 142.00 141.26 141.00 139.81 140.00 139.00 138.51 137.70 138.00 137.54 137.00 136.00 135.00 134.00 2015 2016 2017 2018 2019 2020
Both categories: the number of employees and the level of economical output in the city of Cluj-Napoca is well above the average of Romanian big cities, which means that Cluj-Napoca is one of the most advanced locations of the country. Not only they are at a high level in the present, but based on the forecast until the year of 2020 both categories will rise continuously, while the population will drop, which is a serious accomplishment.
Source: cnp.ro, cmpg.ro Cluj GDP – forecast (2015-2020) The rate of employment growth proves to be in correlation with the rate of economical output growth in the city of Cluj-Napoca. Both of them are constantly growing in spite of the fact that the population of the city will drop.
The growth of economical output in Cluj Napoca between 2015-2020 (€ billion)
4.00 3.58 3.33 3.50 3.12 2.93 3.00 2.59 2.75 2.50 2.00 1.50 1.00 0.50 0.00 2015 2016 2017 2018 2019 2020
Both categories: the number of employees and the level of economical output in the city of Cluj-Napoca is well above the average of Romanian big cities, which means that Cluj-Napoca is one of the most advanced locations of the country. Not only they are at a high level in the present, but based on the forecast until the year of 2020 both categories will rise continuously, while the population will drop, which is a serious accomplishment.
Source: cnp.ro, cmpg.ro Top 10 companies by revenue – Cluj (2014) The companies with the highest revenue contribute to Cluj-Napoca‟s economy, consequently these companies have the most employees as well.
The top 5 companies by employees number in Top 10 companies in Cluj-Napoca by revenue 2014 Cluj, 2014 (€ billion) 445 MOL Romania 4.35 859 ELECTRICA 0.63 1125 EMERSON 0.55
TERAPIA 0.52 2011 FRIESLANDCAMPINA 0.40 CARRION EXPEDITION 0.38 2160 PUNCTUAL COMIMPEX 0.36 INTER CARS ROMANIA 0.35 Emerson S.R.L. ENERGOBIT 0.31 Electrica Distributie Transilvaia Nord S.A. NAPOLACT 0.23 Carrion Expedition S.R.L. Terapia S.A. - 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 5.00 Energobit S.A.
The top employing companies are in the top 10 list by revenue and contribute significantly to the evolution of the real estate economy, because of their contribution to the overall economy and because they attract employees with high salaries.
Source: netanunt.ro, catcostaclujul.ro, www.dailybusiness.ro, Top 5 companies by revenue – Cluj (2014) There were 23,081 of companies in Cluj-Napoca, of which the real estate and construction combined put out 21%. The most prominent companies are the ones headquartered in Cluj.
The structure of the economic activities Top companies in Cluj-Napoca by revenue and profit based on the number of companies 2014 2014 (€ billion) 1.36 8 MOL Romania 9.1 4.35
12.73 ELECTRICA S.A. 0.63
EMERSON 0.55 40.36
TERAPIA S.A. 28.43 0.52
CARRION EXPEDITION 0.38 Other Industry Constructions 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 5.00 Trade Services Real Estate
The two most prominent companies in Cluj-Napoca are MOL and BT due to there revenue. These also have their headquarters in Cluj, which raises the city’s GDP.
Source: listafirme.ro, clujbusiness.ro, agerpres.ro, monitorulcj.ro, doingbusiness.ro Top industries - Cluj-Napoca (2014) The largest part of companies operate in the service sector. Scientific and technical activities are dominating, but hospitality, information & communication, and transport are strong pillars, too.
Structure of the economic activities in Structure of the economic activities in Cluj-Napoca, based on revenue Cluj-Napoca, based on number of companies
0,07% 1% 0,4% Agriculture Agriculture 9% 18% Industry 29% 13% Industry 38% Energy and water Energy and water
15% Constructructions Constructructions
Services Services
Trade Trade 22% 7% 48%
Among the services, IT is the most important in Cluj-Napoca, the commercial activity is closely related to IT and construction.
Source: clujbusiness.ro Top industries - Cluj-Napoca (2014) The IT sector is in expansion, foreign investors take on startups, of which Cluj has more than any other Romanian city.
Foreign investors in Cluj-Napoca's IT industry, by country of Number of startups origin
2%2% 0% 2000 3% 1750 3% Germany 1800 4% United Kingdom 1600 29% 1370 5% Netherlands 1400 USA 1200 Austria 1000 Finland 800 15% France 600 Sweden 400 Denmark 200 Switzerland 0 22% 15% Italy Cluj-Napoca Bucharest
Cluj-Napoca has the highest number of startups in Romania. The IT market is in full swing, as many foreign investors, mainly German and English, venture into the city. The investors have a strong influence on the startup culture, too.
Source: zf.ro ICT industry - Cluj-Napoca (2010-2015) The IT sector is expected to continue its growth.
IT market value in Romania IT market value in Cluj-Napoca (€ billion) (€ million) 1380 140 1368 116 1360 120 105 1340 100 1320 76 80 1300 1282 1280 60 1260 40
1240 20 1220 0 2015 2016 2010 2011 2012
Near Emerson and Fujikura, SoftVision is one of the biggest companies in the city. SoftVision will lead in growth speed. In 2012 Fujikura Automotives had 3000 employees. The hospitality industry’s growth is driven by the growing number of leisure and business tourists.
Source: doingbusiness.ro ziardecluj.ro codespring.ro IT & SSC – Romania (2014) Cluj-Napoca‟s dominant industries are the following: IT, hospitality, construction, manufacturing and commerce.
Cluj-Napoca: Iasi: Hot spot in Romania for IT Great pool of graduates. and BPO services Romanian Silicon Valley.
Timisoara: Brasov: Well-developed. Chosen as secondary office by big IT sector expected to grow. companies.
Bucharest: Ramnicu Valcea: Concentrated, it captures more German IT investors. than half of the total IT workforce. 70% of largest companies reside here.
There are 250 IT companies in Cluj-Napoca, with 9000 employees. 100 of these are working on software development. Some Iasi is a yery good IT graduate forecasters says that by 2025 Cluj will become the Romanian Silicon Valley, with thousands of employee in the Fret Valley, a 300 area, but less attractive than Cluj. acre territory for IT companies.
Source: zf.ro accessyouth.eu dilemaveche.ro romania-insider.com ziardecluj.ro erdelyinaplo.ro minind.ro fortech.ro doingbusiness.ro IT & SSC – Romania (2014) There are 13.800 companies, 75.500 employees in the Romanian IT sector, generating €4 million revenue in 2014
The distribution of Top 3 employing The distribution of Top 3 profitable counties, 2014 (%) counties, 2014 (%)
The IT industry is the largest 26% 33% generator of businness and jobs in Romania and is growing. 46%
58% 6% 6% 11% 15% The average net salary in the IT Bucharest Cluj Iasi Other couties sector was 600 €/month. Bucharest Cluj Iasi Other couties
The Shared Service Center market in Romania is not a new one, it started growing in 2004 when companies like Oracle and then HP, Microsoft, Endava, EON, Deutsche Telecom, Office Depot, Temenos, Stefanini and many others set up their service centers in Romania in different cities like Bucharest, Cluj, Iasi, Timisoara, Brasov and Sibiu.
Source: euroactiv.ro, outsourcingadvisors.ro University graduates – Romania (2014) The following counties provide over 7.000 IT & C graduates per year.
Top 5 counties: ITC graduates in Romania (2014) 2500
2004 2006 2000 1750
1500
1118 1000
493 500
400-1000 Graduates 0 Nr 1000-2000 Graduates Brasov Timis Cluj Iasi Bucharest >2000 Graduates
27% of bachelor & master students start obtaining tehnical certifications while attending college.
Source: brainspotting.ro The influence of the students on the market In 2015 Cluj had around 80.000 students with only 12.000 places in dorms. The demand for apartments is always much higher in September, when the universities starts, causing higher rental prices.
The influence of the arriving students in September on rental prices, 2015, Cluj-Napoca Before September 140 €/M 200 €/M 350 €/M 600 €/M S T U D Bed- Two Three Luxury E sitter bedroom bedroom Apart. N T S After 200 €/M 300 €/M 400-450 €/M 750-800 €/M September
The highest demand is for apartments with two and three bedrooms situated near the universities. In this time of the year the demands for apartments are increasing almost 30%.
Source: catcostaclujul.ro; monitorulcj.ro Residential real estate in Cluj-Napoca (2014) Prices of residential real estate by number of rooms and location in 2014.
Average price/room – 2014 (€) 350 330.58
300 282.57 MĂRĂȘTI 4,94 €/m2 250 225.46
GRIGORESCU 200 4,78 €/m2 160.57 150 CENTRU GHEORGHENI 5,06 €/m2 4,84 €/m2 100
P.C. 50
5000
5000
REZ. MEDIE
HR=417,20
HP=425,50 0 ZORILOR MĂNĂȘTUR 1 room 2 rooms 3 rooms 4 rooms
REZ. SUPERIOR
HR=458,25 4,51 €/m2 HP=462,75 4,96 €/m2 REZ. INALTA
HR=483,0
HP=488,4
2500 2500
The highest average rent is in the city center, 5.06 €/m2, while the lowest average rent is in the Manastur district, 4.51 €/m2.
Source:transindex.ro Residential real estate in Cluj-Napoca (2015) Prices of residential real estate by number of rooms and location in 2015.
Average price/room - 2015 (€) 500 450 430 MĂRĂȘTI 400 370 8,72 €/m2 350 GRIGORESCU 300 250 8,65 €/m2 250 CENTRU GHEORGHENI 200 180 10,54 €/m2 8,97 €/m2 150 100 P.C.
5000
5000 REZ. MEDIE 50 HR=417,20
HP=425,50 0 ZORILOR MĂNĂȘTUR 1 room 2 rooms 3 rooms 4 rooms REZ. SUPERIOR
HR=458,25 7,83 €/m2 HP=462,75 10,03 €/m2 REZ. INALTA
HR=483,0
HP=488,4
2500 2500
The highest average rent is in the city center, 10.54 €/m2, while the lowest average rent is in the Manastur district, 7.83 €/m2.
Source:imobiliara.ro Territorial distribution in Cluj Napoca (2014) The total size of zones in Cluj is 9784.65 ha. By surface the residential zone is the biggest one, followed by the mixed zone, which includes several services, commerce, then come offices and areas aimed at tourism
The size of zones in Cluj-Napoca (ha)
Unutilized 9 Constructions 26 Central zone 42 Husbandry, cemeteries 76 Water 108 Mixed zone 109 Istitutions and services 237 Greenbelt 629 Economic activity 697 Forests 791 Transport, railroad 855 Residential zone 1922
0 500 1000 1500 2000 2500
In Cluj the share of the agricultural territories is the Expansion area Industrial park biggest, 43,75% of the total size. It is followed by the residential Greenbelt Airport Forests zone with 19,64%. Residential area
Source: primariaclujnapoca.ro The influence of the Town Hall on the real estate market in Cluj (2014) The Town Hall of Cluj Napoca has 99 properties in downtown, a total of 8000 sqm, and leases these ultra central properties to currently 75 foundations and associations for only 0.11 €/sqm.
The locations of the central properties of the Town Hall in Cluj Napoca and the buildings of the most important Central Government Authorities
BULGARIA SOMEȘENI The Town Hall of Cluj Napoca also IRIS DÂMBUL ROTUND pays almost 0,9 million € for rent in
MĂRĂȘTI
REZ. RAHOVEI HR: 387 every year. The biggest part of the HP:
5000 GRUIA3000 rent payment goes to the Unitarian Buildings of the Central GRIGORESCU CENTRU GHEORGHENI Government Authorities and Reformed Churches, and the rest for schools and kindergartens. ANDREI MUREȘANU P.C. Properties owned by the
5000
5000
REZ. MEDIE
HR=417,20 HP=425,50 Town Hall
5000
REZ. ALVERNA
HR=385 MĂNĂȘTUR ZORILOR HP=391 REZ. SUPERIOR BUNĂ ZIUA HR=458,25
HP=462,75
REZ. INALTA
HR=483,0
HP=488,4
2500 2500
Source: monitorulcj.ro; ziardecluj.ro; ziarulfaclia.ro Cluj Innovation City Cluj Innovation City is an integrated urban development project initiated by Cluj IT Cluster which is estimated to occupy an area of 200 hectares at Lomb, Cluj-Napoca.
Cluj Innovation City‟s projects: Consiliul Judeţean Cluj‟s projects: Information technology & Communication In the next period will be continued more intensively the modernization BIO Economy works of 1214,154 kilometers of county roads.
Healthcare Energy efficiency At the same time will continue the & modernization and expansion projects of Environment the International Airport of Cluj-Napoca. protection
The entire program is estimated at 500 million €, financing being provided from combined sources. Around 20.000 people will be employed in the next 15 years within this project.
Source: Clujinnovationcity.com, cpmg.ro, hotnews.ro Projects developed by the local government in Cluj-Napoca until 2020 There are many important companies that moved to Cluj-Napoca, and it is expected that the number of these companies will grow even more, that is why there are building more and more industrial parks and buildings.
The total cost of The amount of time • To create space for the project is 10.5 for this project is companies which mil. €os, of which not determined provide specialized 5,5 mil. €os are yet, but is in the services non-refundable. timespan of the • Develop following 5 years. communication between public spheres
Source: clujbusiness.ro Projects developed by the local government in Cluj-Napoca until 2020 There are many important companies that moved to Cluj-Napoca, and it is expected that the number of these companies will grow even more, that is why there are building more and more industrial parks and buildings.
The total cost of The amount of time • Logistic park for the project is 10.5 for this project is companies which mil. €os, of which not determined provide specialized 5,5 mil. €os are yet, but is in the services non-refundable. timespan of the • Develop following 5 years. communication and technology transfer to ameliorate companies
Source: clujbusiness.ro Projects developed by the local government in Cluj-Napoca until 2020 The projects, which develop the infrastructure regarding transport are one of the most important in Cluj-Napoca but also in the country. Cluj-Napoca is one of the most advanced cities in this area and continues to develop.
The total cost of The total amount of • 14,18 km the project is 20 time projected for tramcar line mil €os, of which the tramcar line renewal – whole 15,4 mil. €os are renewal is 46 road network non-refundable. months. It is • Creation of 402 expected to be square meters completed by 2018. green area • 3 new stations
Source: clujbusiness.ro Special zones - Cluj Napoca (2014) By surface the residential zone is the biggest one, followed by the mixed zone, which includes several services, commerce, then come offices and areas aimed at tourism.
Central zone Mixed zone (residential, services, trade) Residential zone Services, commerce, offices, tourism Economical act.: Retail, cash&carry, showroom Husbandry, services Services, student dormitory
2000 m
The residential zone in Cluj Napoca has a size of 1922.24 ha.
Source: primariaclujnapoca.ro Luxury residence locations in Cluj-Napoca (2015) The luxury residences in the city are very similar in terms of price and size. A portion of villas are used as pensions due to their high number of rooms.
Highlighted zone
Center (Somes) Center Calea Turzii Andrei Muresanu zone Gheorgheni zone 5500 €/mounth 4800-5000 €/mounth 5000 €/mounth 5000 €/mounth 4000 €/mounth 420 sqm 420-520 sqm 550 sqm 700 sqm 410 sqm 11 rooms Circa 9-10 rooms 13 rooms 500 sqm court With 2 terrace/8 sqm 800 sqm court
Source: monitorulcj.ro buzznews.ro Residential sector by GFA (2010-2015) The total surface of residential buildings has increased in the past years.
Residential buildings surface in Cluj-Napoca (million sqm) 2010-2015
7.2 7.15 7.1 7.01 7 6.92 6.858 6.9 6.8 6.779 6.7 6.557 6.6 6.5 6.4 6.3 6.2 2010 2011 2012 2013 2014 2015
The population of Cluj-Napoca has not increased by a significant amount, but the average habitable area per person increased from 21,8 sqm/head to circa 23,6 sqm/head. In low density residential areas the rate of green spaces is higher.
Source: primariaclujnapoca.ro The price of land in Cluj Napoca (2014) In 2014 there were 383 lands sold, 318 thousand m² with a total value of €15.8 million.
BULGARIA 119 €/m2 DÂMBUL ROTUND IRIS SOMEȘENI 44 €/m2 29 €/m2 51 €/m2
MĂRĂȘTI GRUIA 169 €/m2 97 €/m2 The highest prices of land are in GRIGORESCU CENTRU GHEORGHENI 45 €/m2 the central zone, with 251 251 €/m2 164 €/m2 €/m². The lowest prices were ANDREI P.C.
5000
5000 MUREȘANU REZ. MEDIE registered in the Iris HR=417,20 HP=425,50 78 €/m2 MĂNĂȘTUR ZORILOR district, with a difference of
REZ. SUPERIOR BUNĂ ZIUA HR=458,25 42 €/m2 HP=462,75 176 €/m2 REZ. INALTA HR=483,0 222 €. HP=488,4 101 €/m2
2500 2500 The medium cost is 50 €/m2.
Source: primariaclunapoca.ro The price of estates in Cluj Napoca (2013) Between May and December 296 territories were sold, along with 181 houses, 2455 apartments and 392 different buildings and parking places.
BULGARIA 597 €/m2 DÂMBUL ROTUND IRIS SOMEȘENI 729 €/m2 721 €/m2 711 €/m2
MĂRĂȘTI GRUIA 894 €/m2 727 €/m2
GRIGORESCU CENTRU GHEORGHENI 804 €/m2 The highest prices of estates are 846 €/m2 842 €/m2 in the Mărăști district, with 894 ANDREI P.C.
5000
5000 MUREȘANU €/m2. The lowest prices were REZ. MEDIE
HR=417,20 HP=425,50 811 €/m2 registered in the Bulgaria MĂNĂȘTUR ZORILOR
REZ. SUPERIOR BUNĂ ZIUA HR=458,25 778 €/m2 HP=462,75 824 €/m2 REZ. INALTA district, with a difference of HR=483,0 HP=488,4 820 €/m2
2500 2500 297 €.
Source: penzcsinalok.transindex.ro, zf.ro, primariaclujnapoca.ro The price of estates in Cluj Napoca (2014) In 2014 there were 383 territories sold, along with 363 houses, 3749 apartments and 1860 different buildings and parking places.
BULGARIA 709 €/m2 DÂMBUL ROTUND IRIS SOMEȘENI 881 €/m2 751 €/m2 753 €/m2
MĂRĂȘTI GRUIA 860 €/m2 866 €/m2
GRIGORESCU The highest prices of estates are CENTRU GHEORGHENI 838 €/m2 874 €/m2 870 €/m2 in the Andrei Mureșanu ANDREI P.C. district, with 910 €/m2. The
5000
5000 MUREȘANU
REZ. MEDIE
HR=417,20 HP=425,50 910 €/m2 lowest prices were registered in MĂNĂȘTUR ZORILOR
REZ. SUPERIOR BUNĂ ZIUA Bulgaria, with a difference of HR=458,25 779 €/m2 HP=462,75 845 €/m2 REZ. INALTA
HR=483,0 HP=488,4 798 €/m2 2500 2500 201 €.
Source: primariaclunapoca.ro The level of rents – Office, commercial and industrial market (2014) Rental levels across the country remained constant throughout 2014. The highest prices were registered in the commercial sector, the lowest in the industry market.
The medium price of rents in Cluj (€/m2/month) 14 12 12 10 8 9 6 4 2 3.5 0 Retail Office Industry
The average rent of the commercial, office and industrial markets is 8,2 €o/m2/month. The rent in the industrial market is only 29,2% of the one in the commercial market.
Source: realestate.bnpparibas.com, lpg-roumanie.ro, content.knightfrank.com, dtzresearch.ro Office sector by GFA (2010-2015) The total surface of office buildings has increased in Cluj-Napoca in the past years, due to foreign companies setting up offices in the city.
Total surface of office buildings (sqm‟000) 2010-2015 200 180 160 140 120 100 80
60 Thousands sqm Thousands 40 20 0 2010 2011 2012 2013 2014 2015 Completions 1.5 35 12.5 8.5 49 20 Existing stock 73.5 75 110 112.5 121 170
The surface of offices in Cluj-Napoca has increased in the past years, due to big international companies choosing the cityfor their office. Some of the biggest companies: iQuest, wiht 6000 sqm office and 380 employees, CREIC, with 2230 sqm office and TEAM, with 3301 sqm office buildings and support space.
Source: clujbusiness.ro cluj24h.ro clujinnovationpark.ro iquestgroup.com capital.ro Top 5- office sector (2014) All of the biggest business centers in Cluj-Napoca are in the “ A “ category, this being the result of major international companies being present in the city. The leasing prices are between 10-14 €.
Company Category Developer Area (sqm) Year of construction Lease (€)
1 The Office A NEPI 19,000 2014 13,5
2 Coratim Business Center A Coratim 16,000 2006 12-13
3 Sigma Business Center A Sigma 14,500 2006 11
4 Liberty Technology Park A Fribourg 13,400 2014 10
Iulius 5 United Business Center A 10,000 2014 12 Group
In the top 5 there are 3 business centers which have been built in the last year. All of them are “A” category buildings and are in the same price range. Three of them have been developed by their own companies. However the difference in usable area between the top seed and the fifth is 9,000 square meters, which represents almost double of it. 1. The Office Business Center The Office Business Center is the biggest and newest one in Cluj-Napoca.
1 Category Common area Construction Lease Developer The Office Area A ratio: 10% 19000 m2 year: 2014 €13.5 NEPI On the map: Main leasers:
• Yardi
• Ernst&Young
• Deloitte
Parking spots 1700
Address: Bulevardul 21 Decembrie 1989 Rate of leasage: 100%
History: Equipment: . The Office Business Center was the biggest project of 2014 in the office sector . Building Management System in the country . Underground parking lot ( 1700 . Between the beginning of the project and the end of the construction there was spots) only a one year difference . Conference room with 150 seats .At the date of it’s opening The Office was leased already in 90%, in the present . Certificate BREEAM-green building it is fully leased
Source: bioruinfo.ro, theofficecluj.ro 2. Coratim Business Center The Coratim Business Center is the second largest in Cluj-Napoca.
2 Coratim Category Common area Area Construction Lease Developer Business Center A ratio: 5-20% 16000 m2 year: 2006 €12-13 Coratim On the map: Main leasers:
• RBH Technologies
• Pitech+Plus
Parking spots 130
Address: Strada Campul Painii 3-5 Rate of leasage: 80%
Equipment: History: . Parking lot (130 spots) . The Coratim Business Center was built in 2006 . Elevators for products and staff . In the recent years they managed to get a rate of leasage of 80% separately . After the construction of The Office, Coratim is now the second biggest business . Conference room center in Cluj-Napoca . Events room . They developed an event hall for hosting company events
Source: coratim.ro 3. Sigma Business Center The Sigma Business Center is the third largest in Cluj-Napoca.
3 Sigma Category Common area Area Construction Lease Developer Business Center A ratio: 5% 14500 m2 year: 2006 €11 Sigma On the map: Main leasers
• Siemens
• Banca Transilvania
• Sykes
• Accenture Parking spots 350
Address: Str.Republicii Nr.109 Rate of leasage: 100%
Equipment: History: . Underground parking lot (350 . The Sigma Business Center was built in 2006 spots) . In the recent years they managed to get a rate of leasage of 100% . Sigma Shopping Center . The developer built a shopping center on an area of 7000 square meters with . Restaurants and caffes more than 30 shops and restaurants . Granata GYM . In the present day all of it’s usable area is leased
Source: sigma.ro 4. Liberty Technology Park The Liberty Technology Park is the fourth largest in Cluj-Napoca.
4 Liberty Category Common area Area Construction Lease Developer Technology Park A ratio: 5-10% 13400 m2 year: 2006 €10 Fribourg On the map: Main leasers
• Siemens
• Impact Hub
• halcyonmobile
• KPMG Parking spots 565
Address: Strada Gării nr. 21 Rate of leasage: 100%
History: Equipment: . The Liberty Technology Park was built in 2013 . Parking lot (565 spots) . It is the first tech park in the country . IT infrastructure . There is a business accelerator, Spherik, the most complex business accelerator . Medical care in Romania for startups . Green space with gardens and lake . Restaurant with terace
Source: libertytechpark.ro 5. United Business Center Tower The United Business Center Tower is the fifth largest in Cluj-Napoca.
5 United Business Category Common area Area Construction Lease Developer Center A ratio: 5-20% 10000 m2 year: 2014 €12 Iulius Group On the map: Main leasers
• Endeva
• Genpact
Parking spots 2500 (access to Iulius parking lot)
Address: Strada Al. Vaida Voievod nr. 51 Rate of leasage: 100%
History: Equipment: . The United Business Center Tower was built in 2014 . Private parking lot . It is the second business center developed in the vicinity of the Iulius Mall by . Security services (non stop) the Iulius Group . Direct access to Iulius Mall Cluj . In the moment of it’s opening it was already fully leased; it’s leased by only two . Repair services for leasers companies: Endava and Genpact . Common area cleaning services
Source: unitedbusinesscenter.ro Retail sector by GFA (2010-2015) Cluj Napoca plays an important role in the commercial industry, this is reflected by the increase of its commercial surfaces.
Retail surface, 2010-2015 (sqm „000) 120.00 105.10 100.00 92.78 83.60 80.00 75.90 68.40 62.20 60.00
40.00
20.00
0.00 2010 2011 2012 2013 2014 2015
The total modern commercial buildings surface in Romania is 1,7 million sqm, nearly 1 million of it being in Bucharest and circa 10% of the rest in Cluj-Napoca. In the city there are several malls with circa 10 000 sqm surface. From 2009 the commercial surface grew by 50% each year.
Source: zf.ro blog.remsimobiliare.ro Land Measurement, Natural and Human Sciences Reserach Articles Retail buildings in Cluj-Napoca (2015) Cluj-Napoca has the third largest commercial useable space in the nation, 105.100 square meters. However the trend does not give way for the larger brands to open businesses in the central area, due to large rent and low accessibility.
BULGARIA SOMEȘENI IRIS DÂMBUL ROTUND
REZ. RAHOVEI MĂRĂȘTI HR: 387
HP:
5000 GRUIA3000
GRIGORESCU GHEORGHENI CENTRU
ANDREI MUREȘANU P.C.
5000
5000 REZ. MEDIE 30-40 €/mp HR=417,20
HP=425,50 25-30 €/mp
5000
REZ. ALVERNA
HR=385 MĂNĂȘTUR ZORILOR HP=391 20-25 €/mp REZ. SUPERIOR BUNĂ ZIUA HR=458,25
HP=462,75
REZ. INALTA
HR=483,0 HP=488,4 20-25 €/mp 2500 2500 15-20 €/mp
Because the ultra central zone is mainly dominated by buildings with an average surface area of no more than 100 sqm, the major brands target the city’s two malls, due to their increased pedestrian traffic and parking possibilities.
Source: oradebucuresti.oradestiri.ro, remsimobiliare.ro Hospitality sector by GFA (2013-2015) The business tourism being on the rise, the surface occupied by the hospitality industry‟s payers is increasing.
Hospitality surface in Cluj-Napoca (sqm'000) 2013 - 2015 180 170 160 156 140 140 120 100 80 60 40 20 0 2013 2014 2015
The hotel and motel capacity growth exceeded 10%, the surface growth being steady. The luxury hotels, with five stars, for the reason business turism got rounded in the city.
Source: banknews.ro comunicate.mediafax.biz Hotel locations in Cluj-Napoca (2015) In Cluj-Napoca are 196 hotels, mainly in and around the city center.
Zone
1-4 hotels
5-15 hotels
More, than 15 hotels
Western outskirts 450000 € 900-1100 sqm- 16 rooms
Fantanele hotel Floresti: Hotel Sport Grand Hotel Hotel Melody: Neptun-Olimp Tulip Inn Sunny complex (Bianca and 1,2million € 6 million € Buna Ziua zone 4,8 million € (Amfiteatru, Belveder Hill Radu) 900 sqm - 18 6235 sqm/3800 40 million € 2200 sqm e, Panoramic) 30 6,5 million € 5 million € rooms sqm util - 127 30000 sqm-167 Restaurant, kit million €, 6200 sqm- 50 rooms 63000 sqm-30+30 rooms rooms rooms chen 750 rooms 5000 sqm
Source: booking.com monitorulcj.ro hoteluri24.net iresearch.ro actualdecluj.ro adevarul.ro stiridecluj.ro Restaurant locations in Cluj-Napoca (2015) There are more than 400 restaurants in the city, the rent paid depends on the location; in the city center, the average rate is 3000 €. Center and semi – center area
1 - 4 restaurants
5 - 15 restaurants
More than 15 restaurants
Center Piata Unirii Piata Mihai Semi-center Marasti Average: 2200 €/month 4000 €/mounth Viteazul 1800 €/month 1200 €/month Average: 250 sqm 350 sqm 1260 €/month 250 sqm / circa 10 140 sqm, or Lowest price: 500 €/48sqm, highest price: With terrace 180 sqm €/sqm/ month 2500 €/month 2500 €, in general with terrace (100 sqm) Terrace: 300 sqm 300 sqm
Source: buzznews.ro consulting4you.ro blitz-imobiliare.ro spatiicomerciale.ro casaclasic.ro rbcimobiliare.ro Industrial sector by GFA (2013-2015) The development of Tetarom drove the growth of the industrial area segment.
Industrial area surface in Cluj-Napoca (million sqm) 2013 - 2015
3.5 3.308 3 2.458 2.5 2.42
2
1.5
1
0.5
0 2013 2014 2015
The bigest industrial park in Cluj county is Tetarom Industrial Park with a surface of 1,6 million sqm. The first park was built in 2005, Tetarom IV (850 000 sqm) is now under construction. ARC Industrial park (Dej, 40 000 sqm) is located near Cluj, as well as S.C. REIF Construct SRL, with 440 000 sqm developed infrastructure.
Source: ccir.ro snia.ro cluj24h.ro cjcluj.ro revistaconstructiilor.eu ils-forschung.de ziuadecj.realitatea.net Top 3 counties by trade and logistic centers (2014) The number of important companies in the light industry, trade centers, logistics centers, research and development in Cluj-Napoca, Timisoara and Bucharest.
Cluj-Napoca: Light industry:88 Trade centers:5 Logistics centers:3 GDP/capita 2014 () R+D:3 25.0 Timisoara: 19.7 Light industry:12 20.0 Trade centers:4 15.0 Logistics centers:2 9.5 9.7 R+D:2 10.0
5.0 Bucharest: Light industry: 41 0.0 Trade centers:8 Cluj Napoca Timisoara Bucharest Logistics centers:3 R+D:2
Although the Cluj GDP is 9 500 €/capita in Bucharest or Timisoara it is over 9 700. Cluj has 88 companies operating in the light industry, Bucharest 41 and Timisoara 12.
Source: economismul.ro, firmeclujnapoca.ro, businessmagazin.ro The industrial segment in Cluj (2015) In Cluj county are 4 finished industrial parks an 1 in construction and 1 logistic park totaling over 1,9 million m2 . Tetarom has 3 industrial parks finished and Tetarom IV in construction
Tetarom I Arc parc industrial
• 320000 m2 , in Cluj-Napoca • 9900 m2 , in Dej • Over 50 companies: EnergoBit, Banca • Fujikura and Telleborg companies Transilvania, RCC Consult, Siemens and others Tetarom III • 100% occupied • Over 1440 jobs • 1.540.000 m2, in Jucu • Over 46 million(€) investment • 8 companies: Bosch, De’Longhi, Imperial, Star Tetarom II Storage, Henschel România, IL Caffe Servexim, Contrast Import Export, Karl Heinz Dietrich International Exped 2 • 120000 m , in Cluj-Napoca • Over 2100 jobs • 100% occupied and 99% owned by Emerson • Over 176 million(€) client investment investment • Over 2210 jobs • Over 83 million(€) investment Transilvania Logistic Park
Tetarom IV • 83137 m2, in Cluj-Napoca • Over 80 companies: Profi ROM Food, tar Foods • 850.000 m2, in Cluj-Napoca in construction EM, Schenker- Romtrans, Danone PDPA and others • Over 1200000(€) is the project value • 3.20€/m2/month+TVA
When Tetarom IV is finished, the 5 industrial parks and the logistic park will total over 2.8 million m2.This parks offers more than 10.000 jobs and will increase Cluj county’s revenue constantly.
Source: minind.ro, tetarom.ro, zf.ro, arcparc.ro, parclogistictransilvania.ro; Logistic centers in Cluj (2015) Cluj has a high number of logistic centers, mainly located on the eastern outskirts of the city.
BULGARIA SOMEȘENI IRIS DÂMBUL ROTUND
REZ. RAHOVEI MĂRĂȘTI HR: 387
HP:
5000 GRUIA3000
GRIGORESCU GHEORGHENI CENTRU
ANDREI MUREȘANU P.C.
5000
5000
REZ. MEDIE
HR=417,20
HP=425,50
5000
REZ. ALVERNA
HR=385 MĂNĂȘTUR ZORILOR HP=391 REZ. SUPERIOR BUNĂ ZIUA HR=458,25
HP=462,75
REZ. INALTA
HR=483,0
HP=488,4
2500 2500
Logistic centers are mostly located in the suburbs: in the Metropolitan Area mostly.
Source: dezvoltator-imobiliar.ro Romanian RE market summary
2010-2014 2015-2020 Residential
Revenue 7,58% 6% Office RE
Retail Total Total Industrial Employment -0,44% Hospitality
Revenue Profit GFA Top companies Headquarters Portfolio Value 2% 5% Residential Baneasa Development Romania €44 million 4% 7% 20% 20% Office NEPI South-Africa €25 million 40% 18% 50% 15% Retail NEPI South-Africa €55 million 14% 68% 13% Industrial CTPark Czech €23 million RE Subsectors RE 2% 22% Hospitality Bucuresti Turism Romania €23 million Romania Cluj
GDP (%)
Revenue
Price
sqm Cluj Romania Forecast
Residential
Office
Retail
Industrial Real Estate Real
Hospitality
>10% <10% 1-3% +-1% BULGARIA SOMEȘENI DÂMBUL ROTUND IRIS
REZ. RAHOVEI HR:387 HP: 3000 5000 MĂRĂȘTI Small GRUIA € 1-3 mill Residential GRIGORESCU investor CENTER GHEORGHENI P.C.
5000 5000 REZ. MEDIE HR=417,20 HP=425,50 A. MUREȘANU
5000 REZ. ALVERNA HR=385 HP=391
REZ. SUPERIOR HR=458,25 HP=462,75
MĂNĂȘTUR REZ. INALTA HR=483,0 HP=488,4 ZORILOR 2500 2500 BUNĂ ZIUA
I L BULGARIA SOMEȘENI Residential DÂMBUL ROTUND IRIS
REZ. RAHOVEI HR:387 HP: I 3000 5000 MĂRĂȘTI Medium GRUIA € 3-10 mill GRIGORESCU investor CENTER GHEORGHENI
P.C.
5000 Industrial 5000 REZ. MEDIE HR=417,20 HP=425,50 ANDREI MUREȘANU L
5000 REZ. ALVERNA HR=385 HP=391
REZ. SUPERIOR HR=458,25 HP=462,75
MĂNĂȘTUR REZ. INALTA HR=483,0 HP=488,4 ZORILOR 2500 2500 BUNĂ ZIUA
I Residential BULGARIA SOMEȘENI DÂMBUL LROTUND IRIS
Large REZ. RAHOVEI HR:387 HP: 3000 5000 MĂRĂȘTI I > €10 mill GRUIA investor Industrial GRIGORESCU CENTER GHEORGHENI
P.C.
5000 5000 REZ. MEDIE HR=417,20 Office HP=425,50 ANDREI MUREȘANU L
5000 REZ. ALVERNA HR=385 HP=391
REZ. SUPERIOR HR=458,25 HP=462,75
MĂNĂȘTUR REZ. INALTA HR=483,0 HP=488,4 ZORILOR 2500 2500 BUNĂ ZIUA