Proceedings of the 5th WSEAS International Conference on Economy and Management Transformation (Volume I)

Changes in the Urban Functional Zones Triggered by the Development of Commercial Services

RADU SĂGEATĂ Faculty of Tourism Geography “Dimitrie Cantemir” Christian University 5-7, Acad. Simion Mehedinţi Street, Sibiu, RO-550245 [email protected]

VIRGINIA GHERASIM Faculty of Tourism Geography “Dimitrie Cantemir” Christian University 5-7, Acad. Simion Mehedinţi Street, Sibiu, RO-550245 ROMANIA [email protected]

TEODOR TODERAŞ Faculty of Tourism Geography “Dimitrie Cantemir” Christian University 5-7, Acad. Simion Mehedinţi Street, Sibiu, RO-550245 ROMANIA [email protected]

MARIA BUD Faculty of Tourism Geography “Dimitrie Cantemir” Christian University 5-7, Acad. Simion Mehedinţi Street, Sibiu, RO-550245 ROMANIA [email protected]

CLAUDIA BUCURA Faculty of Tourism Geography “Dimitrie Cantemir” Christian University 5-7, Acad. Simion Mehedinţi Street, Sibiu, RO-550245 ROMANIA [email protected]

Abstract: The fall of the communist regime and the demise of the bipolar order have led to the development of globalising connections in the urban systems of the Central and East-European states. The main social impact of this complex phenomenon is the expansion of the diffusion area for the of global consumerist goods, entailing the development and the diversification of commercial services. Their localisation is still a direct consequence of financial segregation; the determining agent of the degree of penetration of global consumer goods at local level is the localisation and dispersion of investments. In this context, the article analyses the strategies of localisation and the dispersion factors of commercial services in the Romanian urban system and in its capital city, in particular.

Key-Words: globalising flows, global consumerism goods, commercial services, hypermarkets, malls, Romania.

ISSN: 1792-5983 27 ISBN: 978-960-474-240-0 Proceedings of the 5th WSEAS International Conference on Economy and Management Transformation (Volume I)

1 Introduction specialist services units ended up in big commercial The downfall of the communist system in Central complexes. Their localisations are seemingly the and Eastern Europe and the abolishment of the result of increasing social segregation, tending to limit ideological barriers have created the premises for the area in which this type of goods and services are closer globalising links within the urban systems from likely to be spread, because demand rests with a this part of the Continent. specific segment of users. Hence, a new type of urban- On the line of former experience as COMECON rural polarisations, directly proportional to social and members, the first half of the 1990s witnessed, after cultural segregation, is dependent upon the capacity of the dissolution of that organisation, a rise in the the Romanian urban system to absorb the globalising volume of trade exchanges, of imports in particular; fluxes. The severe financial disparities, affecting the services and investments were aimed at developing urban population in the wake of industrial small and medium-sized enterprises. restructuring, filter the penetration of globalising fluxes. At local level, although the items produced by the culture of consumption are somehow easily penetrating, they are not very accessible. Thus, the 2 Problem Formulation combination of global culture with endemic lack of Towns acted as nuclei, polarizing and re-directing culture grafted on poverty, is a fertile ground for the fluxes in the territory. However, development, as it recrudescence of urban sub-culture and organised were, could not compensate for the industrial decline crime [1]. and its demographic and especially social The potential of the outlet market is a decisive consequences. After over fifty years of forced factor in earmarking investments to big commercial industrialisation drive associated with hypertrophy units, e.g. malls (which gather together a wide range development, the Romanian urban system has been of shops and services units, restaurants, recreation and experiencing a radical transformation, basically de- entertainment areas, cinema-halls, banks, swimming- urbanisation both as regards town population and pools, play-grounds for children, etc.), or town quality, its functional attributes undergoing supermarkets, chains of stores usually set up by substantial changes. Thus industry, which was the transnational companies. main factor of urbanisation for almost all of

Romania’s towns, has been overcome by the tertiary sector, a phenomenon specific to large cities, the capital and the regional metropolises strengthening 3 Problem Solution their co-ordinating positions in the territory. Large 3.1. Financial and Commercial Investments cities tend to assume the attributes of cosmopolite The logic behind the establishment and diffusion in cities due to greater ethnical diversity, the the territory of these commercial units closely development of specialist services and the large-scale correlates with the location of banks, according to the assimilation of global consumerist goods, basically spatial, income-based segregation of the population. products and services which go beyond geocultural Thus, large commercial units (malls and hyper- spaces. Foods and fashion items have the strongest markets) are frequently opened up in large cities with impact on the population. Almost 75-80% of the space macro-regional polarising functions and a positive allotted to malls in occupied by fashion shops and 10- economic dynamic that ensures an outlet market 15% by restaurants. The settlement in Romania of competitive enough, in terms of both financial and Arab, Turkish, or Chinese nationals engaged in quantitative considerations, so as to guarantee trading or in small industrial businesses, the presence profitability. On the other hand, investments in towns of foreign citizens who have come to study here, of that are at the base of the urban hierarchy materialise the personnel of diplomatic missions, of multinational in supermarkets, but if towns have below 30,000 firms or NGOs has diversified the services sector inhabitants they are considered to be unprofitable [2]. (Chinese, Libanese, Italian or Greek restaurants; The same pyramidal distribution observed in the French or German bakeries; African, Indian or Latin- case of financial investments holds also for American artisan shops, etc.). Their localisation commercial units, provided that the extent of the within commercial centres (malls and hypermarkets) investment is directly proportional to the size of the explains the importance of these units for the local respective town. The east/west financial segregation diffusion of the products of global consumerist mirrors the development of commercial services, this culture. type of investment being drawn mainly by With the concentration of incomes in the Capital and the large cities from Transylvania and Banat. and in the large cities, commodity markets, or Thus, the largest malls are situated mainly in

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Bucharest (Bǎneasa Shopping City, AFI Palace Cora Hypermarket. However, in the conditions of the Cotroceni, , , Bucharest present economic-financial crisis its profitability is put Mall, Liberty Center, etc.) and in four western in question, because the southern city districts metropolises: Timişoara, Cluj-Napoca, Arad and (Ferentari and Rahova) are inhabited by lower-income . people, have social problems and moreover it has to 3.2. Strategies of Placing Commercial compete with similar structures recently Investments commissioned (City Mall, Grand Arena and Liberty Bucharest was the first Romanian city in which Center). However, these are drawbacks that might be malls were set up. The Bucharest Mall (initial trade compensated for by locating Sun Plaza in a area 37,000 m2) was opened on September 10, 1999. convergence area of population fluxes (Piaţa Sudului) Situated in Vitan district, in a dismantled urban area, with access to the underground network through a this mall has rapidly become a point of convergence in subterranean passage [6]. That this type of the city. As a result it was enlarged up to 99,000 m2 in investments has a positive dynamic is confirmed by 2003 and 2007, hosting 140 stores, most of them the opening of such poly-functional centres in most subsidiaries of international companies’ sales units country-seats, outstanding among them being: Iulius [3]. In 2004, the same investor opened the second mall Mall in Iaşi and Arena City Center in Bacǎu in the west of Bucharest, between the Militari and (Moldavia), Tiago Mall in Oradea, housing an in-door Drumul Taberei districts. This investment, called skating-rink, the first in a series of 10 Tiago malls to Plaza Romania, was intended to be the largest the built in towns with over 200,000 inhabitants; commercial centre of its kind, with a built-up area of Atrium Center in Cluj-Napoca, and 104,000 m2 profiled on shopping (over 150 stores), Polus Center in Constanţa, Civis Center and Plaza fast foods, entertainment and business. However, its Center in Timişoara, Mega Mall in Braşov, supremacy was short-lived: in 2005 the largest mall at Promenada Mall in Sibiu, Euromall in Galaţi and the time was commissioned in Timişoara, a cross- Ploieşti etc (Fig. 1). border convergence point of the Danube – Criş – In the northern part of Bucharest stands Bǎneasa Mureş – Tisa Euroregion; two years later another Fashion Center (85,000 m2 rentable area, basically complex was opened in Cluj-Napoca (November 10, twice that of Plaza Romania or of Bucharest Mall), 2007). The same developer opened up Julius Mall in with over 220 stores, opened on April 18, 2008. It is 2 Suceava (September, 2008), overall area 132,000 m part of the Bǎneasa Sopping Center complex, a 2 2 (out which 67,500 m built-up spaces and 45,000 m commercial area of hypermarkets (Metro, Carrefour, for rent and 150 shops). It was the biggest unit of its Bricostore and IKEA) with a total built-up area of knid in Moldavia, and a regional convergence point 250,000 m2. It offers modern shopping, entertainment for the counties of Suceava, Botoşani and Neamţ, as and business facilities. Its location was chosen well for the cross-border area with Ukraine and the because of transport facilities: Bǎneasa and Otopeni Republic of Moldova. One year later, on October 29, airports, Bǎneasa railway station and prospectively a 2 2009, the AFI Cotroceni (214,000 m ), investor the heliport. Bǎneasa Shopping Center holds a singular AFI Europe, Israeli Group, was commissioned. This is position as the district it lies in has the highest GDP the biggest mall-type centre in Romania and in per capita, remarkable demographic growth and a Eastern Europe. The construction, raised on the site of flourishing built-ap area. This mall alone brought 45 a former factory, houses 300 shops and the “Real” new international brands in the Romanian market. hypermarket, the largest skating-rink and karting track The same distribution in the case of hypermarkets built inside a commercial centre, an escalade wall, a and supermarkets. Positive segregation exists in bycicle track, a lake for small electric boats, play- Bucharest, in some counties from Transylvania, Banat grounds for children, a cinema-hall with 20 screens, and in Constanţa County, strictly correlating with the the first IMAX (3D) in Romania, two casinos an polarisation of incomes; negative segregation have the exhibition hall and many more attractions [4]. counties from the eastern and south-eastern parts of Forthcoming is the construction of four offices Romania. Thus, according to a study made by the 2 buildings (cca 12,000 m ) and a 4-star hotel. The same market research company MEMRB Retail Tracking consortium has scheduled two projects for the near Services in October 2006 and October 2007, the future: in Ploieşti (AFI Palace Ploieşti) and in the counties most likely to be targeted for the expansion Bucharest district Bucureştii Noi (AFI Bucureşti) [5]. of such commercial lines were Sibiu, Constanţa and In February 2010, another mall – Sun Plaza (210,000 Mureş, while Botoşani, Tulcea, Teleorman and Buzǎu, 2 2 m , out of which 80,000 m , commercial area) was featured almost exclusively traditional trading [7]. added to the network. It is a 200 million euro worth Spatially, two types of distribution seem to emerge: investment which houses 150 shops, coffee bars and

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Figure 1. Romania. Investments in malls development of commercial parks: Bǎneasa outside Bucharest on DN1 highway to Ploieşti; Militari on A1 one going from Bucharest to the major cities (e.g. to Piteşti and Dragonul-Roşu on the highway to Cora, Carrefour, Metro, Auchan, etc.) and a second Voluntari-Urziceni. A similar commercial park is one from cities located in the west of the country, scheduled to develop in the Lujerului-Cotroceni area especially Timişoara and Cluj-Napoca (e.g. Selgros, and encompass also Cora Lujerului hypermarket, Spar, Profi, Real, etc.). There is also spatial Plaza Romania and AFI Cotroceni malls. Student complementariness: some companies (Profi, Spar) campuses are considered potential markets for prefer Bucharest and the major cities from commercial complexes. Carrefour Orhideea, placed in Transylvania, others opt mostly for the the close vicinity of the student campuses Grozǎveşti extracarpathian area (Proges, Mini Max Discount, and Regie, is a typical example of such a strategy. etc.) (Fig. 2). Iulius Mall in Iaşi and the new Iulius Mall in Cluj- Most malls built in Bucharest (Bucharest Mall, Napoca, located in the Gheorgheni district, near the Plaza Romania, City Mall and Liberty Center) have campus of the University of Economic Sciences, been raised on the site of the unfinished buildings of follow to the same location logic, besides like in other former food complexes (mockingly, people used to cases entertainment is complementary to shopping. call them “hunger circuses”), whose construction had Other establishments having in view the same begun in the 1980s in convergence areas of population complementariness, combine tourist services with flows, subsequently contributing to the development residential environments: Eliana Mall in Braşov of their neighbourhoods. The next investments had in situated in the Bartolomeu commercial district, view either empty spaces on the outskirts of the city towards the tourist area of Bran resort; City Park on (Carrefour and Metro Militari, Cora Pantelimon), the outskirts of Constanţa (Tabǎcǎriei area), on the using the rail-and-road infrastructure in place at the road to Mamaia sea-side resort. margin of Bucharest, or the sites of former industrial Another location strategy is to modernise the large units later demolished (e.g. Cora Lujerului, built on commercial units built before 1989 (the so-called the site of a dairy factory, could use Cotroceni railway universal stores) and turn them into malls. The most station), similarly AFI Cotroceni Mall, situated on the typical example of such a strategy is Unirea stores in premises of the former UMEB plant, had the Bucharest, which was extended and updated into what advantage of a railway infrastructure. is now , with a Carrefour Advantageous locations lead in time to the hypermarket developing in its proximity.

ISSN: 1792-5983 30 ISBN: 978-960-474-240-0 Proceedings of the 5th WSEAS International Conference on Economy and Management Transformation (Volume I)

3.3. The Social Impact Mureş) have been closed down. The social impact of these trading centres is worth considering. The concept of “mall” goes beyond the strict commercial function, being associated with luxury and fashion: one goes to a mall to see new trends, socialise, make acquaintances with a certain segment of the population. Therefore, financial segregation combines with social segregation, both being embodied in commercial segregation, and malls are the best way to express it. Not surprisingly, in some commercial centres shopping and business facilities are associated with social facilities (e.g. Julius Mall in Timişoara has a register office and a chapel). Besides fashion clothes, cosmetics, accessories and household appliances shops, malls include fast food restaurants, coffee shops, multiplex cinemas, casinos and games, intended to disseminate global consumerist goods within the Romanian urban society. The social function of malls in the built-up area is visible in the number of visitors to the eleven Bucharest malls. On the other hand, building some of these commercial centres implies special works to improve the infrastructure, e.g. the construction of Trident Plaza in Constanţa requires the consolidation of the city’s sea cliffs area; other special works imply Figure 2. Location of the main commercial units in the rehabilitation and integrations of certain historical Bucharest buildings into the respective commercial centres (e.g. the former slaughter-house in Timişoara will became part of the future Civis Center). 4 Conclusion The development and modernisation of trading The main types of location of malls and services is one of the main components of the tertiary hypermarkets in Romania are the following: 1) on the sector in Romania. The process has gained in site of former food complexes that started being built importance after 2000; according to available data before 1990 (mainly in Bucharest) but were later only 6% of the consumer goods were sold through abandoned: Bucharest Mall, Plaza Romania, City store chains in 2000, 27% in 2005 and presumably Mall and Liberty Center. Sheduled to be built in the 50% in 2010. The dynamics of this process is due to unfinished structure of what was be the “Radio Romania ranking 8 on the preferential trade list of House” is Dâmboviţa Center; 2) on the site of investors, Russia and the Czech Republic heading the dismantled industrial units: AFI Cotroceni (UMEB list. At the same time, the globalising character of this Plant); Sema Park (Semǎnǎtoarea Plant); Atrium process is given by the specific consumer goods found Center Cluj-Napoca (Someşul Knitwear Mills); in commercial centres and by the fact that over 90% Craiova Mall (IRA Factory); Plaza Center Timişoara of the modern trade network belongs to international (Modern Footwear Factory); Civis Center Timişoara store chains. (formerly a slanghter house); Korona Braşov (Fartec 3.4. The Economic-Financial Crisis and the Factory); Gold Plaza Baia Mare or Cora Lujerului in Commercial Investments Bucharest (demolished dairy products factories); The economic-financial crisis has a powerful 3) on the major highways, at the city margin: impact on trade investments, the market being Commercial Park Bǎneasa, on DN 1 Bucharest- oversaturated and people’s purchasing power fairly Ploieşti, Militari Commercial Park on A1 Bucharest- low, especially in Bucharest. Thus, ashortage of Piteşti, Dragonul Roşu on Bucharest-Urziceni investors made some projects be abandoned (Oltenia Highway; Euromall Piteşti on A1 Piteşti-Bucharest; Mall in Craiova, Galleria in Bucharest, Siret Plaza in Şelimbǎr-Sibiu Commercial Park on the highway to Galaţi, Three Galleria in Buzǎu etc.), postponed or Timişoara; Constanţa South-Agigea, on the road to their destination changed to offices buildings, e.g. Axa Mangalia; West Gate and Oltenia Mall in Craiova on Shopping Center in Iaşi, while some hypermarkets the roads to Filiaşi and Malu Mare, respectively; Perla (Pic in Brǎila, Oradea and Cǎlǎraşi, Spar in Târgu Shopping Centre in Ploieşti on DN1; Galleria in

ISSN: 1792-5983 31 ISBN: 978-960-474-240-0 Proceedings of the 5th WSEAS International Conference on Economy and Management Transformation (Volume I)

Suceava on the road to Fǎlticeni; Plaza Center in 7) in central areas, using local urban polarising nuclei: Timişoara on the road to Lugoj; Plaza Center in Alba Mall in Alba Iulia, Bistriţa Mall in Bistriţa, Hunedoara on the road to Deva; Silver Mall in Vaslui, Forum Center in Piatra Neamţ, Grand Mall and in the north of the town, on the road to Iaşi, etc.; 4) on Atrium Center in Satu Mare, Aktiv Plaza in Zalǎu, the outskirts of towns, on the road to tourist zones: Winmarkt Central Mall in Vaslui, River Plaza in Eliana Mall in Braşov, on the road to Bran-Moeciu, Râmnicu Vâlcea, Grand Center in Sinaia; 8) on the and Mega Mall on the road to Predeal; City Park Mall site of universal stores overhauled and turned into in Constanţa in Tǎbǎcǎriei district, on the road to malls: Unirea Shopping Center in Bucharest, Tomis Mamaia sea-side resort, etc.; 5) in the proximity of Mall in Constanţa, Mureş Mall in Târgu Mureş, student campuses: Iulius Mall in Cluj-Napoca, Iulius Moldova Mall in Iaşi, Winmarkt Shopping Centre in Mall in Iaşi, Crizantema Mall in Târgovişte, Galaţi, Maramureş Shopping Center in Baia Mare Carrefour Orhideea in Bucharest, etc.; 6) on the site etc.; 9) in the proximity of parks associated with of former stadiums: Mercury in Arad (Strungul recreation and other functions (trade, business): Park Stadium); Lake Plaza under construction near Titan Park, or Galleria Bucharest (still a project because no investors have come forward) in Plumbuita Park.

References: [1] Săgeată, Radu, Globalizare culturală şi cultură [5] Roşu Simona, “AFI Palace Cotroceni şi Mega globală. Global şi local în geografia culturală, Mall va fi inaugurat cu trei luni mai devreme” in Editura Universitară, 2009. Capital, May 6, 2009 [2] Săgeată, Radu, Guran, Lliliana, “Serviciile bancare [6] http://www.sunplaza.ro în oraşele româneşti. Analiză teritorială”, in [7] Săgeată, Radu, “The Recent Development of Historia Urbana, T. XV, No. 1-2, 2007, p. 73-86. Com-mercial Services in the Context of [3] http: //www.bucurestimall.com.ro Globalization. Case Study: Bucharest”, in Human [4] http://www.afi cotroceni. ro/afipalace Geographies. Journal of Studies and Reseach in Human Geography, Vol. 2, Issue 2, 2008, p. 73- 88

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