Cătălin Năstăsoiu, Vice President of Marketing Strategy at Genesis Property, spoke with Property Forum about the status of the YUNITY Park development in Bucharest and the outlook for the office market amidst the limited volume of new deliveries coupled with rising rents.
This interview was first published in Property Forum’s annual listing of "The 50 most influential people in Romania’s real estate market”.
How did Genesis Property’s operations evolve in 2023 and what are your objectives for 2024?
A particular achievement in the previous year was the completion of the second phase of the YUNITY Park development, a significant investment of €20 million. This phase was marked by the redesign of the campus’ public space as a natural extension of the office, with a focus on social interaction, connection to nature and long-term sustainability.
Today, YUNITY Park represents an innovative mix of experiences, including an urban forest, an outdoor amphitheatre, and flexible workspaces tailored to the needs and lifestyles of Generation Z and future employees. In 2024, we aim to continue to provide great experiences for both employees and businesses in YUNITY Park and the West Gate Business District. Our priority is to complete the third phase of the YUNITY Park development, continuing to anticipate the needs of the future that include commitments to our ambitious sustainability goals.
We are proud to be the first real estate company in Romania to join the UN Global Compact alliance, demonstrating our firm commitment to social and environmental responsibility. In addition, we are determined to reduce carbon emissions for our entire building portfolio at a pace scientifically validated by SBTi that contributes to achieving the goal set by the Paris Agreement – limiting global warming to 1.5 degrees Celsius above pre-industrial levels by 2050.
Cătălin Năstăsoiu
VP, Marketing Strategy
Genesis Property
What is the occupancy in your office portfolio and which industries have the highest share in the tenant structure?
In our two office parks, YUNITY Park and West Gate Business District, the leasable space is fully occupied. Interest in our spaces remains high because people’s and companies’ need for modern office space has remained greater than the existing supply in the market. Further evidence of this is the fact that over the past year we have had 5–7-year lease extensions with most major tenants. Thus, in the last 12 months, well-known companies such as HP Inc., Garanti BBVA, Siemens and Ericsson have renewed their commitments, bringing Genesis Property’s total leased area to over 25,000 sqm. Our tenants come from a wide range of industries, be it IT&C, finance-banking, technology or manufacturing.
In addition, office space is also occupied by companies such as Accenture, Luxoft, Yokogawa and Alpha Bank.
Have you noticed any changes in demand for office space over the last 12 months?
There have been changes in demand not only in the last 12 months but also in the last 3 years, depending on the segment and the quality of the offices. Thus, demand for class B and below offices in hard-to-reach areas has decreased. On the other hand, the area in which Genesis Property operates, that of modern, class-A offices located in Bucharest, is experiencing an increase in demand. Companies are looking for workspaces that clearly meet the requirements of their teams. Employees articulate the need for working environments that offer the best possible conditions, including dedicated areas for socialising, generous green spaces and a variety of leisure options.
These are the elements Genesis Property currently offers in its office parks, most notably in YUNITY Park, a business campus designed for the future needs of employees.
How aware are tenant companies of the ESG aspects of office buildings?
We are aware that climate change has become one of the biggest threats of our time, with far-reaching implications for the real estate industry. A prime example of our determination to pay attention to ESG criteria is the transformation of a car park into a park where the urban forest plays a central role in improving both the environment and the lives of people working in the tenant companies. We work in partnership with our customers and the communities we are part of to improve the local environment, from volunteering and supporting environmental projects to facilitating greener transport operations such as cycling and electric vehicles.
At Genesis Property, we are committed to voluntarily and transparently providing information about our activities through an annual report called ”Progress Communication”, a document produced in accordance with the UN Global Compact reporting framework. This commitment demonstrates our understanding of the essential role that transparency and open communication play in our shared effort to create a sustainable world.
How do the companies in Genesis Property’s tenant portfolio manage their work systems? Does hybrid working prevail?
The hybrid model, with the office at the centre, has been the predominant way of working in the last year, for at least two reasons. Firstly, it gives employees a better work-life balance, but also more flexibility to deal with personal issues without affecting their career development. Secondly, the hybrid system also helps companies, which can offer this benefit to employees to achieve more cohesion and efficiency in the way teams are organised.
What is the outlook for office rents in the Bucharest market?
Modern and well-equipped office spaces will continue to be highly sought after by companies that want to offer their employees the best conditions for professional and personal development. Spaces for relaxation, outdoor movement and socialising have become necessary conditions required by most employees, especially if we are talking about Gen Z.
As the supply of such spaces continues to be lower than the demand, and the number of new projects to be completed is also decreasing, we can expect a continuation of last year’s trend of increasing rents. We expect both occupancy and take-up rates to continue to fall, and this will also have a direct impact on rents.
What impact will the lack of large new projects have on the office market?
The gap between the demand for modern office space and the existing supply in the market will continue to grow as the number of new projects is reduced. Even as hybrid working becomes more prevalent and remote working could increase in the absence of adequate workspace, we expect pressure on rents to increase this year.
Are you exploring new investments in the Bucharest market or regionally?
We are always looking for new investment opportunities in Bucharest, because the market here has a huge potential for development, not yet developed. Currently, our priority is to complete the third phase of YUNITY Park and continue investing in the West Gate Business District. We offer high-quality spaces and services to our partners, and every year we allocate significant budgets for new investments.
