The latest online panel discussion of Property Forum focused on the effects of the COVID-19 lockdown on the Romanian property industry. The experts discussed, with the moderation of Răzvan Gheorghiu-Testa FRICS, Partner and Co-Head of Real Estate Practice Group at Ţuca Zbârcea & Asociaţii, how governmental measures affect the market and how different asset classes are impacted by the crisis.
The lockdown impacts the subsectors of the real estate industry differently. Generally, everything goes in a business as usual way in the industrial sector and there are no significant changes. In the office sector, however, the adoption of new mechanisms is needed and property managers have to find solutions by developing business continuity plans, explained Alexandru Atanasiu, Associate Director at Colliers International.
The logistics sector is doing well in Romania, only small changes of the operation, such as increased sanitary measures, have been implemented, added Muler Onofrei, CEO & Co-Founder of Element Industrial. The fact, that no requests for rent reduction have been made in the sector, gives a reason to be cautiously optimistic,
David Hay, Founder and CEO at ADD Value Management, pointed out that on the office market there are also not many requests for rent reduction. It shows that the market is still doing quite well, only the mode of operation has changed. Property managers have to deal with empty buildings, on average now there are 30-40 people in the building out of 1000 people normally. However, it is still very early to see the long-term results of the lockdown, he added.
Mihai Paduroiu, CEO Office Divison at One United Properties emphasized the changed preferences of the key players of the market. People pay more attention to quality and new factors come into attention, such as the size of the floors per working place and enhanced sanitary standards.
Concerning the new measures announced by the state, Ana Dumitrache, Country Head Romania at CTP drew attention to the discrepancies between the political statements of decision-makers and the reality of the implementation of these promises. The system is not prepared to implement many measures as fiscal authorities often struggle with the execution of them. Although the lockdown will probably be over soon, how the situation will look after that is very unpredictable.
Forced measures directed from above may not help the situation. A lot of opportunistic approaches get a chance to play out the current situation, commented Victor Constantinescu, Managing Partner, Romania & Co-Head of Real Estate at Kinstellar.
