The yields of the properties in Bucharest will decline gradually in the future, Friedrich Wachernig, a board member of Austrian real estate developer S Immo, said. Thus, if “prime” office buildings were sold last year at yields of 7.25-7.50%, he expects the yields to fall to 7% this year and further down in the coming period.

“When the economy and politicians will demonstrate that it is a stable market with growth potential, then the yields will shrink. At this point, this is the trend on the market. For core office or retail buildings, we expect returns below 7%. It will take a while, but there is much money in the market now, and I am optimistic that this year Romania will continue the transition to the Western European yield level,” Friedrich Wachernig explained, according to local Ziarul Financiar.

He pointed out that S Immo continues to analyze the local market and is looking for new land for office developments as well as ready-made offices.

“We would like to invest more in Bucharest, buy land to develop new office projects, or buy existing properties if they are in good locations. We are currently in such discussions for the acquisition of new land in Bucharest,” Friedrich Wachernig said.

He added that he is interested in land sold by municipalities if such opportunities exist.

editor@romania-insider.com

(Photo source: the company)