The next three years (2018-2020) will bring a DOUBLE of class A office spaces for the office market in the CENTRAL WEST area (Grozavesti – Politehnica- Vasile Milea – Academiei-Tudor Vladimirescu).
The residential segment is experiencing accelerated development in the west. If between 2014-2017 an average of 1.050 units/year were built, for 2018 and 2019, 2.000 units/year are announced.
Center – West benefits from important anchors in the commercial area such as the AFI Cotroceni and Plaza Romania malls – and the Carrefour Orhideea and Vulcan Value Center shopping galleries.
More than 35.000 corporate members are expected in the Politehnica-Grozavesti-Orhideelor-Tudor Vladimirescu area offices in the next three years. Where large tenants as BCR, Bitdefender, IBM, DELL Secure Works, Schlumberger, Temenos, Misys announced signing pre-lease agreements, this will train and sustains in cascade the development of both residential spaces, as well as the commercial ones.
In the next three years (2018-2020), 279.000 sqm of offices will be delivered, compared to the 286.000 sqm that were developed in all the previous 17 years (2000-2017). One calendar year – 2018 – will total record deliveries, 160.000 sqm, an area equal to the total post-crisis deliveries (2014-2017). At the end of 2020, class A office stock in the center-west area will be over half a million sqm (565.000 sqm according to the planned and announced deliveries so far).
Why are corporatists moving in the WEST CENTER area?
First, due to the proximity of Politehnica BucharestUniversity,with approximately 20.000 students and Regie Campus, with 27 student dormitories and 13.000 places occupied by future employees in corporations. At a time when companies rent 35-40% of office buildings in the IT&C, BPO, Call Center, Shared Services field, for which the recruitment of young staff with technical and linguistic skills becomes a challenge, choosing office spaces close to the place where these young people study and live is essential.
Second, the proximity to the city center: only 10 minutes by car to any of the main markets of Bucharest – Unirii, Universitatii, Romana si Victoriei, increases the center-west attractiveness area.
And the exceptional accessibility to the subway weighs a lot. Two crucial buses are already present, and the third is in an advanced stage of work. The passengers’ flow will be taken over by the six important metro stations: Grozavesti, Politehnica, Petrache Poenaru, Eroilor, Izvor, and Academia Militara.
And finally,due to the proximity of three of the most densely populated districts in the capital, summing over 925.000 people from official statistics alone. In a Bucharest where employees are becoming more and more dissatisfied with the time spent in traffic – on average reaches over 8 hours/week, at least 45 minutes in the morning and 45 minutes in the evening, bringing offices closer to employees is already a priority for many companies.
1. We believe that now the competition in the working market has become fiercer and the need to recruit young people from the faculty causes companies to come in the middle of the area where most of the candidates are studying or living.
Developers are alsolooking at infrastructure investments. Post-crisis dynamics for both office and residential areas were marked by two major infrastructure projects with a significant impact in the western region: completion in 2011 of the works at BASARAB Passage, and in 2014 of URANUS Boulevard – Stage 1.
After the completion of these large infrastructure projects, three significant acquisitions took place in Bucharest:
In 2011 – VASTINT (IKEA real estate division) buys from Baduc a land of 20.000 sqm, the site on which the Business Garden Bucharest project is currently being developed, which will be delivered in 2018
In 2014 – FORTE PARTNERS buys from HERCESA the 13.000 sqm land on which initiated the construction of The Bridge project
In 2015 – SKANSKA acquires the 21.000 sqm land in Iuliu Maniu 6, where the works for the Campus 6 project started
3.Future investments in infrastructure. Ciurel Passage is in an advanced stage of construction. Also, the works for the largest infrastructure project announced so far by the municipality, namely Splaiul Independence Penetration – Bucharest-Pitesti highway, will have a significant influence in the long-term development of the area and taking over the traffic from Iuliu Maniu Boulevard to the Bucharest-Pitesti highway.
4. And if the classic infrastructure requires a long implementation time, new ways of connecting are implemented faster. With the Campus 6 project, the center-west area will be brought on the I’Velo map, the largest bicycle rental operator.
5.A “cool” pole of new homes
The first major residential projects in the central-western area, with over 100 units, were started in 2013-2014, and the first deliveries of new apartments took place in 2015. At the beginning of 2016, about 1.600 flats were under construction or in the authorization stage. From then until now, the offer of new apartments in the center-west area, completed, under construction or authorization phase exceeds 8.000 units, according to a market analysis by ESOP Consulting l CORFAC International.
The largest residential complexes are in the Politehnica University of Bucharest area: Politehnică Park Residence, 20th Residence, Fabricii 25, Novum Residence, Cotroceni Politehnica Residence, Premium Regie, 21th Residence Politehnica, etc.
The center-west area still offers opportunities for residential development
This autumn, several large land transactions, with residential destinations, were bought by experienced developers in the center-west area. At Sema Parc, the construction of 1.200 apartments will start in the first stage of the Sema City residential project’s development. In the next 4-5 years, it is planned to start the residential component of the mixed project The Light, which will bring another 1.000 apartments on the market.
The premises are favorable for those considering moving west, which is why we believe that in the coming years, for many companies and employees, the direction will be TO THE WEST!
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