NEPI Rockcastle announces over €650 million budget for developments

NEPI Rockcastle, a developer and manager of shopping centres in Central and Eastern Europe, announced a significant budget dedicated to projects in the medium-term development or refurbishment phase. The company will allocate more than €650 million to construction and refurbishment work, making it the largest investment programme in commercial retail in Central and Eastern Europe.

"NEPI Rockcastle is currently carefully adapting its portfolio of projects under development to meet the high demand for commercial space that we have seen in Central and Eastern Europe, both from international and local retailers and from other sectors such as entertainment or HoReCa.

I also noticed this trend during this year's MIPIM, the largest global real estate event, where I had the opportunity to talk to many major industry players, potential partners or investors of NEPI Rockcastle in our portfolio growth journey. I believe that our expansion in the Central and Eastern Europe region is a necessity, as there is remarkable potential here: unlike Western Europe, the amount of commercial space is still too small in relation to demand, and the economies in the region are growing strongly. This is why we have calibrated our development strategy, starting with the property acquisitions we made at the end of 2022 and continuing with major developments and projects in 2023, as well as adapting our investment programme. We expect the current portfolio of projects under development to deliver returns from 2027," said Rüdiger Dany, CEO of NEPI Rockcastle.

NEPI Rockcastle has a portfolio of 168,800 sqm of projects under construction or modernisation, already started or planned for 2024, in Romania, Poland, Bulgaria and Hungary. The most important are:

- Promenada Mall expansion, Bucharest, Romania - a mixed-use project worth approximately €282 million, with a surface area of 55,400 sqm, scheduled for completion at the end of 2026. The project is extensive and involves the excavation of the deepest building basement in Central and Eastern Europe at 26 metres, where a 2,400-space car park will be built on six levels.
- Development of Galati Retail Park, Romania - the project will cover 33,200 sqm and the investment will amount to €48 million.

- Promenada Plovdiv development, Bulgaria - the new shopping centre will occupy 60,500 sqm, will generate around 1,500 jobs and the investment amounts to €173 million. The project is in the permitting process and is scheduled to open in 2026. Promenada Plovdiv will be the company's third investment in Bulgaria, alongside Serdika Center and Paradise Center in Sofia. With the opening of the future shopping centre, Bulgaria will become the third largest market in NEPI Rockcastle's portfolio by gross lettable area (GLA) and asset value, behind Romania and Poland and ahead of Hungary.
- Bonarka City Center Mall upgrade, Krakow, Poland - €79 million project, including an architectural redesign to add 4,700 sqm to the original 76,300 sqm.

- Modernisation of Arena Mall, Budapest, Hungary - a €31 million project with a five-year duration.
- Other projects: extension of Ploiesti Shopping City, Romania - the project involves adding 7,400 sqm; extension of Wolomin Gallery by 2,800 sqm and Pogoria Shopping Centre in Dabrowa Gornicza by 4,800 sqm, both in Poland. The investments amount to a total value of €39 million.

NEPI Rockcastle also plans to expand its successful pilot project, which involved the installation of substantial photovoltaic panels across its portfolio of properties in Romania, in 2022 and 2023. As such, these installations currently produce 25% of the total energy needs of the Romanian portfolio. The installation of the PV panels has proven to be a project that not only aligns with the group's sustainability strategy, but also has a positive operational impact.