CEDER 2023 in review: Upcoming correction and discrepancy between products
Laurențiu Lazăr, Managing Partner and Head of Investment at Colliers, Romania: “I do believe that we will see a correction [...], like [a] 50% decrease”.
The market presentation CBRE held at CEDER 2023 showed that, for the moment, amidst a period of great economic uncertainty, Romania is faring better than other European countries. The presenters pointed out that, similarly to the previous economic crisis, a certain latency can be observed between what is happening globally and what is happening in the Eastern European country. Romania has also proven to be more resilient, meaning that the market moves slower on the downturns, but also on the way back up.
During the Office Panel held after the market presentation, Laurențiu Lazăr confirmed that in Q1 2023, the investment volume in Romania, although still low, had increased by 40% compared to 2022, and 20% compared to 2021. However, he stated that he expected to see “a correction from 1.2 billion from last year, which was the second-best year ever, to 600 million this year. So, like 50% decrease.” The expert went on to predict that the following 3 to 4 months would help better establish where the market stands. He also expressed his firm belief that there is “a big discrepancy between [good] products and the ones which are not so good” in terms of location, building quality and ESG considerations. He concluded: “If you have a good product, it's there. If not, if you can wait, because it's not the right moment to sell, you will simply [not] sell or you have to put a very low price.”
On the same topic of investments, Codrin Matei, Principal Partner at Crosspoint Real Estate, said that “a lot of high-net-worth individuals [...] have an excess of liquidity and they're somehow pushed by the high inflation to make investments.” He specified that current investments are aimed at specific products “that tick all the investment boxes”. He also mentioned that, if in the past having tech companies as tenants was a big plus, investors now look to other industries as well, such as healthcare or energy.