Cordia, part of global developer and investor Futureal Group, is a leading European residential development company headquartered in Hungary. In Romania they are known for projects such as Parcului20, and Europe wide they have over 3,700 homes under construction.
You’ve been the head of Cordia Romania & Spain for five years now – tell us a bit about what you envision for Cordia on the Romanian market?
Cordia is a real estate developer and investor, the largest in Hungary and benefitting from a strong presence in Poland & Romania. We also hold operating assets across Germany, Spain, and more recently in the UK through the acquisition of the Birmingham-based PRS(Private Rental Sector) specialist developer Blackswan Property, now Cordia Blackswan.
Our group is expanding to become one of the largest developers in Europe. Our ambition for Romania is to build 2,000 apartments in the coming years. We are already working on the second phase of the Parcului20 residential project, comprising 220 apartments. The first phase was finalized and residents started moving into their new apartments in March 2021. In Parcului20, we are delivering 485 apartments in one of Bucharest’s most flourishing, up and coming areas. We’re focusing on the medium-high segment of residential estates in the central & northern part of Bucharest, with the aim of contributing to the area’s urban revitalization.
Any particular reason for focusing on Bucharest, are you also considering the up and coming secondary markets?
Building a team in a new location is always more difficult than improving the one you already established. We have good people in place and will be focusing on Bucharest for a couple of years to come until we reach our target of developing 500 apartments/year on a regular, steady basis, at which point we will set our sights on expanding. Bucharest is very attractive in terms of number of inhabitants and market liquidity. We understand the dynamic pace and lifestyle of the city and believe our business can thrive here.
How has the pandemic affected your business in Romania, in light of people’s reprioritization of their living spaces?
The residential segment at large has been less affected by the pandemic in comparison to office & retail, or even positively affected actually. Our sales specifically have not been influenced by the pandemic, neither negatively nor positively. Of course, sales dropped during lockdown, but as soon as the lockdown was lifted, we had a surge in numbers that stabilized so that we were able to bring our business plan to fruition. We are grateful to be able to keep up with the times and not suffer losses.
Demand has indeed shifted, in the sense that people started paying more attention to the concept & architecture of individual apartments, prioritizing natural light and optimal compartmentalizing in order to maximize the functionality of the living space, as well as the aesthetic value. Another noticeable trend during the pandemic was the shift of residential buyers’ focus to less crowded areas, outside the city center.
This fit in very well with our business model, as we already prioritized attractive sites, surrounded by green spaces. Location will always remain such a crucial part of a developer’s decision-making process and can make or break a project,
Are you noticing the build-to-rent model that has grown so popular in the West also taking shape on the Romanian market?
Countries with Latin roots have property ownership in our cultural DNA. Romania particularly is a country where the home ownership rate is over 90%. But, yes, this is changing. Younger generations appreciate mobility, they’re a lot more flexible and see no advantage to owning a property. Thus far the rental market has been dominated by individual owners but it is also getting corporate, which should help with the level of quality and standardization. This is a niche market with a lot of potential for growth in Romania.
Being a developer is not always a walk in the park – what are the main challenges you have been facing on the local market?
There is a need for greater transparency, simplified procedures and decreased bureaucracy. Digitalization is the most obvious answer. The process has already started, for instance you can request some documents electronically, but there is a long way to go. Developers are facing issues with obtaining authorization, connection to utilities, and materials price fluctuations.
On this note how did you manage the unprecedented increase in the price of materials?
With quality human resources, goodwill and a proactive spirit.
What are your main objectives for Cordia in Romania for the coming two to three years?
Our plan is to reach a development rate of 500 apartments per year in various locations across Bucharest. We are in the process of acquiring land to consolidate our business and strengthen the pipeline. There is an exciting project in the works in the Coralilor area, North Bucharest where we intend to develop 700 apartments.
Do you have a final message for international investors eyeing Romania’s residential segment?
It is important to have patience, find the right professionals and collaborators, and then everything is possible. Romania is a country that has a lot to offer, it’s constantly developing and has a very bright future.
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