Immoeast signed an agreement for 8 to 10 logistics centres to be build in Romania in cooperation with European Future Group (EFG). Total rentable space should reach between 400,000 to 500,000 sqm, with total investment volume of approx. EUR 300m.
Our view: Romanian logistic segment still provides larger yields than office or retail segment. Prime yields for this segment stood at around 8.5% at the end of FY2006 and should decline to 7.0% in 2008 according to DTZ. Although the rents are still on the decline currently around EUR 4.5/sqm/month, the downside seems to be limited and rents could bottom at around EUR 4.0/sqm/month. We see this news as neutral which gives only more light on planned expansion to Romania after SPO process.