Immoeast announced acquisition of shopping centre Polus Centre in Romania with the usable space of 90,000 sqm. Completion of the property is expected in fall 2008 and 40% of the space has already been allocated. Total investment amounts EUR 185m, implying price of EUR 2,055/sqm.
Our view: Romanian markets attracts tremendous amount of money, which led to significant yield contraction over past two years. Nonetheless Romanian market still provides upside potential, which is higher than in CEE countries.
Therefore we see more emphasis on this region as positive also for real estate investors, like Immoeast. Immoeast has already 40 properties there with 2.13m sqm rentable area. The price for the shopping centre is slightly below other Immoeast’s deals in Romania, e.g. EUR 2,100/sqm for the shopping centre in the city of Cluj. We expect the yield to be some 8-8.5%, while in CEE3 capital retail yields are at 5.5-6%.