| "Moscow aside, if you look at central and | | | | billion dollars currently tied only with |
| eastern Europe, Bucharest is probably the | | | | Czech Republic for the number one spot in |
| biggest and most interesting opportunity for | | | | Central & Eastern Europe. Decreasing |
| property investors right now," says Edit | | | | investment rates there and expected |
| Vesser, corporate director for CB Richard | | | | investments in Romania will most likely push |
| Ellis in Bucharest in an article recently | | | | Romania on top.Tesco and Walmart have already |
| published by the esteemed Irish Times.In | | | | announced plans to follow in the footsteps of |
| February 2005, I first alerted readers of | | | | European giant Carefour to enter this |
| Escape Artist to the incredible potential | | | | thriving market.Unemployment here is at just |
| latent in the Eastern European country of | | | | 6%, one of the lowest rates in all of Europe. |
| Romania. Several readers who contacted me | | | | Combined with a low per-head personal debt, |
| purchased land through a realtor that I | | | | more spending cash, and the introduction of |
| advised them of in an area outside of the | | | | credit an amazing new consumer based society |
| city limits of Bucharest at 40 Euro per | | | | is being built.Statistics show that inflation |
| square meter. That land today is now fetching | | | | is low and GDP is high (three times higher in |
| an estimated 200 Euro per square meter.I was | | | | many cases then in Western Europe) in |
| cautioned by colleagues to refrain from | | | | Romania.The vision of the Bucharest |
| quoting the above figures as they seem quite | | | | metropolitan area is quickly becoming a |
| sensational. Indeed, they are representative | | | | reality. Farmland near Bucharest will soon |
| of unique successes and do not represent the | | | | resemble suburban Detroit or Chicago, |
| average gain to be expected on property held | | | | complete with modern family homes, shopping |
| in the Bucharest area for less then one year. | | | | complexes, and modern highways. This |
| However, such gains are possible and it is | | | | phenomenon has already occurred in some areas |
| not uncommon to hear of such success stories | | | | outside of the city limits.2,000 square |
| occurring from transactions made on the | | | | meters plots of land can now be purchased in |
| current market.These exceptional cases serve | | | | the new suburban district of Bucharest for |
| as an indicator of the general trend of rapid | | | | 40,000 Euro (That about $48,000 USD). That' s |
| growth in value of raw land in what is known | | | | about $20 per square meter in a city where |
| as "the new suburbs of Bucharest."The price | | | | downtown prime real estate is going for as |
| of land has gone up by 60-70% over the past | | | | much as $2,000 a square meter and property in |
| several months, due to the high level of | | | | the currently developed suburban region goes |
| demand on the market triggered by the high | | | | for between $150 and $350 a square meter. |
| profitability of investing in land, a report | | | | Between now and the years proceeding the EU |
| by CB Richard Ellis (CBRE) shows.In a | | | | ascension of Romania (analyst predict Romania |
| previous article for Escape Artist ( I | | | | will join in 2007 -2008 and growth will |
| indicated land as potentially the best | | | | continue at impressive rates up to about |
| investment for the average investor in | | | | 2010) property prices in the new suburbs |
| Romania. It poses the least hassles and | | | | should increase at least 30% per year.The key |
| headaches and tends to generate the most | | | | to realizing profit is to buy land in an area |
| profit-growth in the shortest time. The | | | | where developers are looking to build in a |
| verified rate of growth of property values | | | | strategic location, where other like-minded |
| between the time that I made this suggestion | | | | investors have also invested in land. This is |
| to readers and the publication of this | | | | where a reputable estate agency comes into |
| article, given further credibility to my | | | | the picture. As they usually have direct |
| speculations. | | | | relationships with developers and have a keen |
| | | | understanding of where to buy, they more then |
| I am not alone in my view; Razvan Camuescu | | | | earn their 5% or so commissions.New |
| of RHR, a Bucharest property services firm in | | | | structures have now been put in place to |
| his interview for the aforementioned recent | | | | allow foreign investors to invest in land |
| Irish Times article further comments, | | | | without formation of private companies |
| "Outside Bucharest we have seen the price for | | | | (foreign citizens may not own raw land as |
| some land double over the course of two | | | | private individuals) and the process of |
| months." He adds that investments in | | | | forming a company for such a purpose is now a |
| apartments in the center of the city no | | | | relatively expedited one - when you are |
| longer necessarily represent a part of a good | | | | working with someone who knows what they are |
| investment strategy.Yes, all of this growth | | | | doing.Deals most absolutely exist outside of |
| could be considered astronomical, daunting, | | | | Bucharest as well. The long term investor |
| magnificent, maybe even a little scary if not | | | | should also consider naturally stunning land |
| properly managed. This, however, is exactly | | | | located in proximity to up-and-coming ski |
| why Romania has become the next big target of | | | | resorts in Transylvania and incredible |
| the international investor."It is the next | | | | bargains at the excellent vineyards located |
| big location in this part of the world, with | | | | between Bucharest and the aforementioned ski |
| many people looking to get involved here | | | | resorts. These opportunities represent |
| having moved on from Budapest or missed the | | | | excellent investment opportunities but often |
| property train there". "The big guns are | | | | requires a longer "hold time" on the |
| already getting involved alongside the | | | | investment to reap full potential |
| private investors." (source The Irish Times, | | | | returns.More details on those properties, as |
| September 2005)The key to raw land investment | | | | well as on opportunities in Bucharest are |
| in Romania is a) knowing where to invest and | | | | available for readers by contacting me |
| b) when and how to sell. | | | | directly.One final piece of advise - the |
| | | | majority of North American investors who have |
| Bucharest as the capitol of Romania and soon | | | | contacted me come with a sound American |
| EU capitol city is the the star attraction of | | | | mentality related to real estate investment. |
| all Romanian land investment | | | | No doubt, this mentality is tried and proven |
| opportunities.Prices in the downtown area of | | | | in America and represents a very successful |
| the city may have all but peaked after years | | | | model for property investment on that |
| of significant growth but the trend of high | | | | continent. Europe and Eastern Europe in |
| growth in a short-time frame has just begun | | | | particular represent dynamically different |
| in the area outside of the city limits which | | | | markets that require the investor to approach |
| is pegged as the new Bucharest suburban | | | | an investment in this region with an open and |
| district.Bucharest is inhabited by more then | | | | teachable mind.This has caused a much higher |
| 2.5 million people and that number is | | | | success rate among European and International |
| expected by many authorities to more then | | | | investors to date in Romania then for |
| double to over 5 million by 2010 by the rapid | | | | American ones.The tried and true model for |
| development of new housing complexes inside | | | | cashing in on the amazing changing face of |
| of the city and the expansion of city limits | | | | Romania and particularly metropolitan |
| with the introduction of new American-style | | | | Bucharest, tweaked and perfected by |
| suburban living there - now available to the | | | | professionals from the West operating in this |
| average Bucharest-ian who is experiencing | | | | region, has proved to be the best model to |
| higher earning power coupled with increase | | | | follow.Perhaps the Irish Times article, |
| access to credit.Northrop Grumman, the large | | | | summed it up best ".... the key thing is to |
| American construction firm is already in the | | | | have good contacts, local knowledge, and |
| market constructing new homes along with | | | | someone here who you can trust."Romania |
| scores of other European and international | | | | presents the opportunity to make extremely |
| building firms of reputation. As leaders in | | | | profitable investments in a future superstate |
| their industry, they are fully convinced that | | | | of the European Union. It represents the |
| the projections for suburban Bucharest will | | | | transformation of a nation where 30% of the |
| become a current reality.The savvy world | | | | population has never turned on a light, into |
| investor, according to surveys, now | | | | a Western cosmopolitan nation at a maddening |
| identifies Romania as one of the top three | | | | pace. Under control, this chaos can be |
| investment locations in the world (along with | | | | extremely profitable for the savvy |
| China and Brazil) and the number one | | | | investor.Kevin Stillmock has been on the |
| opportunity in Europe. Foreign Direct | | | | ground in Romania advising foreign investors |
| Investment in Romania is at roughly 3.5 | | | | for the better part of a decade. |