Competition may bring rent in shopping centres down by 40-50%

The value of rent in shopping centres could go down by 40-50% over the next few years compared with 2008, due to fiercer competition on the market, believes Luiza Moraru, head of the retail department of real estate consultant CB Richard Ellis-Eurisko. In total, 140 retail projects are now under development in various cities across Romania, 20 of which are in Bucharest and analysts say that not all of them will be successful, and some will not even be completed. “We believe only one project will prevail in each city of more than 100,000 inhabitants (excluding Bucharest), and the rest will be secondary projects. The secondary projects are already witnessing a 10-20% decline in rents and as developers will probably charge 20-50% lower rents, they will have to redo their profit calculations,” Luiza Moraru said during a real estate seminar.