How half of apartment projects announced in western Bucharest were frozen

Of the 1,500 new housing units announced in Drumul Taberei-Militari area of western Bucharest, more than half have already been put on hold. Sunset Residences was first, then came Infinity Residence, Primavara Lujerului or Dimri Ghencea. Which are next?

The prices of old apartments in Drumul Taberei or Militari, two of the biggest districts of Bucharest covering almost the entire western part of the city, dropped below 1,000 euros/square metre, so that a three-room apartment has come to cost around 70,000 euros, reads Business Construct magazine, which comes out together with Ziarul Financiar later this week. The trend was followed relatively fast by firms that built new apartments in this area, with prices starting from around 900 euros/built square metre for finished apartments in Primavara Ghencea or Ten Blocks. Still, these prices are not making buyers queue up, either. Thus, the initial plans of companies that bought land to build thousands of housing units have been upset. The solution for most of them: to freeze the projects. “(…) According to contract terms, we have the right to have delays, but we’ll have to pay rents during this interval,” says Eduard Sotski, CEO of Tehnogrup, which announced an over 2,000 housing unit-project in Drumul Taberei, Infinity Residences. Without sales revenues, instalments for the loan contracted from UniCredit are paid by shareholders, Afik Israeli firm. The first negative news for Drumul Taberei complexes came last November, when Sunset Residences’ showroom was closed and construction works halted. Many developers’ hopes are linked during this period to “Prima casa” (“First home”) programme, as most buyers are finding it hard to contract mortgages during this period. Some delays are likely to amount to several months, in the context where works will be resumed by the end of this year, as the plan is in the case of Primavara Lujerului, too. Many other plots of land in western Bucharest are currently blocked, as owners are reluctant to start construction work until the market stabilises. So far, around 1,000 new apartments have been finalised in western Bucharest. Part of these have been delivered to buyers, while others have not found buyers and some are about to be delivered.