ING RED: Real estate benefits from credit crunch

ING Real Estate Development (ING RED), the real estate development division of the Dutch group ING – a giant on real estate markets, targets investments worth at least 600 million euros in Romania, and views the financial shock caused by the subprime mortgage crisis as positive for large investors, especially as a result of speculators exiting and moving further East. “The local market needed the credit crisis to show investors that ‘the sky is not the limit’ in real estate,” Siep Hoeskma, country manager of ING RED told ZF. The manager, who, until November last year, worked at the company’s London office, says the company that he runs entered the market at the right time, and intends to invest at least 5% of ING RED’s 12 billion-euro (i.e. around 600 million euros) in Romania. The portfolio is expected to include residential spaces (40%), retail spaces (40%), whilst the rest will be distributed to logistic and office developments, depending on the market opportunities. “We are looking mainly outside Bucharest, because prices are more realistic on the provincial market. We have two projects outside Bucharest, which we could start this year, a commercial one and a residential one (which will also include retail spaces), which will entail a cumulated investment worth 60 million euros,” ING RED’s manager specified. Dutch group ING is also present with its investment division on the local market, which last year made its first acquisition in Romania, when it purchased the shopping gallery at Felicia Shopping Center (photo) in Iasi, for 40 million euros.