EMEA Office Fit Out Cost Guide 2024
Bucharest, July 2020: Calea Victoriei in Bucharest, the 2.8-kilometer-long artery between Piața Victoriei and Piața Națiunilor Unite, will continue to grow as an office and hotel hub in the upcoming years, with developers planning to build seven new office buildings and six hotels as the total investment could exceed the 300 million euros threshold, according to an analysis of the Cushman & Wakefield Echinox real estate consulting company.
The new office buildings will provide a gross leasable area (GLA) of over 100,000 square meters, and the hotels would also add over 700 rooms rated at four and five stars to the existing offer. Currently, there are 12 office buildings with a GLA of about 55,000 square meters in the Calea Victoriei area, representing less than 2% of the Bucharest modern office stock . Regarding the hospitality offer, the area is the most developed one in the capital city of Romania, with over 2,000 rooms in four and five stars rated hotels, representing about 30% of the city’s accommodation capacity in this high-end segment.
The most advanced projects are the Autograph by Marriott Old Town hotel, which will have 214 rooms, and Millo Offices, Tandem Offices and Dacia One, three office projects with a leasable area of about 40,000 square meters.
In regards to the investment volume, if we take into account the cost of land, which is among the most expensive in Bucharest, it can be estimated at over 2,000 euros / sq m of office GLA and between 100,000 and 150,000 euros for every four or five stars hotel room. Thus, the development value of the proposed office buildings can be estimated at over 200 million euros, while hotels could attract an investment budget between 75 and 110 million euros.
The most recently completed projects in this area are the Moxy Old Town Hotel on Doamnei Street, with 119 rooms, and the Victoriei 109 and Mendeleev Office 5 office buildings with a total GLA of over 10,000 square meters.
Calea Victoriei is considered the most representative high-street location in Bucharest, attracting a series of premium and luxury fashion brands, such as COS, Hugo Boss or Gucci, having recently become an area for promenade, especially in the evenings and on weekends, when people can have a better and more relaxed view at the dozens of palaces and representative buildings that host museums, cultural spaces or public institutions. In addition, Calea Victoriei is an important destination in terms of restaurants, bars and cafes located in the Amzei – Romanian Athenaeum or Lipscani – Smârdan (Old City) areas.
Mihnea Şerbănescu, General Manager, Cushman & Wakefield Echinox: “Calea Victoriei is a major artery around which the reconstruction of Bucharest can be restarted, considering that the area includes a series of the most important Romanian architectural jewels, which must be preserved and capitalized on, but also many buildings left in ruins, that require substantial consolidation or redevelopment investments. We are glad to see an increasing number of developers eager to materialize the area potential, by investing both in the refurbishment of historic buildings and in new premises that fit into the specific architectural norms. With a critical mass of modern office spaces and accommodation facilities and a variety of gastronomic and cultural attractions, Calea Victoriei can once again become a top European touristic and business destination.”
Measures we believe the authorities should take to contribute to the development of the area:
- Construction of an underground car parking in Piața Revoluției
- Improvement and revaluation of the green spaces around Sala Palatului
- Clarification regarding the authorization process in order to provide more predictability
- Acceleration of the public buildings refurbishment and consolidation processes
- Creation of financing programs and the enforcement of coercive measures aimed at the owners of degraded buildings
Cushman & Wakefield Echinox, the exclusive affiliate of Cushman & Wakefield in Romania, owned and operated independently, has a team of over 60 professionals and collaborators offering a full range of services to investors, developers, owners and tenants. For more information, visit www.cwechinox.com
Cushman & Wakefield, one of the global leaders in commercial real estate services, with 53,000 employees in over 60 countries and € 8.8 billion in revenue, provides asset and investment management consulting services, capital markets, leasing, administration properties, tenant representation, design and evaluation services. For more information, visit www.cwechinox.com
