"Yields compression released a number of land projects on the Romanian market".

Alan Cartlidge

The property markets of Romania and Bulgaria have a new buzz-word: regional shopping malls. The second largest market in terms of population in CEE, Romania, is two-three years ahead of its neighboring country regarding retail property development, but the segment has also gained speed in Bulgaria where most of the principal cities have already been supplied with one or more shopping center projects. And this is only a small part of the dynamic real estate activity currently going on within the region.

Looking for credible information about one of Europe’s hottest markets, Property Xpress invited for an interview Alan Cartlidge, Investment Manager with Charlemagne Capital Limited, responsible for the management of property investments in Bulgaria and Croatia and for the identification and procurement of new projects throughout the Central and Eastern European region. Alexander Tsachev, also Investment Manager with Charlemagne Capital, jointed us, sharing his professional opinion about the property lending arena in this part of Europe and the company’s investment strategy.

Currently managing two funds for property investments in the region, European Convergence Property Company (ECPC) and European Convergence Development Company (ECDC), Charlemagne is actively taking advantage of the flourishing real estate sector in the Balkans. The Investment Manager has already developed a substantial amount of expertise in investments in income-generating assets through ECPC and is now exploring development projects opportunities in Romania and Bulgaria through ECDC, its new vehicle.

What is that prompted Charlemagne’s decision to establish ECDC? Why has the company decided to concentrate on retail development in Bulgaria and on office and residential projects in Romania? When a balance between the growth in the purchasing power of the Bulgarian population and the rise in the number of shopping-malls in the country will be struck? How many shopping centers are the regional cities in Bulgaria able to accommodate? What is that fuels the confidence of banks in the region’s real estate industry thus making them more aggressive in financing leveraged property projects? Is the risk associated with exit from property assets in the region greater than a few years ago? Why committing capital to real estate projects in SEE is not easier than it was before?
The reflections of Charlemagne’s Alan Cartlidge and Alexander Tsachev on all the above issues are available in this interview.

We have also talked about: How does yields compression actually sell and can favorable interest rates in Bulgaria and Romania compensate for its effects? Are the retail property markets of the two countries overheated? Are there overpriced real estate projects in terms of sale prices? What is happening in the office markets of Romania and Bulgaria? Can a softening in office space rental levels be expected? How is the Rousse shopping-mall project advancing? Is ECDC considering large mixed-use developments and vacation investments? What is the plan for Turkey?

The rest of this interview is for Property Xpress subscribers only.
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