Why invest in Bucharest? (Capital city)

High unsatisfied demand for residential properties;(estimates of 300,000 units in demand and only 1,800 units delivered in 2007)
Local migration to Bucharest for the better-paid jobs (adds more pressure to the residential/rental demand).
Major Multinationals (Microsoft, IKEA,etc) establish headquarters in Bucharest (creates a demand for business rental)
Prices on new build are still cheaper than the old communist flats; SEE MARKET ANALYSIS BELOW
Major investments in the infrastructure (Romania will receive €30billion EU funding between 2007-2012)
Low cost carriers flights are available from major UK airports (Easyjet, Ryanair)
Why invest in "La Cittadella"?

Excellent payment plan (as little as 10% initial capital requirement)
Exit plan (re-sell opportunities through our Romanian company before or after completion)
Brilliantly located near a developed area of Bucharest with existing infrastructure
Excellent transport links underground station, main bus links, easy car access to both central city and the motorway network
City High Speed motorway 1.5 miles to the new system(work started already)
Proximity to major employment opportunities ensures rental income
Major retail and leisure facilities close by(2-3 miles radius)
Recreational areas in close proximity(forest and lake areas within 1mile radius)
Cittadella is being developed by a partnership of Romanian companies, including a prestigious bank, all of them with a good track records and extensive local market experience. The project is being sold by the developer directly to clients with no middleman involved. This is an incredible investment, with a finance plan designed for high capital gain.

Payment Plan

10% -Initial payment - as soon as you sign
20% -Structural work completed - September 08
70% -Completion (mortgage) - September 09
Facilities within the Development

Small shops within the development (mini-market and bank)
Overground and underground parking (€9,000/€14,500)
Case Study- Local Market Analysis – Militari area Bucharest (Communist era flats v New build)

1)Pricing of existing communist era flats A two bedroom apartment (equivalent to 3 rooms in Romania) average price in the Militari area is €135,000 for a 75sq metre net area (including balcony). So they can be compared with the new build, the above price needs to be transformed into €/ sq metre built +Vat. After the calculations, the equivalent of the above price is aprox.: €1350sq metre + VAT.

Q: How was the average price obtained?
A: average price taken from www.anuntul.ro (main property search engine in Romania)
2) Pricing opportunities “ La Cittadella” (VAT = 19%)

Development = 110 flats/houses

Phase 1 first 20 units @ € 1,100 per sq metre built +Vat
Phase 2 next 15 units @ € 1,200 per sq metre built +Vat
Phase 3 next 15 units @ € 1,300 per sq metre built +Vat
Phase 4 last 60 units @ € 1,500 - 1,700 sq metre built +Vat
Q: Why is the property cheaper at the start of the development and then it goes up in value?
A: As a developer, in order to get a better deal with the financing bank, we need to have a certain level of interest in the early stages of the project. Because of that, the first few apartments we sell almost at cost. To ensure our profitability, we increase the price towards the completion of the development, when it can easily be absorbed by the local demand.
Case Study Conclusions

Our apartments are currently 18.6% cheaper than the thirty year old, dilapidated communist era properties. Because you initially invest only 10% deposit, this means you may have a186% return on your investment right from the beginning, subject to market conditions. This will give you good start in developing your capital gain expectations.

Note: Even if you achieve this good start, it is very difficult to sell these contracts straight away because you compete with us, the developer, in selling the apartments. However, towards the end of the development, when we finish selling, we would be interested in finding clients for your properties and in this way help your ‘exit’ strategy.

Q&A Section:

Q) Can we offer a rental service?
A) We will once the development is completed.


Q) What is the rental yield in Militari area, Bucharest?
A): A Communist two bedroom apartment is currently renting for €500-€700 per month. “La Cittadella” would probably, pessimistically, achieve €700-€750 per month. In other words, assuming that you had your property completed at this moment in time, you could achieve a rental yield of 6.5% which would have covered the cost of your mortgage.


Q) Guaranteed rental income?
A) Guaranteed rental normally applies to holiday resorts where income from travel companies can be taken into account. This is not the case in an urban situation in Romania


Q) Where can you meet us?
A) You can either meet our knowledgeable team based in our London office or meet our colleagues in Romania. We organise supported visits to Romania for prospective clients. Contact us for more details