The Spanish company, Hercesa Imobiliare, is planning to build a residential complex on the site of the former Titan bakery, after signing a pre-contract with Loulis Romania for the acquisition of a three-hectare plot. The investment will involve the building of apartment blocks and a commercial area.
Hercesa is one of Spain''s largest real estate firms and has invested some 300 million euros in Portugal alone.
The value of the deal could exceed 4 million euros, while the value of the project itself is likely to reach 40 million euros.
"A pre-contract has been signed and, if things go according to our plans, the Titan complex and the land around it will be sold sometime this year. Our production was entirely relocated to the new commercial complex in Cernica, and since we no longer use this space for production, which is the company''s core activity, we decided to turn it into a special real estate opportunity given its location and the size of the land," said Nikolaus Voudouris, the Loulis Romania chairman.
"Our plans include the development of a residential complex and a commercial area. The built area is likely to reach 90,000 square metres," explained Alejandro Solano, the general manager of Hercesa Imobiliare. He gave no details as to the value of the investment, however at a cost of around 500 euros per built square metre, which is the value estimated by market players, the project could be worth 40-45 million euros.
"The financing will come partly from a contribution by the parent company, while bank financing will also come from Spain. Given the costs in Romania, it is easier for us to use Spanish banks, all the more so since Spanish banks are open to the Romanian market, and many of them are interested in opening branches in Romania," Solano added.
If everything goes as planned, he said, then the approximately 900 apartments for the medium-income category would be ready in two years at most.
The deal for the land is worth more than 4 million euros. The final contract will be signed within a few months, and the final decision as to the construction will be made if the authorities grant the necessary planning permission.
Hercesa is not the only Spanish investor to have announced investment in the real estate sector. Invarsa, a company owned by Spanish businessman Alfonso Cadaval, has acquired land in the centre of Bucharest for almost 10 million euros where they intend to build luxury apartments in a 25-30 million euro project. Invarsa bought an area of almost 200,000 square metres close to the Marriott Hotel in Bucharest, as well as other central locations of the city.
