A crisis of real estate industry was imminent three years ago, yet the market is seemingly more buoyant than insiders had predicted. The global downturn saved us from a local crisis, as the entire real estate market and especially the retail segment was heading rapidly toward a freefall, said Bogdan Georgescu, Managing Partner at Colliers International.
“The hunger to develop made us turn a blind eye to the real needs of people. We failed to remember how to make money by working. All we can do now is to learn how to dodge a local backlash, after relying too much on shallowness and applause to those who get over the system”, said Bogdan Georgescu (photo).
The global downturn saved the real estate market from a local crisis, imminent over the next two-three years, as too many “absurd projects” that received funding were already up and running. The crisis has only affected demand in real estate market and not the offer.
“There was an over-crowded market, especially the retail one, that couldn’t even bear a quarter of the projects pending for financing. We are heading to a collapse of the real estate market, but the crisis is now forcing us to examine closely each project. We would likely have to face a local crisis once the global downturn will have ended”, Colliers managing partner said.
Georgescu gave as negative examples the projects in Ploiesti and Arad, where five new shopping centers were announced to be delivered. Apart from the announced projects, many of those already on the real estate market proved to be poorly designed, constructed only to be sold, that can be summed up in a single phrase “one size fits all”, an approach whose time has come to an end. This is why many players should commit on a longer term, without any one-time speculations.
One department shut down and two reorganized
Colliers has released yesterday the market report for 2009. This year, the company said it would focus on corporate services to meet the business-to-business needs and less those related to personal life. In the light of these purposes, the company shut down the residential department and readies the delivery of new services to adapt to the shaky economic grounds.
“We shut down the residential department because the market called for such a measure, as there was roughly null demand on the market. Half of the staff has been reassigned to other departments, while the others found a job somewhere else. The residential market didn’t have synergy with the other departments any longer”, said Bogdan Georgescu.
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