Banks in Romania no longer grant loans for shopping centre construction

2010-03-08

In the current financial climate, banks in Romania are less eager to finance the construction of new shopping centres. This is the main reason behind the suspension of several shopping centre projects in Bucharest. As such, over the next three-to-five years Bucharest is expected to see the construction of only five more shopping centres if the projects’ developers are able to secure the required loans.
In recent years, banks were the main financial backers of shopping centre construction in Romania. Of the ten shopping centres that have appeared in Bucharest since 2006, only two – Sun Plaza and Militari – were financed using their investors’ own capital. Construction of the other eight shopping centres was financially supported by bank loans totalling €850m, according to estimates from Ziarul Financiar.
The bank, UniCredit Tiriac, has thus far been, in terms of total value of loans provided, the main financier of shopping centre construction in Bucharest. Projects financed by the bank include the Baneasa Shopping City, City Mall, Grand Arena and Vitantis.