Savin explained that once the project begins, the crisis wave will subside and he predicts that bank liquidity will return. The company announced an increase in the investment value in the Brasov project this June to €1.5 billion from €800 million, due to a rise in construction costs.
“We, as well as other players, hope that construction costs will drop, considering an increasing number of developers are foregoing projects, and we can already observe a decrease in the price of materials,” Savin added.
Even if construction costs drop, the value of the investment remains the same, as the project will take ten years to complete, and it is difficult to estimate how prices will evolve in the long-run.
Flavius Investitii will build a real estate project on some 100 of the 120 hectares of the former plant, which is to include homes, offices, a mall, hotels, schools, kindergartens, and a conference center. “We will probably begin with the retail component of the project, considering that Brasov needs commercial space,” Savin explained.
