“The evolution of the real estate division is the worst of the entire group. Following investments in excess of €25 million, we have completed products since spring, but have not managed to sell more than 30 percent, due to the deadlock. Upon analyzing the market, we decided that for the new unit in Timisoara it is better to focus on homes with small surfaces, with prices complying with those of the “First Home” programme,” the businessman told Business Standard.
Ovidiu Tender said that, in spite of the crisis, the Romanian real estate market has not reached the level of the Spanish deadlock – where all projects were frozen due to an excess in housing units. He does not know when he will be able to resume his investments, but is unable to sell these as there are no buyers.
“Romania is still in the stage in which developers are struggling to pay their bank installments. It has not yet come to that stage when the bank takes over the assets of [real estate] developers who are unable to pay their installments. We [Romania] too will reach that stage, most likely as of the second quarter of 2010,” the businessman said.
Tender estimated that the Romanian real estate market will rebound in 2011, but expects the country will overcome the crisis next year. The deadlock on the real estate market led to a freezing of all expansion plans announced by the businessman in mid-2008. “We do not have loans. We ensure our investments from the sale of real estate and trading on the Stock Exchange. As both these markets are blocked, we cannot get money, so we are forced to postpone all investments,” Tender indicated.
