Real estate developer AFI Europe, controlled by Israeli billionaire Lev Leviev, started works for buildings four and five of AFI Park office project, built around AFI Cotroceni shopping center of Bucharest. The buildings need investments of around EUR50 million, according to ZF estimates.
AFI completed and rented out the first two buildings of the project, works for the third building have reached the fourth floor out of ten and almost half of spaces have already been rented by Britain’s group Endava. Hence, the developer decided to start raising the last two buildings of the business park though it has secured no banking funding or signed any contracts with potential tenants so far.
“The two buildings will have a rentable area of around 30,000 square meters and will be delivered at the end of next year. We have no contracts signed for these spaces, but all the buildings of the project were developed speculatively, with no pre-rental contracts. Nevertheless, we managed to rent them. After these buildings are completed, almost 7,000 employees will work in AFI Park,” David Hay, chief executive officer of AFI Europe Romania, told ZF.
He did not disclose the value of investments in the two buildings. For the first stage of works, a contract was signed with building company Danya Cebus, which also raised the first two buildings of the project and is carrying out works at the third building.
Hay says that Electronic Arts, the producer of FIFA game, has moved to the AFI Park 2 building and AFI Park 3 building will be delivered by yearend.
“The office market and the IT&C sector in particular look good, with many signed contracts and a lot of companies with expansion plans. We believe this is the right time to build,” added Hay.
On Bucharest’s office market, contracts for spaces of around 60,000 square meters were sealed in the first quarter of this year, with 66% of the area being rented to IT&C companies, according to a survey by DTZ Echinox consultancy.
On the other hand, new buildings with an area of above 100,000 square meters are expected to be delivered by yearend though around 345,000 square meters of offices are now vacant.
After buildings four and five are completed, AFI’s business park will reach a rentable area of around 65,000 square meters, among the largest in Bucharest.
At the same time, the almost 7,000 employees set to work in these office buildings will contribute to AFI Cotroceni traffic. The center currently attracts around 53,000 visitors per day on average.
With access to the subway and proximity to the Polytechnic University, the area AFI is located in has in recent years become even more attractive after Basarab passageway was finalized.