Futureal partner with Cora in Romania for its new shopping center, Gold Plaza, Baia Mare (RO/HU)

Despite a fluctuating market environment,Futureal Development's commercial projects are progressing successfully. Futureal have signed a long-term lease agreement for up to 30 years with Cora, the hypermarket chain, in Futureal's Gold Plaza shopping centre in Baia Mare, Maremures, Romania. The deal brings the ratio of leased space in Gold Plaza up to 70 per cent. While all sectors are affected by the economic crisis, with the retail property market being no exception, not everyone is affected in the same way. While business ground to a halt in 2009, high-quality, well thought-out shopping centres in favourable locations scheduled to open in 2010 are once again sough after by strong international retailers .

At the end of November, Futureal Development Zrt. signed a lease agreement with Cora, one of the best performing retail chains in the Romanian market. The ten-year agreement for almost 8,000 square metres of leased space also contains an option to extend the agreement up to a period of 30 years. As a result of the deal, the ratio of leased space in the Baia Mare shopping centre—scheduled to open in autumn 2010—has risen to 70 per cent.

"During the property market boom Cora did not automatically expand like its rivals. It has been opening new stores based on a meticulously crafted strategy, and a very selective approach. In turn, they have benefited from phenomenal figures of turnover per unit and overall profitability. Cora CEO and owner of the Louis Delhaize Group has personally travelled to Baia Mare to visit the site and study the development.
All sectors have witnessed a decline in leasing activity. After the great wave of 2007-2008, Romania was also hit by the slow-down, with several brands postponing the opening of their new units this year. In light of this, we consider the signing of this lease agreement an outstanding accomplishment." – commented Tibor Tatár, CEO of Futureal Development Zrt at a press briefing held at the company's headquarters.

The economic crisis significantly rewrote the development of the commercial real estate market in 2009, and its impact will most likely be felt during the next few years. A mere 20 per cent of projects slated for completion this year were realized in Budapest and the country. Similar tendencies prevail in other European countries as well.

"According to the most recent report by the Central Statistical Office, September witnessed a 7.3 per cent drop in retail trade compared to one year before. Within this overall trend, retail trade in textiles, apparel and shoes declined by 3.3 per cent. The latter figure, which may be of the greatest interest to those who lease shopping centre space, is not as bad as the trade had expected. In consequence, it will be the retail results of the Christmas shopping period that will influence retailers' plans for 2010. It appears certain based on MAPIC experiences that major international chains will once again embark on the path of expansion. Which countries will they pick? This question will be decided in the next 2-3 months. In Central Europe, Poland's standing is the best in terms of the future of retail trade, while that of Hungary's and Romania's is, unfortunately, the worst." – said Tibor Tatár, describing the current real estate market situation.

Futureal Development's CEO also discussed the near future: „Based on current agency prognoses, we can most certainly be hopeful in looking ahead to the future. There is perceptible improvement in investor interest, albeit financing remains restricted and delays can also be expected. As I've already mentioned, leasing activity has declined in all sectors, including retail trade. At MAPIC, however, a cautious, but assertive interest was definitely discernable. The fall in lease fees will soon bottom out; at the same time the amount of future investment projects will remain low. Thus, as of 2010 an improvement in the balance of supply and demand can be prognosticated, with the market gradually tilting towards greater equilibrium.

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