Markus Neurauter, Raiffeisen evolution

Created from the Raiffeisen Group’s developers and Strabag AG’s Project Development Division for Austria and Eastern Europe, Raiffeisen evolution is one of the market leaders in Austria and CEE. Its operations are focused on Central and Eastern Europe and its declared objective is to achieve a leadership position throughout the entire target market. Markus Neurauter, Managing Director, spoke to REP about the company and its future goals.

What is Raiffeisen evolution’s general business and which markets are you typically active in?

“Raiffeisen evolution focuses mainly on the development of commercial and residential projects but offers also various services during the lifecycle of real estate, such as project management, construction, etc. At present we are active in 11 markets including Austria. Currently we have sites under construction in Moscow, in Warsaw, in Bucharest and in Vienna.

“It is not our aim to keep standing assets on our books. We acquire and develop the site, sometimes if profitable we sell the development before realization but most of the time we realize it, rent it out and sell if to investors. Right now we are working on over 30 developments, with a total investment volume of €1.2 billion.”

Given that last year has been difficult for everyone, how has the market been treating you?

“It was a very difficult time. We did not acquire anything in 2009 and 2010 except in Austria. Nevertheless there were quite a few developments under construction. Due to this situation we decided to redevelop for example the large urban development Floreasca City Center in Bucharest. Across Europe just a few developers have sites under construction like us. So at the time our projects under construction will be finished they will be perfect to meet the demand of our future tenants.”

In which of the countries where you are located right now do you see the biggest opportunities?

“In general in the markets where the circumstances are most challenging. A different story would be Russia/Moscow where we already face a very good market situation and where we believe that the situation will last at least for the next two to three years. A very good reference of ours would be our current project at Leninskiy Prospect in Moscow which will be finished by the end of this year.

“We hesitate to invest in residential projects in certain CEE markets because of the local situation in the banking sector. Retail is the sector that is still important and works almost everywhere in Eastern Europe. So for me the most important market is yet again Russia, and then it is going to be Hungary and it will also be Bulgaria. Kiev as a market is observed very thoroughly by us at the moment which gives us the chance to be active in the moment when the market picks up.”

What differentiates you from the competition?

“The biggest advantage is our shareholder structure, because we have the equity, we have the possibility to receive credit financing, when other investors do have more difficulties to receive financing.”

Are you looking for partners in projects or you are trying to do everything yourselves in the beginning?

“Our focus is to have full control of our projects therefore we prefer to work alone but in certain cases we are open for joint-ventures depending on the structure.”

And the year ahead, you mentioned you are building a new shopping mall in Bucharest when is it going to be developed?

We are already constructing Promenada Mall as part of the Floreasca City Center development. It offers over 30,000 m² of leasable space of which 50% have been already pre-leased to international retailers. The opening date will be by the end of 2013.”

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