ProLogis has announced that it has begun development of its first industrial facilities in Romania. The company has acquired 69 acres (28 hectares) of land west of Bucharest along Romania's A1 motorway, the country's primary transit corridor. Plans for the site, to be called ProLogis Park Bucharest A1, call for six buildings totaling more than 1.7 million sq.ft. (157,700 sq.m.) of industrial space.
"Over the past several years, the central and eastern regions of Europe have emerged as strategically important areas for industrial distribution," said Walt Rakowich, president and COO of ProLogis. "Our company has been successful in anticipating this trend, and now has market-leading positions in Poland and Hungary as well as one of the largest industrial platforms in the Czech Republic.
"We're pleased now to be entering Romania, where we see a combination of robust demand for state-of-the-art facilities and a shortage of high-quality supply. As such, we believe this transaction will deliver real benefits both for customers with European operations and our investors."
Initial investment will consist of land acquisition, infrastructure improvements and construction of two distribution centers comprising 609,000 sq.ft. (56,600 sq.m.), with completion of the first facility planned for the second half of this year. Total investment at the park is expected to exceed US$80 million.
"With 22 million people and GDP growth exceeding 5% annually, Romania offers tremendous potential for manufacturers, retailers, logistics providers and other companies with distribution needs in this region," said Michael de Jong-Douglas, senior vice president for central and eastern Europe.
Muler Onofrei, ProLogis market officer for Romania, noted that vacancy rates for modern industrial buildings are already very low in Romania today - about 2%. "Romania's scheduled admission into the European Union in January 2007 should accelerate demand even further," Onofrei said. "Investing in Romania now will enable ProLogis to leverage its deep existing relationships with global customers and establish itself as a primary provider of industrial space to the Romanian market."