Affan Yildirim, general manager of Anchor Grup, talks to BR about the company’s plans to expand its footprint into Bucharest’s residential segment this year and his outlook on the local real estate market through to yearend.
Last year you announced plans to invest in a residential project. What is the project’s status and when do you plan to deliver the first units?
A new housing project will be developed on an 8,000 sqm plot of land that was left after the demolition of the former Select factory, located between the InCity complex on Calea Dudesti and the RATB Dudesti roundhouse. The new residential complex will include 188 apartments in four buildings containing a basement and six floors, and it will have the same quality elements as InCity Residences, including some luxury ones. The apartments will be delivered with a ready set-up and furbished kitchen. The majority will have three rooms, but there will also be studios and two-room flats available. According to our current estimations, the project is due to be completed in the last quarter of 2018.
Are you looking at starting other projects on the local market?
For 20 years now we have been one of the most active real estate players in Romania; we’re always open to new opportunities and challenges. Apart from the new residential compound, we are developing the concept for a residential project of approximately 200 apartments in two buildings. We’re waiting for our permit for the first building and we intend to begin construction works by this summer. This project will target the mid-market segment.
Furthermore, we have several plots of land on which we plan to develop a series of luxury residential projects. Constructions works are planned to begin towards the end of 2018.
How do you expect the local real estate market overall to evolve by yearend and where do you see growth coming from?
The growth of the local real estate market that was characteristic of 2016 will continue in 2017, according to our predictions. This sector is expanding at a fast rate, hence the increase in prices that was invoked by BNR as a low intensity risk. But this is not the same market as in 2008. Nowadays, just like us, most developers look at the long term and privilege sustainable investments, not just short-term opportunities, because they want certain, long-term earnings. Furthermore, more experienced investors are entering the market. This means that it will become more sustainable and further consolidated. The growth in real estate is fueled by the increase in private consumption, which also seems to be continuing this year.
Which of the market’s main segments do you think will perform best this year and why?
According to our research, office and residential will be on the rise in 2017. The first one attracts the second and vice versa, just as the second gravitates toward shopping centers. Therefore, this is a time for developers to work closely in order to create symbiotic entities that are of use to entire communities and change the urban landscape for the better: one is in charge of an office building next to a shopping center, another implements a housing project nearby.
The arrival of new investors does not mean that there will be a decrease in the quality of projects, because buyers, like tenants, are becoming more and more sophisticated. They no longer want to buy or rent an office space, a retail space or an apartment; they focus on the entire experience and on the benefits it provides them with. This means that developers have to keep their eyes on all these factors external to the project.
How did your two local malls perform in the first half of the year?
Very well. The occupancy rate stands at 97 percent in Bucuresti Mall and 95 percent in Plaza Romania, and negotiations are under way for the leasing out of the remaining spaces. There was also an increase in footfall.
Which are the most active retailers in terms of expansion and what are the latest changes you have made to the two malls’ tenant mix?
We are working on optimizing our tenant mix in both malls. So far in 2017, in Bucuresti Mall, we have inaugurated Anna Cori (115 sqm), Pravalia cu Retusuri (30 sqm), Hippoland (730 sqm), dm drogerie markt (300 sqm) and Nissa (120 sqm). Media Galaxy has completely refurbished its store on the third floor, Paul Bakery has reopened based on a new concept, while Mango and Musette have expanded, occupying now over 1,350 sqm and 200 sqm, respectively.
In June, Aperto (700 sqm) and Taksim (105 sqm) will open outlets in Bucuresti Mall. Over the next few months, the mall’s customers will also be able to purchase items from Buzz, Triumph, Inmedio, Douglas and Tommy Hilfiger Kids.
At Plaza Romania, in 2017 we have inaugurated Triumph (60 sqm), dm drogerie markt (270 sqm) and Banca Transilvania (80 sqm),while Fun Planet (260 sqm) and Il Passo (85 sqm) have relocated and reopened this year with their latest concepts. Since May, the customers of the mall have been able to enjoy the food of Pep & Pepper (125 sqm).
As for the near future, by the end of summer, three new operataors will complete the food court mix at Plaza Romania: Taksim Restaurant Mesopotamia and Donuterie.
Also, we can announce that in the near future, Plaza Romania will accomodate the Bucharest Passport Office, on 860 sqm, located on the second floor.
Moreover, in September, Farmacia Tei (750 sqm) and a Bebe Tei store (1,750 sqm) will be inaugurated. Overall, 20 more outlets will open in Bucuresti Mall and Plaza Romania.
Affan Yildirim has served as CEO of Anchor Grup since April 2015, having previously acted as CFO and interim GM. He has an extensive professional background in the financial field, real estate, retail and office development. Over the years he has been in charge of several large projects and has also shown an entrepreneurial spirit.
Yildirim started his career with PwC in 2004 as audit manager. Between 2011 and 2012 he was VP and CFO of Credit Europe Leasing IFN Romania. The Anchor Grup head graduated in Finance and Business Administration from Marmara University in Turkey.