Immoeast slashes EUR 2 bln of investment plans, freezes some Romanian projects

“Prior to the start of construction, for all projects now in the planning stages an evaluation will take place concerning whether realization under changed market conditions is reasonable, or whether a delay or, in isolated cases, even a cancellation of building phases is appropriate,” said Immoeast.
Measures will be taken in all regions, especially Romania, according to the investment fund. It did not name the planned projects which it could abandon in Romania.
The fund has been affected by the global financial crisis, increase of yields and strengthening of local currencies against the euro. The fund's shares, which are listed on the Vienna and Warsaw stock exchanges, have lost two thirds of their value this year.
At the end of July this year, Immoeast controlled 134 properties in Romania, with a total value of EUR 3.44 billion. The Romanian portfolio made up 31.6 percent of the fund's entire portfolio, while in July last year, the figure was 32.8 percent. Its European portfolio dropped in value by EUR 294 million, to EUR 10 billion. The fund, which is part of the Immofinanz group, is discussing with its mother company, joint sales of properties worth EUR 400 million.
In certain Romanian cities, the fund controls more than one property on the same market segment. Immoeast owns projects like S-Park, Victoria Park, Iride office compounds, plus several shopping centers already opened, such as Euromall Pitesti, Armonia Arad and Polus Center Cluj, and others in the making, such as Trident Plaza.
Corina Saceanu