City Mall developers turn to housing and offices with EUR 260 million

Upground will build the mixed project of the same name on a 44,000 sqm plot in the Lacul Tei area of Bucharest. The project will feature two blocks of 600 flats, totalling 126,000 sqm. The office buildings will cover 100,000 sqm. The developers expect the value of the project to almost double when it is completed. Works started in March this year and will end in 2009. The blocks of flats will have 16 floors and feature apartments of between 97 and 400 sqm. Sale prices start at EUR 1,600 per sqm, leasing a EUR 168,000 (VAT not included) for a two-roomed flat up to EUR 1.2 million for a penthouse. “We have received many requests for the penthouses, because the market is limited for these units. We have also had demand for all sorts of apartments in Upground from investment funds from Greece, UK and Spain, said Valentin Preda, head of the company. The office buildings, which will need EUR 160 million to be developed, will feature six and seven floors, respectively. Half of the first building has already been leased by Bancpost. The bank had previously leased space from the developers while they were owners of PGV Tower office building. Upground will finance the project using a EUR 150 million loan from Banca Romaneasca and Bancpost, the rest being covered by its own funds. The company is planning other residential projects in Bucharest, where it owns several plots exceeding 100 hectares. “For the moment, we are focusing on this project, which is a large one. We would like to develop other projects and we actually have offers from developers to buy the projects they have started,” said Preda. Both projects previously owned by the Upground investors, PGV Tower and City Mall, were sold to investment funds, Charlemagne and APN/UKA, respectively.

Corina Saceanu