Romanian developer IULIUS has invested more than EUR 1.2 billion in regional cities, with a direct impact of more than EUR 190 million for local communities. Raluca Munteanu, business development manager at IULIUS, spoke to BR about the company’s approach to urban regeneration with a focus on sustainability and its plans for the massive mixed-use project in Cluj, where the total investment will go above EUR 500 million.
By Ovidiu Posirca
How important are urban regeneration projects in shaping the future of Romanian cities?
Such projects have a multiplier effect, meaning that they generate new investments. Let me give you the concrete examples of the IULIUS projects in Iasi and Timisoara, which stand out as regional business hubs with 120 tenant companies that operate in some of the most dynamic sectors of the economy and have more than 23,000 employees.
Urban regeneration projects are a way of revitalizing the areas, maybe unappreciated ones, and valorizing the real potential that they bear, giving them a role of development on all levels, and thus preparing the cities of the future. From our perspective, the regeneration and development of the cities is a participative mission that we all, from public and private sector, contribute to.
The urban regeneration projects are complex, mixed-use, and for developing them you need to look closely at the city, even the region, so that they meet a package of requirements and expectations that arise from everyday life, and to an equal extent, have that vision on the future, as such investment is made for the present, but also for the next generations. And it is this very complexity that renders a new impetus, stimulating the interest of the business environment and communities alike.
What has been IULIUS’s contribution to the local economies in which it has developed mixed-use projects?
The company’s investments so far in the regional cities of Iasi, Timisoara, Cluj-Napoca, and Suceava have surpassed EUR 1.2 billion. Our portfolio includes over 310,000 sqm of retail space, occupied by more than 1,000 retailers, newly entered brands on the regional and even national market, as well as brands that have developed over the years from a single location to national chains that expand beyond our projects. In terms of offices, we are operating 15 A-class office buildings, covering over 242,000 sqm, with more than 130 offices of multinational companies, some of them having entered the Romanian market through our projects. Overall, there are more than 35,000 employees working inside IULIUS projects. All these companies are paying taxes to the local and state budgets, which can be further directed towards projects that address pressing urban issues.
The investments that we deem direct in the communities in which we are operating total more than EUR 190 million, including urban gardens created from scratch, newly built or optimised infrastructure, public utility buildings, as well as parking lots that alleviate some of the pressure of insufficient public parking spaces.
How do you approach urban regeneration projects from the point of view of sustainable development?
All our properties are certified based on international sustainability standards, which confirms the quality of the materials we’ve used and the implementation of energy efficiency solutions. Palas Campus, the project we recently opened after an investment of EUR 120 million, is not only the biggest office building in the country, but also the first to obtain a green loan granted to a Romanian company by the International Finance Corporation (IFC), the World Bank’s investment division, in the amount of EUR 72 million.
We also support alternative mobility as an instrument to stimulate a healthy lifestyle and reduce pollution. In all our projects, we have invested in dedicated infrastructure by fitting out bike lanes and parking spaces, and we are carrying out special projects for our tenants with the aim of increasing the community of cyclists.
Over the past few years, we have implemented solutions to increase energy efficiency and reduce costs, through the installation of photovoltaic panels on all the buildings in the IULIUS portfolio. The project had a total cost of EUR 3.5 million, and it is estimated to save 10 percent of the total energy consumed by the group.
Sustainability also means investment in green areas, and the IULIUS gardens excel on this front. They have been designed by European landscapers and they compete with famous parks in metropolitan cities abroad, having received aggregate investments of EUR 17 million. The gardens are inhabitants’ favourite meeting points, and over time they have become genuine performance stages.
When do you expect to kick off the development of your new large-scale mixed-use project in Cluj?
For the project in Cluj-Napoca, the first concern was the relocation of Carbochim, which is now doing business in an industrial area of the city. The relocation and modernisation of the factory required an investment of EUR 5 million. We are now in the process of obtaining approvals for the urban regeneration project that we aim to develop on the former industrial platform.
There are a number of aspects posing a high level of complexity for this project. It is a large investment of more than EUR 500 million, probably the largest real estate financing; an urban reconversion initiative for an industrial platform that was partially still in use, which is why we have made efforts to allow it to continue its manufacturing activity elsewhere; an industrial area that we want to open up to the public, make it part of the city and of people’s lives, all while preserving its heritage and respecting its history.
The future project aligns with the city’s overall development strategy and especially that of the area, by continuing projects that have been started and even completed by the local administration in terms of green spaces (Feroviarilor Park and Armatura Park), with a particular focus on maximising the value of the Somes river. We aim to create harmony with the city through green and road connectivity, so that the end result will be a regional project which is unique in Transylvania and Romania. In terms of the uses of the future project, it will include the largest retail area in the country—over 115,000 sqm—, the first performative arts hub to be integrated in a real estate project, a residential area, office spaces, a park and an open-air sports centre. A distinctive element of the project will be the preservation and consolidation of two buildings that are part of the industrial heritage, thus preserving the identity of the venue.
Community involvement is a key element for us, which is why we have already conducted a public consultation campaign in order to become aware of the expectations Cluj inhabitants have for this initiative. The fact that around 10,000 people have responded makes us really happy and also holds us accountable.
Do you have the net zero objective in mind as you plan your next investments? How open are financing institutions to back urban regeneration projects?
The net zero emissions objective is a permanent concern for us, given that buildings are responsible for 30 percent of global greenhouse gas emissions, so we are pursuing solutions to accelerate the achievement of this goal. In this respect, IULIUS has signed a partnership with IFC to put together a decarbonisation strategy for the company’s entire portfolio.
In terms of the financing, I can only talk about IULIUS’s urban regeneration projects, for which we have always succeeded in obtaining support from lending institutions, perhaps also due to the history of the group. Our portfolio speaks about the efficiency, resilience, attractiveness, and durability of our projects, the implementation of sustainable policies, a clear and well-researched strategy for development, and last but not least, the responsible manner of operation.