The IntelliNews Romania Construction Sector Report offers an extensive summary of the most recent topics related to the Romanian construction and infrastructure market. It includes a complete coverage of the latest market developments and news, accompanied by thorough statistics and comments. The report pays particular attention to new development projects and investment inflows in the sector. This sector report is ideal to keep you abreast on recent company and industry news. Written by local professionals, it is a unique market and business intelligence analysis, tailored to save time by providing in-depth information, while helping you to make confident and informed business decisions.

Summary

The construction works volume index shrank by 0.2% y/y in 2012, returning in the negative area after the 2.8% y/y growth in 2011. The seasonally-adjusted construction index managed to record marginal 1.6% y/y positive performance last year, but the activity in the sector remained however by nearly 25% below the pre-crisis level in 2008.

The construction works dynamics recorded encouraging performance in H1/2012, but the activity in the sector weakened abruptly in the second half of the year, affected by the political turmoil in Jul-Aug which froze public investments. Subsequently, the government’s decision to cut down public funding for infrastructure under the autumn budget adjustment further contributed to the deterioration of the situation in the sector. Large infrastructure projects had to be slowed down and the government is still exploring options for securing the necessary financing to move on with most of them.

The real estate market seems to have stabilised at low levels in 2012. The value of real estate transactions inched up by some 6.3% y/y last year, according to market estimates, but the total remains much below EUR 1bn annual average in the pre-crisis years.

The retail segment remains attractive for international players, but despite the visible reviving appetite for developing new modern retail schemes, the investors and developers remain cautious, as the projects are currently mostly financed through their own resources.

The residential segment saw the most stable year in terms of price decline since 2009, when the residential property prices started to drop. Nonetheless, the market remained overall frozen and the situation is unlikely to witness abrupt changes as long as financing for individual and corporate investors remains tight. The government’s subsidized home loan scheme ‘Prima casa’ (First Home) did not have a significant impact on the number of transactions last year, market data show. On the upside, we note the rising interest of investors in developing new residential compounds, encouraged by lowering land prices and more affordable construction costs.

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Table of Contents

Executive summary.
Market overview
Infrastructure. 
Real estate. 

Table 1 Construction sector's performance in 2007-2013 (y/y)
Table 2 Construction works index in 2010-2012- Quarterly performance by structure (y/y)
Table 3 Construction works index in 2010-2012 - Quarterly performance by destination (y/y)
Table 4 Construction output in 2012-2013 (y/y, in %)
Table 5 Construction sector- Selective indicators in 2008-2012
Table 6 Completed dwellings per type of financing in 2010-2012 (number, quarterly)
Table 7 Completed dwellings per type of financing in 2007-2012 (annual, y/y)
Table 8 Building permits for residential buildings issued in 2003-2012 (number, y/y, annually)
Table 9 Major infrastructure projects awarded by CNADNR in 2012 
Table 10 Residential property price indices in 2010-2012
Table 11 Major retail projects completed in 2012

Figure 1 Construction works index in 2007-2012 (monthly, 2005=100)
Figure 2 Construction works index in 2005-2012 (monthly, y/y)
Figure 3 Building permits issued for residential buildings in 2007-2012 (number, monthly)
Figure 4 Investments in national economy by sector in 2011-2012 (% in total)