By Simona Bazavan

Do you see demand for luxury housing picking up this year?
There has always been demand for luxury housing; it is just that the discussion about what luxury means has shifted. Our previous project before Amber Gardens was a residential building in the Domenii area consisting of 11 luxury apartments. It sold out in a record six months in the middle of the crisis.

So yes, there is demand for luxury and we really believe this market is starting to pick up. Also, I think we will see a lot more new projects being started this year. Not many luxury projects were being developed before so this leaves a lot of space. There will also be an increase in the number of transactions this year.

What does luxury housing mean today on the local residential market?
This is a discussion that we have always had at this company. We have been building luxury apartments on the local market since 2003 and we have constantly tried to push this concept further with every project we’ve developed. What we have seen over the years is that for householders luxury is not about having doors with gold handles; it’s about being able to make a house feel like home. And to do that you have to take into consideration all your senses and not just the visual. A luxury green home does exactly this; it addresses all the senses. It involves the smells, the quality of the air, the light, the temperature. All these are things I think make the difference and have become defining factors.

Has the concept of luxury evolved over the past few years?
Absolutely. Back in 2003 luxury meant having a bigger home. If buyers got a generous space that was enough. Things have evolved since then. Moreover, clients have more bargaining power and are more demanding as this is a buyer’s market. They also want more energy-efficient homes.

Is reducing energy costs relevant for buyers ready to pay more than EUR 200,000 for a house in your project?
I would say energy efficiency has more than one meaning. One has to do with costs. However, the price of the house is an investment which, if the client decides to sell after 10, 20 years, they will not only recover but will also make a profit. Good quality means they will spend less on maintenance and refurbishment costs over the years.

We are developing this project which today meets the requirements of the 2020 EU Directive on zero-energy buildings. We have calculated that because of this a family with two small children can save up to EUR 3,000 a year compared to a conventional house.

But this is only the financial aspect. Our clients understand the concept of sustainability and the importance of protecting the environment for future generations. And Amber Gardens demonstrates that sustainability and luxury are not incompatible: you can have both. Amber Gardens is certified by the Romania Green Building Council and also won first prize at Bucharest’s Annual Architectural Awards in 2013.

Does building a green project cost the developer more?
It is a matter of perspective. We have a very long-term strategy so costs are distributed over a much longer period, which makes them less relevant. We believe we are creating a concept that is very relevant to buyers’ needs and also enables us to differentiate ourselves on the market.

Yes, it would have been cheaper to build this project conventionally. Higher costs were generated both by research and design, understanding how your house reacts to nature (what we call bioclimatic design), as well as the actual building costs, the quality of the materials and processes used. It has taken us more than two and half years to reach the project that we have today and we see it as a long-term investment.

With office buildings there is this trend to get a BREAM or LEED certification. Why is this? Because the investors that are building these office projects anticipate that they will sell them and buyers are looking not only at the value of the building but also its running costs. And therefore for them, because they are making this long-term investment, costs become a very relevant subject. If you see your house in the same way then that part should become very relevant too.

How much are you investing in this project?
The total investment is EUR 14 million. The land cost EUR 5.5 million and has been financed by a bank (editor’s note: Alpha Bank). The construction is self-financed. This is why we are phasing out the project. The entire Amber Gardens project will feature a total of 60 luxury green houses. We anticipate it will take three more years to complete.

The land is located in Otopeni-Tunari and was acquired in 2007. We liked the area very much and the city was expanding north as it continues to do today. There were and continue to be infrastructure works in the area like the Piata Presei under-passage. All this creates very good access to the project. Also the land is very close to a forest which is another important aspect for the project’s concept. People who look for a house outside the city want to live in a healthy environment and to be close to nature.

When did you start the Amber Gardens project and how many houses have you sold so far?
We started construction last summer, in July. Right now we have almost six houses completed and we plan to build another 11 this year. As for sales, from the first ten houses we have only three still available. So we have four houses which are not yet built but have been sold.

How much do the houses cost and what is the profile of the buyer you are targeting?
Prices start at EUR 240,000 plus VAT. Most of the houses that we are selling are in the range of EUR 300,000 to EUR 450,000 as most of the buyers choose extra features such an additional room, a swimming pool or a larger garden.

From the beginning we have targeted young families for whom we are looking to create a community, but we also have older buyers. There are both Romanians and expats who pay both cash and by credit. So it is a mix.

Leonidas Anastasopoulos – CV
More than 18 years of professional experience in real estate and telecom, both in Romania and Greece.

Anastasopoulos is a founding member and has been managing partner of Alesonor since 2003. The real estate developer has invested in five residential projects in Romania as well as commercial and industrial buildings.

He is also a founding member and managing partner of Cosmos Mobile Group, as of 2005. The company is the largest independent telecommunication network of Cosmote Romania (Telekom), and the largest distributor of Vodafone and Orange, according to its data.

Anastasopoulos holds an MSc. and BSc. in Mechanical Engineering from the National Technical University of Athens and a BSc. in Business Administration from La Verne University Athens Campus.

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The new houses will be built alongside the 25 units that have already been sold and which should be completed by the end of this year. In total, the complex will host up to 50 houses.

Alex Skouras, managing partner of Alesonor, said that the local housing market is prepared to accommodate more green building projects.

Amber Gardens is located in the nothern part of Bucharest, near the Baneasa forest. The total investment capital of Alesonor stands at EUR 45 million.

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Simona Bazavan

Low emitting glass facades, fully encapsulated floors and ‘chilled beam’ ventilation solutions may sound arcane to an average employee in one of Bucharest’s many class A office buildings. Nevertheless, such technologies are ever more present and help upgrade the working environment office projects offer, developers say. And this has become an important factor given that offices are increasingly becoming a means to attract and retain employees, thereby making more and more firms focus on the quality of their working environment. “I have seen cases where companies chose a location that was inferior to their previous one due to a lower rent but were later forced to increase HR spending in order to attract employees,” Claudia Cetatoiu, senior consultant in office tenant representation at JLL Romania, told BR.

‘Millennials’ and ‘generation Y’ employees in particular are changing the way offices look and function, believes Ramona Marusac, associate director in the office agency at Colliers International. “These new generations of employees need co-working spaces, the latest technologies, areas for socializing and relaxation and they also pay attention to issues such as green practices and environmental protection,” she told BR. Moreover, investing in a class A modern office that boasts the latest building technologies and interior design solutions is not only a way to keep the employees happy, it is also a status statement for increasingly more companies.

And developers have been catering to all these requirements in recent years as they themselves compete to attract and retain tenants. The Bucharest office market has become a mature one from the point of view of the quality and technical specifications of existing buildings, argues Cetatoiu. “The feedback we get from companies that have Romania on their shortlist for opening a new location is always above expectations,” she said.

Location and rent are still the main factors a company considers when choosing a new office. So are future tenants willing to splurge on features that promise a higher quality office environment? There are firms for which costs remain the most important decision factor when choosing an office, but some tenants, especially large corporations, are willing to pay a higher rent for a building with better technical specifications, says Eduard Turcoman, senior broker in the office agency of DTZ Echinox.

All the big developers present on the local market offer efficient buildings that embody green technologies, but attracting a company that already has a leasing contract for an older project, which, despite being less efficient, has a more competitive rent, may prove difficult, says Mihai Paduroiu, head of the office agency at CBRE. “An 8 out of 10 performance is good enough for many companies and this makes the balance between investing in new technologies, furnishings and a high-end concept, and charging competitive rents, tricky to handle,” he told BR.

The actual costs of building an office project represent only 20 percent of the total costs it will incur during its life cycle, with the rest being running costs, say Siemens Romania representatives. For this reason, investments in green technologies that promise both reduced energy and maintenance costs and a sustainable and modern office environment have become the winning solution for local developers. While a few years back green certification was seen as a quality and building performance differentiator, today it has become a must.

“There is a constant, visible shift towards energy efficiency on the local office sector, with developers understanding the benefits of providing modern, energy- and money-saving spaces. The adoption of innovative technologies in our day-to-day life, the constant growth of urban areas, the growing level of client awareness – these are all aspects which influence numerous fields, including real estate, and drive the market towards greener buildings,” Sorin Visoianu, country manager operations for Romania at Immofinanz, told BR.

Green technologies dominate the market

Local real estate developers are increasingly familiar with technologies that ensure both a healthy working environment and resource-saving and cost-reducing benefits, says Marius Persinaru, president of Schneider Electric Romania and the Republic of Moldova.

“It is what we like to call the ‘green trend’ which local developers adopted very early. They were actually ‘early adopters’ of such solutions as well as promoters,” he told BR. This explains the constant growth that Schneider Electric, a provider of energy management and automatization services, has seen on both the office and residential segments in Romania, he believes. “Both companies and employees see the benefits of a space with a low impact on the environment and opt for such systems or choose companies that promote a healthy working environment,” he added.

Metroffice, the latest office development that Immofinanz is working on in Bucharest, highlights several technologies that promise such ‘greener buildings’. The developer says it focuses on providing the maximum natural lighting to functional areas, thereby ensuring both reduced energy costs, as well as a pleasant working environment. In order to limit the amount of energy necessary for heating and cooling, the building’s glass facade will have extra insulation. Other building features include curtain walls made of aluminum painted in an electrostatic field, glass shadow boxes, a HVAC (e.n. heating, ventilating, and air conditioning) system on four pipes and a floating technical floor, among many more.

An office that offers both a unique atmosphere and practical features such as energy-efficient equipment, a good quality of air and light and green areas has become part of a package that helps a company differentiate itself on the local market, AFI Europe Romania representatives told BR.

Features incorporated in the developer’s AFI Park office project include a fully encapsulated floor, an interior height level that enables maximum natural light and electricity and HVAC standards designed to accommodate a floor layout of one work station to 8 sqm. Also, to ensure an environmentally friendly and economical building, the developer has introduced HVAC thermostats which can be programmed and controlled by a building management system (BMS) that helps save energy, LED lighting systems for communal areas and sensors to shut off unnecessary use of electricity and HVAC. Low emitting glass facades give the interior isolation from outdoor temperatures.

What will follow?

When it comes to construction and technological novelties, the Romanian real estate market is very well connected to new trends introduced on more mature markets in Western Europe, believes Cetatoiu. “Many tenants have offices across the continent and they expect the same working conditions, be it in Romania, the UK, Germany or Poland,” she said. The largest office developers on the local market are also regional players, making the introduction of new technologies even easier.

Some technologies that will either be introduced or whose use will be further expanded in the years to come include modern and efficient HVAC installations which are capable of accommodating a high employee density of about one employee per 6 sqm GLA, the ‘chilled beam’ ventilation solutions which are so far only sparingly visible in Romania but more common abroad, and more advanced back-up systems which can support not only life and safety systems but a building’s entire energy consumption in the event of a power outage, outlines Paduroiu. Full LED lighting is expected to become a norm and buildings will have an increased inner room height of 3 meters (between the coffered ceiling and the floating floor), he adds.

Overall, the more extensive use of alternative energy solutions will become the focus, predicts Cetatoiu. “On European markets there is a strong focus on unconventional energy solutions, such as solar panels. So far in Romania we see this system only in some retail and residential projects,” she added.

Residential too goes green

Living in a ‘passive house’ that needs almost no outside energy sources, being able to remotely control the indoor temperature in an apartment or to get live footage of surrounding areas via a smartphone may have sounded futuristic a few years back, but these are all now available on the local market. Potential homebuyers continue to place the highest importance on factors such as a good location with access to public transport and preferably green areas, a carpet area adapted to their needs and finally an affordable price tag. Nevertheless, Romanians are becoming more and more demanding about their future home’s features and the quality of life it offers, driving demand for technologies that increase living standards. The more they can afford to splurge on their future home, the more solutions are available in the market.

On this segment too the desire to have a modern home with a healthy and comfortable living environment goes hand in hand with the requirement that it also has low running and maintenance costs, pundits say. This makes so-called ‘green technologies’ the most sought after solutions. “Developers have noticed this trend and have therefore started to invest more in durability and implicitly in innovative technologies. Several projects with a green energy component are presently in the pipeline, marking the beginning of a new trend,” Andreea Comsa, managing director of Premier Estate Management, told BR.

Overall, residential projects being built today look very different from what was developed previously. “A few years back the available supply was homogeneous. All apartment blocks were built using similar materials and they all featured the same technologies. Demand was low and investments were infrequent. Now the competition has become fierce and differentiation matters very much,” Silviu Grigorescu, general director of Hanner Romania, told BR. While three years ago the only option for thermal insulation was polystyrene, things look very different now, he adds. “Green certifications or using renewable energy have become common concerns in the market,” he said. In order to reduce energy costs, the communal areas in the first block of the project that the Lithuanian developer is building near Tineretului Park in Bucharest use features such as LED lighting. Homeowners have round-the-clock video surveillance of playgrounds and surrounding areas, which is also available via smartphone, the indoor heating systems can be controlled remotely and administrative bills can be paid online.

Even on the high-end segment of the market, green technologies are the most sought after solutions. “Compared to previous years, the market is now much more evolved and clients more demanding and informed. They are increasingly concerned about their quality of life, comfort and energy consumption. The number of those who look to the future and choose responsibly in the present has begun to rise significantly,” Leonidas Anastasopoulos, managing partner with Alesonor, told BR.

The high-end Amber Gardens housing project that the developer is building in north Bucharest brands itself as the first large-scale green luxury project. It is being built on passive house principles which the developer says go far beyond the use of photovoltaic or solar panels, as is commonly believed. Energy consumption that is 90 percent lower than that of a conventional house is ensured by high levels of insulation, the elimination of thermal bridges, heat pumps and a high level of airtightness. Air quality is provided by a mechanical ventilation system with a high heat recovery.

The ‘green trend’ is here to stay and will develop even further in the years to come, pundits predict. On more mature and advanced markets elsewhere in Europe there is an increasing focus on developing sustainable residential projects that are good for both their inhabitants and the surrounding environment, says Comsa. “Most projects have rainwater collection systems, sod or green roofs in order to insure thermal insulation or they generate all the electrical energy they need by using solar panels. Other features include technologies that monitor and adapt the indoor environment. All these technologies are meant to meet homeowners’ needs by considerably reducing running costs and increasing comfort,” she said. Local home developers are already adopting some eco-friendly technologies for their projects, but this market is still in its early stages, she stressed. The good news is that as such technologies become more widespread they will also become cheaper, making them more accessible to a wider public, concludes Grigorescu.

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