Sonae Sierra chose Romania and Poland in CEE out of its international markets. Could you elaborate on the selection process and Romania’s position in the overall development portfolio?

Romania, when we entered the market in 2007, was and still is a landscape brimming with potential, especially when compared to more mature sectors in Portugal, France, and Spain. Initially, Romania held significant potential for shopping center development, but today, our focus lies in the expansion and refurbishment of existing assets and enhancing Property Management solutions to optimize income streams. The evolution toward multiple-use assets combining various elements to create a unified, comprehensive destination is another exciting prospect.

You’ve mentioned plans for boutique residential development. Could you elaborate on this strategy?

Evaluating market fundamentals and demographics led us to consider residential development as the next step following the success of ParkLake. We plan to construct approximately 240 boutique apartments by 2023, aiming for a mid to high-range product that distinguishes itself through quality while remaining grounded in local price expectations.

What were the primary challenges specific to the local market that you encountered?

Licensing and permitting processes posed considerable challenges, often lengthy and demanding. Despite these hurdles, we remain optimistic, expecting improvements given historical trends showcasing an evolving and increasingly business-aware environment. Our project’s success has contributed to this optimism, and we anticipate obtaining all permits by the end of 2021.

Aside from development, Sonae Sierra offers a range of services. What’s the demand like for these services in the CEE region?

Our services encompass the entire property lifecycle, from property management to development, allowing us to leverage international experience and expertise. Working primarily through partnerships, we ensure clients have access to comprehensive real estate lifecycle services, navigating complex projects with local market insights and expertise.

Has the pandemic prompted a shift toward more service-oriented approaches in response to retail challenges?

Not particularly. Sonae Sierra has a long history of offering services and managing third-party real estate assets. We’ve been extensively involved in managing and leasing various real estate assets alongside owning shopping centers.

Are companies increasingly preferring in-house solutions to manage their service needs?

It varies among companies and countries. In mature markets, institutional investors tend to focus on asset ownership while relying on specialized companies like us for management, refurbishment, and expansion. Opting solely for in-house solutions might not always provide the best long-term results due to potential expertise gaps in certain areas.

What are the upcoming priorities for Sonae Sierra in Romania in the next few years?

We’re eyeing three residential projects by 2025, carefully assessing locations and formats that align with local identities and market demands. The success of our initial 240-apartment project in 2023 will shape our future ambitions in the residential sector. Land availability remains a crucial factor. Additionally, we’re focused on retail-based urban living spaces, integrating retail expertise with office and residential offerings, emphasizing Romania’s significance in our strategic landscape.