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IHS Global Insight estimates that GDP in Romania rose 1.9% quarter-on-quarter during the third quarter, making in one of the fastest-growing economies in the UE. In addition, year-on-year GDP growth rose 4.5%, according to the National Institute of Statistics.

The global real estate services firm, Cushman & Wakefield makes public facts and figures regarding the evolution of the industrial real estate market in the past year as well as projection on 2012. Also, Cushman & Wakefield announces a 15% market share in 2011 out of the total Romanian industrial market segment. This percentage represents 25.000 sqm industrial spaces leased by Cushman & Wakefield out of 150.000 sqm which represent approximately the total industrial space, transactions made in 2011.

According to Cushman & Wakefield, the Romanian industrial real estate market grew with approximately 100% in 2011, as total surface leased. “At the end of Q4 2011 we could had spoken of a transacted area of approximately 150.000 sqm compared to 75.000 sqm at the end on Q4 2010”, explained Gabriel Sfetcu, Head of Industrial Department at Cushman & Wakefield Romania. “As well”, continues the Head of Industrial Department, “in 2011 we had more requests from the production industry, in the same time we received requests from new-entry logistics’ operators, resultant from mergers or separation of other operators already existing on the market.”

The global debt funding gap has been cut by 27% over the past six months. It is now estimated at US$142bn down from US$196bn six months ago (Figure 1). More detailed data from our recent bank survey has triggered a 74% reduction of the Japanese debt funding gap in the last 6 months.
Unfortunately, Europe continues to struggle, as downgrades to our capital value forecasts have led to a 4% increase in the funding gap.

The UK, Spain and Ireland have all seen an increase in their gap on both an absolute and relative basis.
Sufficient equity remains available to bridge the debt funding gap. Globally, there is nearly $400bn of equity available - nearly three times the current gap. Significant regional differences remain. The European ratio is less favourable as US$156bn of equity is available to bridge a US$122bn debt funding gap.
Banks are taking steps to shrink and deleverage their balance sheets with a growing number of loan sales being brought to the market. Loan sales are likely to increase as regulatory authorities require banks to further bolster their capital reserve positions. We view the recent interest from SWF and other institutional buyers of such loan portfolios as a very positive sign. Discounts might come in, as return requirements become more realistic.
Increased lending from insurers, institutions and other niche lenders has started to provide new capacity. Based on this, we have raised our estimate of new non-bank lending for the next three years by over 80%, from $80bn to $150bn.

European total real estate investment activity reached EUR 25.7bn in Q3 2011, a 3% decrease on Q2 2011. The eighth consecutive increase in the four quarter moving average underscores underlying momentum in the market. But the pace of this increase has reduced significantly reflecting growing concerns over financial markets.
In Europe s largest markets we saw some diverging trends. Whilst France and Germany posted growth over the quarter, the UK saw volumes fall. The CEE markets have once again registered a good performance with volumes of EUR 1.7bn, whilst the Nordics markets came back to its lower but usual level of activity.
Cross border investment rose to EUR 10.5bn reflecting higher levels of both inter and intra-regional activity. Non-European investors increased their exposure most as net investment volumes reached EUR 2.7bn in Q3. Domestic investors remain net sellers (Figure 1).

Private property vehicles are still dominant on the European market, with EUR 13.2bn of acquisitions and positive net investment. The listed sector posted its strongest level of activity in two years in Q3, investing EUR 5.3bn.
Retail investment exceeded that of offices for the second time this year with volumes of EUR 9.2bn. Competition is strong between investors to acquire the best quality shopping centres.
We see steady growth in activity, with investment volumes set to reach EUR 121bn in 2012, up 11% on our estimated EUR 109bn for 2011. Activity will be supported by a growing level of sales from the banks as they continue to deleverage their balance sheets.

The beginning of the year followed the same lines established in the last two years. The Bucharest industrial and logistic stock did not witness any important change during the first quarter, reaching 917,000 m2. Construction works ended in A1 Business Park, thus adding another 10,000 m2 to the volume of the park and to the Bucharest stock. This situation could change though, as a couple of projects could restart construction works and bring available space to the market in 6 to 9 months

Historically, demand in the Central and Eastern Europe has been driven primarily by three types of occupiers: production/manufacturing and assembly sector, retailers and wholesalers, and logistic operators. The last ones comprise the largest market share; their business is however driven by the needs of the manufacturing and retail sectors. In addition, according to Eurostat, the volume of retail trade in Romania decreased by almost 5% in February, compared to the same period last year. Although the pace slowed in the previous months, last year s economic changes, national and regional, influenced the industrial and logistic space demand.