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BMI View: A steady recovery in the Romanian economy, based on strong fundamental macroeconomics in
terms of wages, consumer spending and employment figures, should see demand remain steady across the
commercial real estate sector for 2016. Headwinds from EU economic uncertainty and lower global
demand have seen buyers and tenants favour prime locations in established cities to avoid 'high-risk' assets.
However, dwindling supply lines offer stability in rental rates, and rates have even seen incremental
increases within the industrial sub-sector.
An optimistic outlook on the Romanian economy has seen investor sentiment rise across the commercial
real estate sector over the past two years, despite pessimistic views from financial institutions suggesting
long-term growth may be affected by further shortfalls in the EU. For the 2016 period, we anticipate
nominal GDP growth to appreciate 0.4% y-o-y in EUR terms. Although this is a slide from 6.4% growth,
witnessed over 2015, a slight rise in nominal GDP from EUR159.9bn to EUR160.6bn represents the
resiliency of the Romanian economy to deal with headwinds from structural frailties in the eurozone.
Although, in terms of foreign direct investment (FDI) flows, we believe there will be a possible decline as
investors are likely to sell assets with high risk and pull those form emerging economies, such as Romania,
due to the UK leaving the EU, instigating a period of uncertainty.