Successfully reported this slideshow.
Your SlideShare is downloading. ×

ƵileleBiz 2010: South Pacific / Andrew Prelea

Ad
Ad
Ad
Ad
Ad
Ad
Ad
Ad
Ad
Ad
Ad
Loading in …3
×

Check these out next

1 of 9 Ad
Advertisement

More Related Content

Similar to ƵileleBiz 2010: South Pacific / Andrew Prelea (20)

More from RevistaBiz (20)

Advertisement

ƵileleBiz 2010: South Pacific / Andrew Prelea

  1. 1. RealEstateoverview2010
  2. 2. •The challenges of today’s market are a compounding effect of the last 4-5 years of rapid land, building cost and wage inflation that had no direct coloration with local demand and productivity markers. • Banks were lending at high valuations to individuals and investors alike that caused a great amount of paper wealth to be created in a short period of time. Challenges of today’s market
  3. 3. Challenges of today’s market • The result of all this is that we now have vast amounts of expensive leveraged land that has no potential of being exploited because the market simply cannot afford the prices that need to be obtained to breakeven on the land cost. • Theoretically we have a 1million home shortfall. • Banks do not want to touch residential development because they have too much legacy stock.
  4. 4. Challenges of today’s market • Investment funds and individuals are looking for high IRR’s that can rarely be achieved. • The banks are taking on a wait and see approach. • End buyers are still waiting for the market to fall further before they make a decision on buying a new home. • Consumer confidence is at a 20 year low.
  5. 5. Romania on the investment map again • At the end of this market correction/crisis developers will need to compete with the stock that is partially built or to be liquidated by current developers and banks. • We will have a 2-5 year period before we get traction in the market again without some form of government stimulation and positive consumer confidence that can only be achieved through a recovering economy.
  6. 6. • The Prima casa and 5% VAT threshold are only relevant to old buildings and stock that is going to be liquidated, but the reality is that there are very few newly constructed homes that fit into the criteria • As soon as you start to apply the 24% VAT to homes outside the threshold, they become cost prohibitive. Romania on the investment map again
  7. 7. Future projects and management strategy • We have adopted a new strategy focused on low cost housing for mass market, “the Dacia approach”. • To build affordable housing to people who are employed with a family income of 600-1000 Euro per month. • To produce the first mass market green housing, lowering the end users utility costs in excess of 50%.
  8. 8. Future projects and management strategy • Facilitate banking facilities for the end client to borrow up to 100%. • Provide the clients a 10 Euro per day repayment via a 30 year mortgage. • Be prepared for the implementation of the EU laws regarding energy efficiency. • All new developments will have amenities including: kitchen, parking, gardens, pools and playgrounds.
  9. 9. RealEstateoverview2010 Thank You

×