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Real Esatate: OTP Bank Romania: the volume of financing for real estate projects, almost double in 2018
In 2018, OTP Bank Romania recorded a significant increase in the volume of corporate finance in real estate sector by 43.8%, compared to 2017. The evolution was due to the increased appetite of real estate developers, especially for office buildings, which resulted in an increased demand for financing in the real estate industry.
The financing granted by OTP Bank Romania in 2018 was for residential projects, office buildings (development of new buildings, but also modernization of existing buildings) as well as for logistics and commercial spaces.
The average amount of funding for real estate projects varies depending on the type of project. Thus, for office buildings, the average was EUR 12 million per project, and for residential buildings the average loan was EUR 5.5 million per project. The highest funding granted in 2018 was EUR 15 million for the development of a commercial space in Bucharest, amount added to a loan previously granted.
“The real estate market in Romania is constantly expanding, identifying interest especially in the development of office, logistics and residential projects. We believe that the appetite of real estate investors will be maintained in 2019, and OTP Bank Romania is prepared with financing tailored to the needs of the market. We are pleased that we can contribute to the sustainable development of the local economy by supporting medium and long-term projects”, said Drago? Miric?, Deputy CEO, Head of Corporate Banking Division and Member of the Management board of OTP Bank Romania.
In 2018, most investments were directed to the Capital City, with 52% of the total volume of financing being accessed by real estate developers in Bucharest. The other loans were for developers in Sibiu (19%), Oradea (18%), Drobeta -Turnu Severin (5%) and Cluj-Napoca (2.6%). The geographic distribution is similar to the previous year: Bucharest – 69%, Sibiu- 17%, Constanta – 7%, Oradea – 6%.