IASI REAL ESTATE OVERVIEW

Iasi is a city of historical and cultural significance to Romania, the informal capital of the Northeast region. The University of “Alexandru Ioan Cuza” in Iasi is the first higher education institution registered in modern Romania. The educational system of Iasi nurtures more than 55,000 domestic and international students. The strong base of an educated workforce attracted dozens of reputable multinational companies. One of the first believers in Iasi was Amazon, who opened its first R&D Center in Eastern Europe before Romania was part of the EU, in 2005. Dozens of reputable multinational companies followed, transforming Iasi in Romania’s Silicon Valley.

“The United Business Center story started in 2010, with a 7,000 sqm building, two partner companies, and 70 employees. 13 years later, with the opening of Palas Campus, the largest office building in Romania, we have consolidated in downtown Iași the largest office, innovation, and creativity hub outside the Capital, which now includes 130,000 sqm, 8 buildings, 70 partner companies, and 14,000 employees. This dynamic proves that Iași is a strong player in the expansion and development plans of creative industry giants, tapping the potential of young specialists trained in the local universities.” Ionut Pavel, Office Buildings Manager, Palas Iasi.

The city is weak in terms of new, modern housing units. Data collected by RPC from imobiliare.ro show that offers for the first 3 quarters in 2023 total 1,275 apartments, of which the new units listed count for 410, a minus of 18% as compared to the same period of the previous year. Impact Developer & Contractor obtained the building permit for a major residential scheme totaling 1,062 apartments on Copou hill.

Regarding the retail sector, 20.000 sqm will be added to the existing 170,000 sqm stock, A proof for the high potential of the city is the announcement of Ikea to inaugurate a store in Iasi, the third city after Bucharest and Timisoara. “Palas Iași is one of the strongest retail hubs in Romania. For the first 9 months we registered more than 16.2 million visitors, managed to supplement the leasable area by approximately 4,000 sqm, brought in new retailers such as Peek & Cloppenburg, Hugo Boss, Obsentum, Intimissimi, and Calzedonia, and our sales exceeded last year’s figures.” Gabriel Iatco, Shopping Center Manager, Palas Iasi.

The broader Northeast region is the least developed in terms of industrial and logistics, representing a mere 2% of the total modern stock (130,000 sq m), out of which 43,000 sq m is located in Iasi. The vacancy rate is slightly above the market equilibrium level (11%); however, investors placed faith and are building an additional 17,500 sq m of Class A facilities. The long-awaited A7 highway construction places great hopes for future developments, as more accessible transportation to Bucharest is finally coming live.

In the last 10 years, although Iasi hotel tourist arrivals increased by 105% (around 156,000 new tourists), the number of new hotel rooms increased by only 11%. Branded hotels represent only 12% of total rooms capacity and all of them are within “3-star” ranking. There are no 4* or 5* branded hotels in Iasi. “Iasi international airport is a regional hub for local county and Republic of Moldova. Due to shortage of hotel rooms in the market, all major international hotel chains (ie.: Hilton, Marriott, IHG, ACCOR, Radisson) are strategically looking to expand with new hotels in Iasi city”, Mircea Draghici, Managing Partner, Est Hospitality.