Amsterdam-headquartered NEPI Rockcastle, the premier owner and operator of shopping centres in Central and Eastern Europe (CEE), is considering opening a hotel in the extension of Promenada mall, in northern Bucharest.
The investor has been working for several years on the expansion of the mall. NEPI is now analyzing the construction of a four-star business hotel with about 200 rooms, occupying two and a half floors of the new building.
Currently, the mall, which was developed by Raiffesien Evolution and is known for its contemporary architecture, features a leasable area of 39,300 sqm, it is valued at 201 million euros and generated rents of 14.5 million euros in 2023. The expansion, a 282 million euro investment will bring an additional 55,400 sqm of leasable space. Works on the seven-level underground parking have been completed and have reached the superstructure.
“Initially, we thought of doing only office spaces, but now we are also analyzing the option with a hotel, to diversify the functions and for the needs of the area,” Adrian Boca, Project Manager Development at NEPI Rockcastle, told a press conference in Bucharest.
NEPI Rockcastle achieved a 12.3% growth in net operating income to €411 million in the first nine months of 2024 versus the same period of 2023. On a like-for-like basis, NOI increased by 8.4%. The continuing momentum in the company’s growth was driven by higher rents and short-term income as well as the disciplined management of operating costs. Tenant sales increased by 9.0% in 9M 2024 versus the same period a year ago (LFL excluding hypermarkets), in line with the trend at half year. Footfall was up by 1.4% (LFL), while the average basket size increased by 8.3% despite inflation de-accelerating significantly since 2023.
Rüdiger Dany, NEPI Rockcastle CEO (Image credit: NEPI Rockcastle)
Rüdiger Dany, NEPI Rockcastle’s CEO, said: “We continue to see solid growth across our markets, driven by strong tenant performance and the impact of active asset management. The average basket size continued to grow through the third quarter at roughly the same pace as in the first half of the year.”
Development projects under construction (the extension of Promenada Bucharest, the redevelopment of Bonarka City Center and the refurbishment of Arena Mall Budapest) are on schedule and within budget, the company said.
NEPI is also set to build over 400 apartments next year. The company is in the process of authorizing the next two residential projects, one in the city of Brasov, with 300 apartments, and one in Craiova which will have 136 apartments. Last year, NEPI opened its €136 million Promenada Craiova shopping centre in central southern Romania. The new residential project in Craiova will be next to the mall, Boca explained.
NEPI Rockcastle’s shares are listed on the Johannesburg Stock Exchange, Euronext Amsterdam and South Africa’s A2X. The Group voluntarily distributes at least 90% of its distributable earnings on a semi-annual basis.
NEPI Rockcastle at a Glance
Founded: 2007 Headquarters: Amsterdam, Netherlands Property Portfolio: 59 properties in 8 countries Value of investment property in use: €7.1 bn (as at October 2024)
