Cushman & Wakefield Echinox: Office operating costs in Bucharest rose by around 17% in 2025

Office operating costs in Bucharest increased by approximately 17% in 2025, driven by inflation, rising labour expenses and changes in fiscal policy, according to an analysis by Cushman & Wakefield Echinox.

Operating costs represent expenses charged to tenants in addition to base rent and include property tax, technical maintenance, insurance, cleaning, security, internet services and property management. Property taxes account for the largest component of these costs and can represent up to 50% of total operating expenses.

According to the consultancy, high inflation has had a broad impact across nearly all cost categories, from utilities and materials to specialised services. Personnel costs also increased following a 9.46% rise in the minimum wage, which directly affected service providers, particularly in cleaning and security. At the same time, higher occupancy levels in offices—exceeding 50% in most cases and reaching full occupancy in some buildings—led to increased consumption of materials and greater staffing requirements.

Maria-Raluca Mihai, Director Property Management at Cushman & Wakefield Echinox, said: “Operational costs have remained the main challenge in office building management. In 2025, the rise in service and material prices, together with the increasing number of employees returning to office, put pressure on budgets. A proactive approach from property management teams continues to be essential for maintaining the competitiveness of buildings.”

She added: “When managing costs, it is crucial to have tools that can process financial information quickly and accurately, so that optimisation decisions can be made without delay. The global economy is currently affected by unpredictable factors, and digitalisation remains the solution for organisations to keep pace and adapt efficiently.”

Additional pressure has come from higher maintenance and repair costs for HVAC systems, rising insurance premiums and increased VAT, which was raised to 21%. Anticipated tax increases in 2026 are also expected to affect operating budgets for both tenants and property owners.

The consultancy’s findings are supported by the fourth edition of the Real Estate Investors Sentiment Barometer conducted by Cushman & Wakefield Echinox. In the latest survey, 51% of investors identified optimal management of operating costs as the main challenge in managing their property portfolios, up from 39% in 2024. A further 28% cited the complexity of legislative regulations as a key concern.

When asked about trends expected to have the greatest influence on commercial property management services, investors pointed primarily to tenant experience and behaviour, mentioned by 48% of respondents, compared with 36% in 2024. Technology and digitalisation ranked second, cited by 30% of respondents.

In response to rising costs, Cushman & Wakefield Echinox highlights several market practices aimed at improving efficiency. These include organising regular tenders for service contracts, typically every 18 months, consolidating services under single providers to achieve volume discounts, and implementing energy-efficiency measures such as LED lighting, motion sensors, optimised HVAC scheduling and upgraded building management systems.

The consultancy also notes that structured maintenance planning can reduce the risk of costly repairs, while clear and well-documented service charge reconciliations allow tenants to better understand and track operating expenses.

Bucharest land transactions decline in 2025 as developers focus on prime locations

The volume of land transactions in Bucharest fell by 13.4% in 2025 compared with the previous year, marking the lowest level recorded in the past seven years, according to data compiled by Crosspoint Real Estate, the international associate of Savills in Romania.

The decline reflects a combination of factors, including the increasingly limited availability of land within the city and rising development costs. Another key driver has been the maturation of the residential sector, which remains the main source of demand for land in Bucharest. This shift is also evident in the residential sales market, where volumes have stabilised since 2024 following a peak in late 2023, pointing to demand driven more by end users than by speculative investment or low-cost financing.

According to Crosspoint, recent data indicate that the residential market has become more selective. “The market is no longer characterised by speculative volumes,” said Ionuț Stan, Partner and Head of Land Development at Crosspoint Real Estate. He noted that developers are increasingly competing for well-located plots that can support pricing acceptable to more informed buyers, reflecting a transition towards a replacement and upgrade market with greater long-term stability.

Crosspoint’s analysis shows that enthusiasm for apartment purchases eased in the second half of 2025, reinforcing the trend toward market maturity. As a result, developers are placing greater emphasis on product quality, which in turn has increased the importance of land characteristics such as location, planning status and surrounding infrastructure.

Ilinca Timofte, Head of Research at Crosspoint Real Estate, said that many of the larger land transactions in 2025 involved smaller plots than in previous years, but were concentrated in key areas of Bucharest. In some central locations, land prices per square metre reached record levels, reflecting strong competition for scarce, well-positioned sites.

One of the notable transactions illustrating this trend was the acquisition by Cordia Romania of an 8,179 sq m plot near Bucharest Mall and Alba Iulia Square, completed in September 2025. The land was acquired from Bog’Art Place and already benefited from an approved building permit. Cordia has since begun construction of the Centropolitan project, which will include 274 apartments and 3,345 sq m of retail space.

Crosspoint advised Cordia on the transaction, which ranks among the largest land deals recorded on the Romanian market in 2025. According to Mihai Dumitrescu, co-founder of Crosspoint Real Estate, the deal highlights developers’ preference for plots with established urban planning documentation, proximity to public transport and access to key services. He added that Crosspoint’s total land transaction portfolio in 2025 amounted to approximately 100,000 sq m.

Looking ahead, Crosspoint expects that higher land prices, limited availability of plots with approved planning documentation and increased taxation on residential properties held by commercial entities will reduce the attractiveness of apartments as pure investment products. In the medium term, this is likely to encourage a more cautious approach among residential developers and extend the time required to secure suitable land, as acquisition costs need to align more closely with current market conditions.

Skanska divests the office building Equilibrium 2 in Bucharest, Romania, for EUR 37M, about SEK 400M

Skanska has divested the second phase of the Equilibrium office complex in Bucharest, Romania, for EUR 37M, about SEK 400M. The buyer is Magyar Posta Takarék Real Estate Investment Fund, managed by Gránit Asset Management. The transaction will be recorded by Skanska Commercial Development Europe in the first quarter of 2026. The transfer of the property is scheduled for the first quarter of 2026.

The second building, completed in the fourth quarter of 2022, offers approximately 20,000 square meters of premium leasable office space across eleven floors. It is distinguished by its forward-looking approach to sustainability, inclusive design and digital connectivity, validated by LEED Platinum, Access4you Silver and WiredScore Platinum certifications. The building is almost 50 percent leased.

The office complex, which consists of two phases, has become a landmark in the Northern part of the capital, being located right at the entrance to the most vibrant office submarket, Floreasca-Barbu Vacarescu, often called the new Central Business District in Bucharest. It offers 3,500 square meters of accessible green space, sustainable solutions, and is designed to focus on flexibility.

The first building of the complex, delivered in 2019, was sold in April 2025 to Gordiusz Private Equity Fund, managed by Gránit Asset Management.

LIP Invest acquires logistics property near Dresden for institutional fund

LIP Invest has acquired a transshipment logistics property in Thiendorf, near Dresden, for the LIP Real Estate Investment Fund – Logistics Real Estate V, which is managed by INTREAL. The asset was purchased off market from the Bremen-based developer and investor Peper & Söhne.

The transaction was supported by REIUS (legal advice), Forvis Mazars (tax advice), Mocuntia (technical due diligence) and Enviro Sustain (ESG due diligence).

The property, completed in 2024, provides approximately 11,400 sq m of total lettable area, including around 9,000 sq m of warehouse space. It is designed for high-throughput logistics operations, with loading access on all four sides via 83 dock levellers, one ground-level gate and 16 sectional gates for vans.

The building meets current construction and sustainability standards. A photovoltaic system is installed on the warehouse roof, while the associated office, gatehouse and technical annex feature green roofs. The property is equipped with building automation systems, offers charging infrastructure for cars, vans, trucks and bicycles, and has been awarded DGNB Gold certification.

Hermes Germany signs long-term lease

The property is fully leased on a long-term basis to Hermes Germany GmbH, which operates the facility as a regional transshipment depot. The site has created around 90 new jobs and is equipped with a sorting system capable of handling more than 200,000 parcels per day. Approval for 24/7 operations allows for continuous parcel processing.

Strategic location in Saxony

The logistics facility is located in Thiendorf, north of Dresden, within the region often referred to as “Silicon Saxony”. The site benefits from direct access to the A13 motorway towards Berlin and the A4 east–west corridor, positioning it as a distribution hub for eastern Germany and neighbouring Central and Eastern European markets. Additional transport options are supported by proximity to Dresden Airport, the local freight village (GVZ) and the Port of Dresden.

Photo: Logistics property near Dresden. Copyright: Goldbeck

Skanska and Entra to develop office project in central Oslo

Skanska and Entra have agreed to jointly develop an office project at Christian Krohgs gate 2 in Oslo through a 50/50 joint venture. The total investment volume for the project is approximately NOK 1.8 billion (around SEK 1.7 billion).

Skanska will carry out the construction works under a contract valued at around NOK 900 million (approximately SEK 830 million). The contract will be included in Skanska’s Nordic order bookings for the first quarter of 2026.

The project involves the redevelopment and expansion of existing office and commercial buildings, providing a total lettable area of approximately 21,200 sq m. The property is located close to Oslo Central Station and is intended to offer modern, flexible office space with strong access to public transport.

The development targets a BREEAM-NOR v6.0 certification at the “Very Good” level and includes plans for a fossil-free construction site. The partners also aim to reduce greenhouse gas emissions from construction materials compared with a reference building, increase material reuse, minimise waste volumes and achieve energy class A through efficient energy solutions.

Construction is scheduled to start in the second quarter of 2026, with completion expected around the end of 2029 or early 2030.

Zeitraum marks 10 years on the Czech market

Zeitraum, an operator of student accommodation and serviced apartments, has marked ten years of activity in the Czech Republic. Over the past decade, the company has expanded its portfolio to include student residences and serviced apartments in the Czech Republic and Poland.

Zeitraum currently operates three apartment buildings in Prague and Pilsen, as well as four student residential buildings in Prague districts 3, 7 and 8. Outside the Czech Republic, the company operates two student buildings in Krakow and one in Warsaw. Across both countries, its portfolio comprises ten properties with a total capacity exceeding 2,000 beds.

According to the company, Zeitraum plans to expand into additional university cities in the Czech Republic and abroad, with a target to add between 700 and 1,000 beds over the next three years.

Zeitraum entered the market with a focus on privately operated student housing offering fixed-price rents, shared services and flexible lease terms. Its student residences provide furnished rooms and apartments, common facilities such as study and leisure areas, 24-hour reception services and utilities included in the rent. The concept has since been complemented by serviced apartments aimed at short- and long-term stays.

Under the Zeitraum Apartments brand, the company operates three aparthotel properties: Franz by Zeitraum and Karl by Zeitraum in central Prague, and Zeitraum Kotkova in Pilsen. These units are targeted at tourists, business travellers and longer-term guests, offering fully equipped apartments with hotel-style services.

The company reports full occupancy across its student housing portfolio for the upcoming academic year, with bookings made several months in advance. It also notes increasing demand for serviced apartments from both individual and corporate clients in the Czech Republic and Poland.

Zeitraum states that its future strategy focuses on further geographic expansion while continuing to develop services at its existing locations.

Sonar acquires ‘Australhaus’ office property in Hamburg for institutional investor

Sonar Real Estate has acquired the ‘Australhaus’ property in Hamburg on behalf of a special fund managed for a German institutional investor. Sonar acted as investment and asset manager for the vehicle, which is administered by Institutional Investment Partners.

The listed five-storey building was completed in 1906 and modernised in 2015. It offers a total rental area of approximately 1,600 sq m, of which around 60% is used for office and medical practice space. The remaining area comprises retail and storage space. Current tenants include the Italian fashion brand Boggi Milano on the ground floor and a dental practice. Existing vacancy totals roughly 600 sq m of office or practice space and about 150 sq m of retail space.

Australhaus is located on Poststraße in Hamburg’s city centre, within the arcade district between Gänsemarkt and Rathausmarkt. The property benefits from access to the city’s public transport network via the nearby Jungfernstieg and Gänsemarkt stations.

According to Matthias Gerloff, Managing Partner at Sonar Real Estate responsible for German institutional business, the acquisition aligns with a long-term investment strategy and offers scope for income and value enhancement through active asset management.

Legal advice for the transaction was provided by Jebens Mensching PartG mbB, while technical and environmental due diligence was carried out by TA Europe. CBRE acted as broker, and JLL provided commercial advice to the buyer.

Worldbox opens store at Auchan Legnica Shopping Centre

The Auchan Legnica Shopping Centre has added a new tenant with the opening of a Worldbox store occupying more than 450 sq m. The retail space offers clothing, footwear and accessories from a range of sports and casual brands.

The shopping centre is managed and commercialised by Nhood Services Poland, which is responsible for tenant relations and the ongoing development of the centre’s retail mix.

The Worldbox store opened in December 2025 and operates as a multi-brand concept focused on athleisure and everyday sportswear. Its assortment includes products for women, men and children from brands such as Adidas, Puma, Reebok, Kappa, Hunter, DC and Beverly Hills Polo Club.

Operating for more than 20 years, Auchan Legnica Shopping Centre serves residents of Legnica and the surrounding area. In addition to fashion and footwear, the centre’s tenant mix includes health and beauty, pet supplies and service outlets. An Auchan hypermarket operates on site, while a Decathlon store is located nearby.

Lukoil agrees to sell international assets to Carlyle Group

Lukoil has signed an agreement to sell its international assets to the U.S. investment firm The Carlyle Group, the Russian oil producer announced on its website on 29 January 2026. The transaction excludes Lukoil’s assets in Kazakhstan, which will remain under the company’s ownership.

The value of the deal has not been disclosed. According to Carlyle, completion of the transaction is subject to the outcome of an internal audit and approval by the U.S. authorities, as reported by Reuters.

The sale follows international sanctions imposed on Russia’s energy sector after the invasion of Ukraine. In October 2025, the United States added Lukoil to its sanctions list, a move that accelerated the company’s efforts to divest assets outside Russia.

Lukoil’s foreign operations are managed through Lukoil International GmbH, based in Vienna. The unit controls refineries in Europe, stakes in oil fields in countries including Uzbekistan, Iraq and Mexico, as well as a network of hundreds of fuel stations worldwide. Including the assets in Kazakhstan, the total value of Lukoil’s international portfolio has previously been estimated at around USD 22 billion.

Carlyle stated that its priority following the acquisition would be to ensure continuity of operations, protect jobs and stabilise the assets. The firm added that it intends to oversee the portfolio to support safe and reliable operations.

Interest in Lukoil’s international assets has been reported for several months. In October, the company accepted an offer from Swiss-based Gunvor, which was later withdrawn. Other potential buyers mentioned in media reports included Hungary’s MOL Group and Austrian investor Bernd Bergmair.

While Lukoil and other major Russian energy companies were added to the U.S. sanctions list in October, some restrictions affecting Lukoil were partially suspended in December. The exemption was intended to allow fuel stations outside Russia to continue operating, provided that revenues do not flow back to Russia. This waiver is valid until 29 April 2026.

Lukoil previously operated a network of fuel stations in the Czech Republic, which was sold to Hungary’s MOL Group in 2014.

Source: CTK

Poland’s real estate investment volume declines in 2025 despite stable activity

Poland’s commercial real estate investment market recorded a total transaction volume of €4.5 billion in 2025, representing a year-on-year decline of 13% compared with 2024. Market liquidity, however, remained stable, with 151 transactions completed during the year, broadly in line with the 154 deals recorded in the previous year.

According to market data compiled by Avison Young, the lower investment volume reflected the continued absence of large institutional capital rather than a contraction in market activity. While 2024 marked a return to relative stability following several challenging years and a sharp slowdown in 2023, the recovery in 2025 was characterised by a higher number of mid-sized transactions rather than landmark deals.

More than 40% of the annual investment volume was recorded in the fourth quarter. Unlike 2024, when the ten largest transactions accounted for nearly half of total turnover, 2025 was defined by a broader spread of smaller deals. Several larger transactions initiated during the year are expected to close in early 2026.

Domestic investors increased their presence in the market, accounting for 18% of total investment volume in 2025, up from 9% a year earlier. This trend was visible across multiple sectors, particularly offices and smaller-format assets.

Office sector leads investment activity

The office sector was the largest contributor to investment volumes in 2025, accounting for approximately 40% of total turnover, equivalent to €1.8 billion, up 7% year on year. Most activity was concentrated in Warsaw, which accounted for 30 of the 51 office transactions completed during the year.

After strong interest in value-add and opportunistic office assets in 2023, investment activity in 2024 and 2025 shifted towards core and core-plus properties, reflecting market repricing and closer alignment between asking prices and achievable transaction values. Demand also remained for older office buildings with redevelopment or conversion potential, particularly among domestic buyers targeting smaller assets.

Major office transactions exceeding €100 million included the acquisition by Mennica Polska of a 50% stake in Mennica Legacy Tower, the sale of Wola Center to Trigea Real Estate Fund, and the repurchase of a 49% stake in a CPI portfolio, which represented more than a quarter of the sector’s total investment volume. Other notable transactions involved office buildings in Warsaw, Kraków and Wrocław.

Domestic capital accounted for around 30% of office investment volume and half of all office transactions, reflecting a growing focus on value-add opportunities outside the residential sector.

Industrial market remains resilient

The industrial and logistics sector maintained a stable position in 2025, building on its strong performance during the more challenging market conditions of 2023. Total investment volume reached approximately €1.5 billion, up 10% year on year.

Activity was supported by continued interest in sale-and-leaseback transactions and increasing investor focus on secondary logistics locations, which accounted for nearly 40% of industrial investment volume. Only two transactions exceeded €100 million, including a landmark sale-and-leaseback deal involving two Eko-Okna properties acquired by Realty Income. This transaction was the largest sale-and-leaseback deal completed in the CEE region to date.

Market participants report a strong pipeline of industrial transactions, with expectations that narrowing pricing gaps and renewed foreign capital inflows could support higher volumes in 2026.

Retail investment shifts towards parks and convenience formats

Retail investment accounted for close to 20% of total transaction volume in 2025, down from 32% in 2024. Total retail investment volume reached €859 million, representing a year-on-year decline of nearly 50%.

The reduction was largely due to the absence of prime shopping centre transactions, which had driven volumes in the previous year. Instead, activity focused on retail parks and convenience retail, which accounted for around 70% of completed deals. Two major portfolio transactions dominated the sector, including the sale of 25 retail parks by Trei Real Estate to Ares Management Corporation and Slate Asset Management.

Another significant transaction was the acquisition of Galeria Libero in Katowice by Summus Capital, one of only two retail deals exceeding €100 million in 2025. Market participants expect further activity in retail parks and well-positioned shopping centres with stable fundamentals.

Living and PRS sector moves toward a milestone

Investment in Poland’s living sector reached €223 million in 2025. Around €150 million was allocated to three PRS (private rented sector) projects in Warsaw, including two transactions completed by AFI Europe and one acquisition by Xior Student Housing. Additional activity included co-living assets in Gdańsk acquired by Urban Partners.

A major PRS transaction announced in 2025, involving the planned acquisition by Vantage Development of 18 Resi4Rent assets, is expected to represent a milestone for the sector once completed. The deal would account for more than 20% of Poland’s operational PRS stock and signals growing interest from both domestic and international investors.

Outlook for 2026

Poland is expected to remain an attractive investment destination in 2026, supported by solid economic fundamentals. Market participants anticipate that interest rate cuts in the eurozone and Poland, combined with potential geopolitical stabilisation, could encourage the return of larger institutional investors.

Domestic capital is expected to remain active, particularly in small and mid-sized assets offering higher returns or value-add potential. Continued interest is also expected from regional investors across Central and Eastern Europe, as well as from Western European capital.

Several transactions launched in 2025 are scheduled to close in early 2026, suggesting a more dynamic start to the year. The office sector is expected to remain active, while retail parks and convenience formats are likely to continue driving retail investment. The industrial sector, which has shown consistent resilience, is also projected to improve its performance further in the year ahead.

SOURCE: Avison Young

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