McDonald’s to buy 2,000 sq. m plot of land in Craiova from the City Hall
McDonald’s, the biggest player on the local restaurants market, with a turnover of EUR 94 million in 2011, will buy from Craiova City Hall a plot of land of nearly 2,000 sq. m, where its restaurant is located for more than 10 years.
Since entering the market, the company has focused on renting plots from the town halls, so that currently the company has less than 10 owned plots for a network of over 60 units. According to ZF information, the rent varies between 2,000 and 2,500 euros per month, meaning 24,000 to 30,000 euros annually. For a turnover of EUR 2-3 million, the rent share from the total business of a restaurant is less than 1%. For the fashion and IT retailers, the share of the rent from the turnover is more than 5%.
The American group decision for buying the plot in Craiova comes in a period when the prices of the land decreased on the background of the financial crises, a reason for the companies to start buying the locations of their rent. McDonald’s did not respond to ZF questions about this transaction or the rent paid for the rented premises.
The City Hall representatives said that the starting price of the negotiation will be set according the evaluation report to be submitted to the Local Council of Craiova. According to ZF estimations based on the market information, the plot in 26 Calea Bucureşti, could value between 600,000 and 800,000 euros with an average price of 300-400 euro/sq. m.. This amount represents the equivalent of 20-25 years rent according to ZF calculations. (source: zf.ro)