New law blocks GTC to develop the mall on its plot in Pipera
GTC declares that the mall Galleria Bucharest can no longer be developed, following a decision taken in March by the authorities which forbids the use of the land classified as green area and the company lost EUR 15.2 million, two thirds of the property value.
„On 12th of March, the Deputies Chamber in Romania approved a decision that states that it is no longer permitted to use for other purposes any land that is currently classified as green area. The actual law does not allow GTC Group to build on its Bucharest plot where the company intended to develop Galleria Bucharest, as the land is classified as green area. As a result, the company lost EUR 15.2 million“, the quarterly report of the company showed.
The plot with 12.3 ha was evaluated by the company at EUR 22 million at the end of 2012. GTC intended to develop 54,000 sq. m mall but couldn’t receive the construction permit. The land is situated in Petricani area, in the area of the planned connection to the Bucharest-Ploiesti highway.
The report also shows that the value of City Gate office complex from Piaţa Presei in Bucharest has decreased with EUR 7.7 million compared to the end of last year, to EUR 161 million. The average rent in the office complex with an area of 47,000 sq. m and 95% occupancy rate is EUR 22/sq. m/month.
The commercial centre Galleria Arad was evaluated at EUR 31 million, same as in December 2012. The mall has 32,000 sq. m rentable area and an occupancy rate of 97%. The average rent is EUR 5/sq. m / month.
GTC owns in Romania another three commercial centres, Galleria Piatra-Neamţ, Galleria Suceava and Galleria Buzău, evaluated at EUR 7 million, available for sale. The developer obtained last year EUR 8.4 million total revenues in Romania and Bulgaria, compared to EUR 6 million in 2012
GTC also owns in Bucharest two residential complexes, Rose Garden and Felicity. The company also plans the development of new projects, both residential and office, all in Bucharest. GTC partnered with the businessman George Copos for the development of the office complex near Piaţa Presei in Bucureşti, but the construction was delayed because of the financing lack. (source: zf.ro)