The growth of modern retail is bringing tens of millions of euros to areas so far ignored by foreign investors. In Piatra Neamt, a town where modern retail made its presence felt for the first time at the beginning of this year, real estate developer GTC (Globe Trader Center) and the Town Hall intend to invest over 20 million euros in new modern retail units, which are scheduled to open in 2008.
The town, with 120,000-inhabitants in the North-East of the country, which has been the most overlooked region by foreign retailers due to the migrating population and low wages compared with the national average, will generate investments worth around 37 million euros in developing trade by 2009.
In addition, Israeli company Aura Investments, a partner of GTC, announced a residential project worth 18 million euros in Piatra Neamt. At the beginning of the year, the developer acquired land where it will build 180 apartments, after paying around 1.4 million euros.
Kaufland was the first international retailer to enter Neamt county, with investments worth 7 million euros in a 5,000 square-metre hypermarket, even though official statistics placed Neamt county last in the national ranking in terms of the population's average income. Officials of the German retailer defended their decision to enter the Piatra Neamt market because of the gap between official statistics and the population's actual incomes, and decided to rely on the lack of competition in the area, and the size of the market (i.e. the number of consumers).
"Many Piatra Neamt inhabitants go to Iasi or Suceava to do their shopping," says Andrei Ciubotaru, the architect of the mall built by the Town Hall in Piatra Neamt, who highlights the market's potential. He estimates investments in this project will stand at over 7 million euros, whilst the mall will cover a total area of 10,000 square metre
