Dan Ioan Popp, the main shareholder in Impact real estate developer with 32m-euro market capitalisation, describes 2009 as a "painful year", during which Romanian entrepreneurs remained on a market where almost nothing sold, while foreigners abandoned domestic projects.
"We witnessed the departure of foreigners, who held 25-30%, maybe even 40% of the market, which angered us. They ebbed out after they flowed in," says Popp, who considers new apartment prices dropped by around 20% from the highs of 2008, now standing at the level of 2006.
Popp, Valentin Visoiu (Conarg), Negoita brothers or Ion Avram (Can Serv) are among the Romanian entrepreneurs who have built the highest number of housing units after the revolution, with Impact owner holding more than 1,000 finalised units in his portfolio. In the past two years, the real estate market has turned from a driver of the economy into one of the hardest hit fields, with declines of above 50% and with no major housing project started in 2009.
Impact turnover in the first nine months of last year contracted by 62% year-on-year, to a level of 41.4m RON (around 10m euros), while the company's income went down from 16.8m RON (4m euros) to 0.79m RON (200,000 euros) during the same interval.
Dan Ioan Popp believes the entire economy is hindered by the high borrowing costs. "Banks should now have zero interests. A year from now, we'll see, but the longer interest rates are kept high, the more banks are standing to lose. (...) Unfortunately, it is banks' shareholders, and not bankers that are deciding now on interests. And now, 98% of the banking system is no longer in Romanians' hands. Banks must be saddled," Popp stated.
Impact's most important project now is being carried out on a 60-hectare plot of land of Baneasa district, in northern Bucharest, on which more than 2,000 housing units should be b
