Having posted €70 mln in net profits in the first nine months of 2023, One United Properties is considering entering new European markets to replicate a business model which has proved successful in its home country, Romania.
A listed real estate developer focused on Bucharest, One United Properties develops high-end residential apartments for sale in city-centre locations in the Romanian capital.
The company was founded during the global financial crisis to take advantage of development opportunities emerging from the credit squeeze by two businessmen, Victor Capitanu and Andrei Diaconescu. It has since expanded to new segments such as offices and retail and carried out a number of capital raisings including an Initial Public Offering on the Bucharest stock exchange in 2021, to finance its development drive in the capital city.
Capitanu and Diaconescu together hold 56% of the company’s shares, with the remaining capital held by some 9,000 shareholders.
‘We have analysed other locations and we are looking to expand our business in other cities in Romania and more likely outside of the country,’ Capitanu tells PropertyEU in an interview.
‘To decide which country, we are evaluating fundamentals like population growth and supply levels,' he adds.
2023 has been an exceptional year for the company’s business, he notes. ‘We are a high-quality developer and we have benefited from a general flight to quality trend in the residential property sector. Although the Romanian real estate market is not in great shape at the moment – sales are down by 20% year-on-year - we managed to double our business and we sold three times as many apartments in the first nine months of 2023, versus the same period of 2022.’
In the first nine months of 2023, One United Properties sold and pre-sold 795 apartments, up 206% on the same period a year earlier. In line with its strategy to develop environmentally-sustainable buildings, the company fits residential developments with geothermal heat pumps and its developments are 100% Green Homes certified. ‘We are on track to deliver nearly 1,500 residential units this year,’ says Capitanu.
Although the company derives most of its profits from the development business, it also holds a number of offices such as the fully-let One Tower, One Victoriei Plaza and the One Cotroceni Park mixed-use development. One United Properties acquired the One Cotroceni Park plot of land in 2019 from Immofinanz. A former abandoned industrial platform located close to the Presidential Palace, One Cotroceni Park is built on over 5.6 hectares of land, and is part of a larger development, One Cotroceni City, which will cover an area of 10 hectares, and will be the largest urban regeneration development in Bucharest. ‘I think a developer that has enough balance sheet to be also an investor has a much more powerful position in the market,’ Capitanu comments.
While offices have contributed strongly to the company’s success, Capitanu believes the best returns and opportunities remain in residential development over the next few years. ‘Competition is not so strong and we have secured a major land bank for development which we believe will generate around €1 bn of profits over the next few years.’
The acquisition of the land plots was done entirely with the company’s own cash, he adds, allowing for a strong return on equity in the future.
