Romania: A… “renovated restaurant”

This article was published on Insight Tarom Magazine and on 26.01.2010 on the blog

Let us compare investing into Real Estate with eating at a "restaurant". After Romania left Communism behind, the venue was like an old, abandoned communistic "place to eat". Things improved, but really slowly. Only at the dawn of the new century the improvements started being noticeable, attracting more clients. So we could eat here, being sure that we will not be poisoned (lose our capital). While the country was moving forward, the connection to European Union boosted the interest of people (similar to say that the restaurant changed name, obtaining an international franchise brand). A new modern approach in several domains of economy and society was adopted (new equipment in the restaurant, better quality of ingredients).

While the rest of franchises around Europe were very expensive, the restaurant (Romania as investment destination) was a hot spot for 3 years, a "must", offering excellent food (properties), correctly priced, good service, nice atmosphere and also a very positive potential for the future.     Thenthings changed again. The restaurant became "extravagant", full of exaggerations. Most of the waiters became arrogant, interested only in tips, or how to collect more money with less work. You were lucky to find some serious ones, like in the past. The (overpriced) food was prepared badly, with awful quality of ingredients.

This mix would have caused major problems anyway, but the world economic crisis arrived and everyone found the perfect excuse! It was not the bad cook, but the crisis. Neither the bad waiter, nor the bad interior decoration, the poor variety and the very high prices. Just the crisis was the one to blame for the empty place. Clients left, people got fired, the surface shrinked, but the attitude of waiters just improved, slightly.

What do we need so as to move the market again and attract clients to this… restaurant, to the Romanian Real Estate market?

– More honesty – less greed
– More work – less promises
– More professionalism – less amateurism
– More respect to the client – less arrogance
– All these and many more, accompanied with a painful decision that we should all undertake: Sorry, but we will not become rich soon, without working.

Romania did not stop being a country with great potential, quite healthy macroeconomic figures, strategic geographical position, occupied by some of the most talented and innovative people in the world (when they want to). This country has plenty of virtues, which we need to redefine and bring up to surface again, as the competitive advantages which will attract investments, progress and better standards of life for everyone.

2010 is a challenging year indeed. Not because it seals our entrance to a new decade. This is the year when Romanian economy (and most probably Real Estate prices too) will reach bottom. With the expected measures of the new Government during the first months of the year, we should reach the lowest point some months later. This stability will allow us to benefit from the expected (not 100%) rise in Western Europe and be ready for better days, during 2011.

We all did mistakes in the past and most of us paid for them. Now we have the chance to start over again and set the foundation for the success of the years to come. If you are careful and serious, this year you can find a new "restaurant", renovated, friendly, with nice atmosphere and service. Variety of properties, properly priced (when you avoid the ghosts of the past). I also propose to you to reject all the ones who tricked you (or obviously tried it) in the past and focus on quality.

2010 is an excellent year for investments, restructures, new ideas. Romania has plenty of surprises for the careful investors. And this time the surprises will be positive…

PS. By the way, did you notice how many restaurants closed down during 2009? Did you think why?