"George Prelea how would you describe the Romanian resources and potentials? Romania used to be quite a rich country in the region. It is low now because everybody became a businessman. Peasants sold their land and got resources for development. Romania used to be Europe's granary. Only Ukraine had larger areas with wheat and corn than Romania. Half of Europe was fed from Romania. This will come back. Romania is a country that offers a lot of opportunities. Major companies like Coca-Cola and Philips established really fast here. They are successful and steady. They employ a lot of people and have the possibility to make a solid buck in a fairly reasonable time compared to the Western country, but not a very quick one. The country will come out from this crisis through imagination and through the resources that are not yet used but that exist. The first investors that came in the country after the fall of communism were ex-Romanians and this was also similar in Russia. How do you characterize the real estate market and how will it evolve? At the moment, the drop in speculation in real estate made the market crazy. A piece of property in Bucharest was more expensive than in Paris. It was quick money. The positive effect of the crisis is that probably 80 percent of non-professionals have disappeared from the market, starting with the real estate. Land prices went down and banks are no longer lending any money. Instead of lending money to the local businesses and people banks started to lend money to the government to secure loans. If the government stops borrowing money from the banks, they will have to redirect the money to finance constructions and other markets. Now the market is slowly starting to rebuild itself. After researching the market, we have turned completely from building traditional homes to building only ecological panels. They are much cheaper and eco-friendly and are regenerating energy. These materials were tested by the governance authority in the field and it was found out they resist more than bricks, at winds of 180 miles per hour. They also tested our pieces of wall by putting a 40 tons pressure on it. It didn't move. They verified to see if we didn't insert steel. There wasn't any and they couldn't believe their eyes. People are always reluctant to accept new things. There is a mentality of lack of responsibility Romanians still have after they inherited from the communist system. How do you find this mentality of lack of responsibility � as a Romanian working with Romanians but coming from an international background? It is very difficult. We brought for instance several managers from Australia as heads of departments to train people. You find extremely capable, knowledgeable and hard working people here. Still, there biggest deficit is in this field of responsibility in managerial positions. What Romania lacks and will still lack is the work ethics. There are many people having high salaries but what we don't do is paying on performance. This is a strange concept. We are slowly implementing this approach. It's the only way to extract the maximum from the people. It's just a natural progression. I used to be thrown out from any education institution of the Socialist Republic of Romania. It was actually physical. I couldn't help myself of making fun of the regime. In Australia I arrived on a Sunday, I committed the crime of turning several yellow pages. I went to look for a job on Monday and I got ten offers. Tuesday I started working. I specialized in air conditioning design and it was a tremendous demand for these products. You could learn the profession only in US or Canada. Now you can learn it anywhere. In three months I was in charge of a team of five people. Three years later I was chief engineer in this company designing air conditioning machines. My father used to say that if you are a street sweeper you should be the best street sweeper. How would you summarize your personal philosophy? Every day is a new day or each day is the first day of your life. I've never been jealous, instead I always looked up at people who realized something or made something larger than life. If you want to succeed, we all have at least one weak point. It's your ability of discovering the weaker points that will give you an upper hand. See what turns people on or off. Spend a little bit of time on that. We all have one. I can't be sad and I refuse to be furious. I went through several financial crashes. In 1989-1990 I lost 6.5 million dollars. Twenty years of work, meaning all my money, I put in only one building. It plunged like that. I started from the beginning having only 9.57 dollars in my pocket. Your company is called South Pacific, and you seem to be fascinated by Australia. How come you went over there? Tell us more about your background. I received great offers from United States, Canada, Brazil and South Africa. I applied for every opening. From Australia I didn't get any answer and I got intrigued. They wouldn't even answer. They said that when the answer comes it comes. I started studying the country: few people, very rich country and nice weather. Nothing happened there: no war, no famine and any catastrophes and tragedies. It seemed a very good place to go and the more I found out about it the more I wanted to go there. I kept getting reminders especially from Brazil � at that time there was the boom in constructions in Rio, Sao Paulo and Brasilia. They called me for an interview after six months. The first was what if you didn't find a job, what else could you do? At that time I was doing architectural models as an addition. I did that in Australia and I built a fortune. Seeing that I have a second profession, two weeks later I got the visa. As soon as I got to Australia the job was no longer available. I searched for a job on Sunday, went to interviews on Monday and started work on Tuesday. I had the advantage of knowing French. Nobody speaks French there and I knew it better than English. French is a way of living. I learned the language in Romania as a kid. I started reading between four to six hours a day. I couldn't sleep. Even today, I have taught me not to sleep. I do a yoga exercise for more than 50 years. In ten minutes I can pass away and I float. It's total relaxation. Twenty minutes spent like that are the equivalent of 3-4 hours of sleeping. Ten minutes you are relaxing your muscles from head to toe and back to the head and for the other ten minutes you simply float and wake up relaxed. I used to write poems as a teenager and sell them for up to 10 lei. I was providing for my family. My father was in prison. I was 13 years old. My mother never worked. My brother was too young. An uncle was a poet but he never wrote anything or made money from what he wrote and there was also my grandmother. Nobody worked. There are always opportunities. You simply have to look around. I can make a lot of money. Andrew Prolea, as your father George lived in Australia, you were born over-there. What's your point of view about the Romanian situation? During communism people were promoted by factors like the time spent with a company, through connections and by means of the systems but not by true merits. Therefore, after the fall of communism, anybody all over the world who would end up being in a senior or middle management position had some sort of entrepreneurial inclination. They became the first entrepreneurs here because it was a new market and there were lots of opportunities, lacking anywhere else in the world at that time. That means that anybody having literally half a brain or more, even no capital but having opportunity became an entrepreneur. It was a rapid process. What happened was that there was a complete generation of people having any sort management skills. Management wasn't taught in school and there was no practical implementation available. What we have now being a foreign company in Romania and a Romanian company after five years � and my peers are discussing this at a regular basis - is that there is no middle or senior management in the country. Anybody finding himself in that position has got there on his own. The crisis now brought that back. A lot of people who tried have failed and there is a lack of funds and opportunities. In this tough period companies have to be prepared. What about employees, trainings are very important within a company, how important is it for you? We are now seeing for the first time in Romania people who actually have some sort of skill base to take on middle management. So, anybody investing in Romania doesn't need to worry so much about the business activities and debts but about the day by day management of company's resources. It's a really a matter of all. Bringing people up from below, seldom do they have the skills to become middle management and senior management and to be connected with the growing business. I'm training them because there are very good people in this country but they have no experience. Normally you throw them to deep waters and expect them to swim. This it just doesn't exist. Anywhere in the world you are trained. People who pass themselves here with MBAs and training experience they basically got them online or went on a course in Canada and started up a job training and recruitment business. This has been the problem in Romania for the last five years. This year is the first one when we managed to do some key hires of Romanian origin that are eligible for the task. That's purely because they haven't got the opportunity to start their own business. There is no other reason. It's a tricky process. Basically, when local people had been trained to integrate into management and soonest as expats left sales went down and marketing failed. Now multinationals are reintroducing their expats back into key positions. This is because no matter what level of training you have to change the mentality and that's a generational change, not an overnight change. That's why Romania is failing in business. It's solely based on management. They are extremely well-educated. All ingredients are here. It will take a little bit off time and nurturing and you can get wonderful results in this country. What's your opinion about Romanian opportunities? Labor is cheap relative to the rest of Western Europe and Romania offers a Latin country in the middle of Slavs and Huns. Romania also is Europe's third agricultural country after France and Poland. This is an area here that's still untapped. French banks � Credit Agricole took over Emporiki Bank in 2006 - are here now and dedicate themselves to the agricultural sector. These agricultural funds I think represent 77% of the bank's turnover. Agriculture is a key area why they considered buying out the Greek bank to enter Romania. They wanted to expand their portfolio because Romania has a key geographical position and also is a key player in the agricultural sector on a global sense. Romania it's a gateway to the east. Romania has the potential of being there. It just needs the right management from the government and right down to the lowest levels of society. All it needs is management and nothing more. The biggest problem we have is the problem of process, just as we had some momentum of foreign direct investment which was triggered by the accession to the European community. We had massive FDI at the last quarter of 2006. After that we had a rapid increase and then all of the sudden the global crisis hit. You also have to take into account that 85% of banks in Romania are represented by foreign ownership - almost 50% being Austrian � and their home economies had their own issues. We are the last country in Europe at the moment, we are the last ones in and we are the first ones to be left behind purely because everyone else has to look into his own backyard. I think we'll see some more 12-24 months of turmoil in the economy, depending on when we see a serious direction from the current government, whether it's a new election or a new alliance or coalition. The biggest problem in Romania is the lack of direction at a political level. The potential in every sector is under-resourced and underexploited. With a little bit of finance coming into the country people will be able to make a lot of money. What do you think of Romania's position and status with regard to European funds accession? The biggest problem with accessing European funds is that they are very hard to access due to the bureaucracy. One of the steps to access these funds needs to be done through some sort of a governmental body. But the governmental bodies haven't been trained in how to access the funds. In the agricultural sector they don't even have computers within the local councils to fill in the applications and apply for the funds. People are not educated properly on how to invest. We are here and we'll still be because we believe in the potential and future of this country and of its people. Romania needs better coordination and credit recovery. There was no subprime and sophisticated lending Romania. There was no room for anything to be affected as far as the banks are concerned. The only thing that was affected was land cost. Bank have accumulated enormous amount of debt in land. But it will recover. There still is potential. Romania still has a very young population and a housing issue for them. If you look at the official statistics, there are 8.1 million homes to 23 million people. There are 2.7 people per home and a small size living area of 55 square meters in central Eastern Europe. In the rest of central and Eastern Europe the average is 2.4 people per 75 square meters. If you take into account that almost nothing was built from 1989 to 2002 because there was no mortgage system here until 2004, there is still a high demand. We are working in this vicious cycle but I do think we will recover reasonably quickly because we didn't have any sophisticated problems in the system. Romania will recover faster than other countries like Spain with 800,000 home unsold. It was purely speculative construction. In Romania, for years, we haven't got homes but we had buyers. Romania is a medium term gain. In the rest of the world it would be considered short term but in Romania it is considered long term because of the mindset of the people. According to that, everything has to be done now. Nobody does five or ten years planning. Everyone does three months and 12 months planning. The latter is long term planning in Romania while for the rest of us 5-10 years is medium. This is the mentality that needs to change at the level of the business sector in Romania. Once that happens than the world would be Romania's because the land is naturally rich. It just missed to be properly exploited. Romania needs the right middle management teams. People have to be trained properly and business systems need to be put in order. How is it like to be an expat in Romania? The expat community here is actually quite strong. It's normally filled with schools and wives because we normally work 16 hours a day. There is a lot to do and explore here. At first it is hard to settle in but once you are here there is a very strong sense of community. What differentiates Bucharest of other expat communities like Moscow, Middle East or Asia is that you are not confined in the universe of the residential park you live in and having absolutely all you need. You don't live an isolated life. Here you mix with the locals, you interact and make friends. This makes it a lot nicer especially if you are here for a longer term.

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"South Pacific este primul dezvoltator care si-a anuntat intentia de a construi un ansamblu rezidential gandit dupa termenii impusi de programul guvernamental. Unii dintre jucatorii de pe piata locala au anuntat ca isi regandesc proiectele, pentru a fi cat mai accesibile, prin intermediul acestui program. "Am proiectat un ansamblu de 80 de unitati, de proba. Este vorba despre garsoniere care cuprind un dormitor si un salon, cu gradina, la un pret de 60.000 euro. Ne-am adaptat rapid la cerintele programului "Prima Casa", a declarat pentru Business Standard George Prelea, presedintele companiei. Investitia in proiect va fi de numai 2-3 mil. euro, deoarece proiectul va fi construit din materiale ecologice, care duc costul constructiei la circa 850 euro/mp. Proiectul va fi demarat spre sfarsitul acestui an si va fi amplasat in Tunari. Structura locuintelor este inspirata dupa model englezesc si va cuprinde grupuri de opt-noua locuinte lipite, fiecare beneficiind de o parcare in fata locuintei si de o gradina privata in spate. Suprafata minima a unei astfel de case va fi de 52 mp si va beneficia de o bucatarie, un salon, o debara, o baie si un dormitor. Dezvoltatorul ofera in pretul de 60.000 euro bucatarie utilata, aer conditionat si centrala termica. Proiectul va cuprinde si locuinte structurate pe doua niveluri, al caror pret va fi intre 80.000 si 85.000 de euro si care vor avea in plus doua dormitoare, la etaj. "Cu Ministerul Apararii am incercat pentru prima oara acest tip de proiect si a prins foarte bine. O sa aducem 10-15 tehnicieni din Marea Britanie, pentru a ne ajuta sa il implementam cu succes. In Australia, acest tip de locuinte este un mod de viata", a explicat oficialul companiei. Potrivit lui Prelea, acest model de case va fi replicat si in restul tarii, prima locatie fiind Constanta. Chiar daca marjele de profit sunt minimale, reprezentantul companiei este de parere ca ii va ajuta sa supravietuiasca in perioada crizei, in timp ce dezvoltatorii concentrati doar pe volum vor avea probleme. Totodata, South Pacific se afla in proces de avizare a unui proiect mai amplu, ce va cuprinde in jur de 255 apartamente si a carui constructie este programata pentru luna august sau septembrie 2009. "Acum am primit ultimul aviz de la Apele Romane pentru definitivarea PUZ-ului si speram ca, din august-septembrie, sa incepem lucrarile la proiect. Valoarea investitiei a ramas neschimbata, circa 38 mil. euro", a mai spus Prelea. Reprezentantul companiei a anuntat, la inceputul acestui an, ca banii obtinuti din vanzarea a 50% din companie, circa 30 mil. euro, vor fi reinvestiti in proiectele aflate in curs de dezvoltare. Fondul american Warburg Pincus, care controleaza si dezvoltatorul RED Management Capital, a intrat in actionariatul South Pacific in urma unei majorari de capital, tranzactie finalizata in septembrie 2008. Pana in prezent, fondul american a platit dezvoltatorului 20% din valoarea tranzactiei, urmatoarele transe urmand sa fie platite in functie de evolutia pietei si de necesitatile financiare pe care le va avea South Pacific, in contract nefiind specificat un termen-limita. Compania dispune de apartamente finalizate in doua ansambluri rezidentiale, Sydney si Melbourne, localizate in Tunari. South Pacific ofera posibilitatea platii unei chirii de 200 euro/luna, in cazul in care se achita un avans de 2.500 euro, sau o chirie de 500 euro/luna, in caz contrar. Chiria platita este dedusa in totalitate din pretul apartamentului. Clientii pot sta doi ani cu chirie, dupa care pot sa achizitioneze locuinta. Dezvoltatorul australian a intrat pe piata locala in anul 2005, primul proiect realizat in Romania fiind constructia unui complex de locuinte pentru angajatii Ministerului Apararii Nationale. In prezent, compania are, in diferite stadii de derulare, patru proiecte rezidentiale proprii, toate in Tunari, care includ, in total, peste 350 de locuinte. Firma a investit, de la intrarea pe piata locala, aproximativ 80 mil. euro. Zona de nord a Capitalei si, in special, comunele Pipera si Tunari au atras, in ultimii patru ani, numerosi investitori interesati de proiecte imobiliare, alaturi de australienii de la South Pacific numarandu-se companii ca Global Finance, GTC Romania, Impact, AlfaRom sau Bouygues, constructorul Satului Francez.

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Scaderea numarului de tranzactii de vanzare a locuintelor convinge tot mai multi dezvoltatori sa inchirieze apartamentele care nu au fost vandute, printre companiile care au anuntat astfel de masuri numarandu-se jucatori importanti precum Anchor Grup, Impact Developer & Contractor, South Pacific Group sau chiar investitori specializati pe achizitia de apartamente off-plan, cum este cazul norvegienilor de la Romania Invest.

Majoritatea acestor companii ofera posibilitatea achizitionarii ulterioare a apartamentelor, luand in calcul la stabilirea pretului o buna parte din chiriile achitate. „Pentru cei care aleg sa stea cel mult 24 de luni in chirie, dupa care decid sa cumpere locuintele, scadem din pretul de vanzare valoarea integrala a chiriilor achitate. Pentru un apartament cu doua camere in ansamblul rezidential Adelaide chiria lunara este de 280 de euro, in timp ce pentru o casa insiruita nivelul chiriei este de 1.000 de euro/luna", a declarat Andrew Prelea, CEO al firmei South Pacific Group. Pe langa chirie, compania poate solicita un avans, de 5.000-10.000 de euro, in functie de tipul locuintei. Dezvoltatorii sustin ca solutia da rezultate, tinand cont ca South Pacific a semnat antecontractate in ultima luna pentru 17 locuinte, potrivit reprezentantilor companiei.

Dezvoltatorul imobiliar South Pacific, controlat de oamenii de afaceri australieni George Prelea si fiul sau Andrew Prelea, va reinvesti toti banii primiti de la fondul american Warburg Pincus, in urma preluarii a 50% din companie, in proiectele pe care le au in derulare. Banii pe care ii vom mai primi vor fi reinvestiti imediat in proiectele pe care le avem in derulare. Nu pot sa va spun valoarea tranzactiei, pentru ca este confidentiala, dar suma de 30 mil. euro vehiculata in piata este foarte aproape de realitate, a declarat pentru Business Standard George Prelea, presedintele South Pacific. Fondul american Warburg Pincus, care controleaza si dezvoltatorul RED Management Capital, a intrat in actionariatul South Pacific in urma unei majorari de capital, tranzactie finalizata in septembrie 2008. Potrivit lui Prelea, strategia fondului american este sa aiba doua platforme distincte de dezvoltate, care sa se completeze, pe viitor, in diferite proiecte mixte. Warburg Pincus detine o participatie mai mare in cadrul RED Management Capital, dar nu suntem concurenti, pentru ca ei se ocupa exclusiv de centre comerciale, iar noi de rezidential.

Ne completam si suntem foarte apropiati. Pe viitor, dorim sa colaboram in realizarea unor proiecte mixte, a mentionat presedintele South Pacific. Pana in prezent, fondul american a platit dezvoltatorului 20% din valoarea tranzactiei, urmatoarele transe urmand sa fie platite in functie de evolutia pietei si de necesitatile financiare pe care le va avea South Pacific, in contract nefiind specificat un termen-limita. Urmatoarele transe de bani le vom primi in functie de evolutia pietei. Poate fi peste o luna sau peste un an, cand vom avea nevoie de ei, a explicat Prelea. Pana acum, South Pacific a investit 60 mil. euro pe piata locala, in trei proiecte, localizate in Tunari, ce urmeaza a fi predate in urmatoarele zile. Totodata, compania a anuntat recent ca va incepe, in acest an, doua proiecte rezidentiale noi, cu investitii de peste 75 mil. euro. Warburg Pincus a intrat pe piata locala in 2005, prin intermediul RED Management Capital (firma infiintata de Andrew Stear), in care fondul a investit 42 mil. euro. Americanii au intrat anul trecut pe piata locala si cu grupul Euromedic International.

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Pentru South Pacific Group (SPG) diavolul-crizei nu mai pare atat de negru
Marti, 17 Februarie 2009 de Fulvia Meirosu

Live and let live - intr-o interpretare romano-americano-australiana, o sintagma ce face din criza imobiliarelor o oportunitate de business.

Primele doua sfaturi pe care mi le-a dat avocatul meu ca sa am succes au fost: "Niciodata sa nu crezi in evaluarile tale personale" si "Nu incerca sa faci profit peste noapte. Lasa persoana care cumpara de la tine sa faca si ea profit, pentru ca in acest fel se va intoarce la tine", rezuma Andrew Prelea, CEO South Pacific Group (SPG), cele doua postulate ale unui business prezent pe piata romaneasca din 2003, ale carui baze le-a pus impreuna cu tatal sau, George - care se intorcea in Romania dupa ce traise 45 de ani in Australia -, si fostul bancher Richard Garner.
YES, WE CAN. SPG va livra in acest an trei ansambluri rezidentiale si va incepe lucrarile la alte doua, investitiile in toate cele cinci proiecte dezvoltate in partea de nord a Capitalei, in zona Otopeni/Tunari, ridicandu-se la 130 mil. euro. Din vara anului trecut, in actionariatul dezvoltatorului a intrat unul dintre cele mai mari fonduri americane de investitii, Warburg Pincus - care a investit pana acum aproximativ 29 mld. euro in peste 600 de companii din domenii ca servicii financiare, mass-media, telecomunicatii, sanatate, energie, industrie si real estate, din 30 de tari ale lumii -, prin preluarea a jumatate din businessul SPG.
In Romania, Warburg Pincus mai este prezent in calitate de actionar - alaturi de fondul spaniol GED - al dezvoltatorului RED Capital Management, care are in portofoliu proiecte de retail si de birouri in mai multe orase din tara. "Warburg Pincus a venit la noi - erau in cautarea unei companii axate pe rezidential, care sa completeze portofoliul celor de la RED - la recomandarea unuia dintre cei doi parteneri de la RED", povesteste Andrew Prelea. Un singur detaliu, partenerul in cauza era Andrew Stear, managing partner si actionar al RED, un pionier al pietei locale de real estate, de numele carui a se leaga prima faza a parcului industrial si de afaceri IRIDE.
Cu un fond de investitii atat de puternic in spate, diavolul crizei nu mai pare atat de negru, iar Prelea spune ca, oricum, imobiliarul romanesc e mai putin afectat de criza internationala decat real estate-ul altor tari.
ALTERNATIVE DE CRIZA. Optimismul sau este alimentat si de faptul ca SPG a livrat deja un prim proiect - un altul ar urma sa fie finalizat in martie, iar un al treilea in iulie-august. In total, 396 de locuinte, din care s-au vandut in ultimii doi ani aproximativ 70%. Prelea spera ca va vinde si restul de 30% in viitorul apropiat, avand in vedere ca propune doua variante de achizitie despre care spune ca sunt gandite special pentru "o piata unde oamenii nu fac economii, si, cu cat castiga mai mult, cu atat cheltuiesc mai mult", pentru a pastra descrierea pe care o face pietei romanesti.
Prima optiune propusa de Prelea este asa-numitul sistem "rent-to-buy" destinat clientilor care au venituri bune, dar nu si avansul necesar pentru a obtine un credit de la banca. Clientul in cauza poate sa stea cu chirie intr-una dintre locuintele din portofoliul SPG, pe o perioda de 18-24 luni, dupa care are de ales intre a cumpara sau a se muta in alta parte. In cazul unei achizitii, o parte din chiria platita pana in acel moment se scade din pretul apartamentului, constituindu-se intr-un avans.
"Cream un plan de economii pentru client, fara ca el sa-si dea seama de asta", spune Prelea, detaliind ca are relatii foarte bune cu BCR si Banca Romaneasca. Al doilea produs este similar cu cel oferit de bancile pentru locuinte, doar ca este axat pe o locuinta anume, aflata in constructie. In intervalul de timp in care casa este construita, clientul depune bani intr-un cont-escrow deschis pe numele sau si al dezvoltatorului. Iar cand casa este gata, are optiunea de a o cumpara, managerul SPG explicand ca poate finanta clientul pana in momentul in care acesta obtine un credit de la banca.
Transpus in caramizi si mortar, cel de-al doilea produs este mai degraba potrivit pentru celelalte doua proiecte rezidentiale pe care SPG le va demara in acest an si care insumeaza 520 de locuinte. O parte dintre acestea vor fi ceea ce Prelea numeste "eco-homes", case la care "ne uitam nu atat la economii la costurile de constructie, cat la costurile de intretinere". Ce inseamna asta? "Noi vom construi case la care factura de energie sa fie cu 60% mai mica", raspunde Prelea. Pretul unei astfel de locuinte este in medie sub 100.000 de euro, fiind vorba despre un produs destinat exclusiv clientilor finali, nu investitorilor - o parte dintre casele din ansamblul rezidential care este finalizat au fost cumparate de investitori in urma cu doi ani cu 140.000 de euro, pentru a fi scoase acum la vanzare pentru aproximativ 200.000 de euro.
"LINIA DE PLUTIRE". Prelea spune ca nu are probleme cu finantarea proiectelor, in conditiile in care Warburg Pincus a facut deja o injectie de capital in SPG, iar toate terenurile aflate in proprietatea companiei - nu mai putin de 25 de hectare -  au fost achizitionate cu fonduri proprii. Ultima achizitie de terenuri se intampla in iulie 2008, iar Prelea spune ca l-a costat de zece ori mai mult decat pretul pe care l-a platit in 2005 pentru o parcela aflata in aceeasi zona.
"Am facut asta ca sa ne asiguram ca, daca am fi avut vreo problema, nu am fi platit un credit pentru o proprietate care nu aducea nici un venit", explica Prelea logica acestor achizitii, recunoscand in acelasi timp ca a fost o decizie care a incetinit cresterea companiei. Dar notiunile sunt relative, iar ceea ce ieri a fost un minus maine poate insemna un plus: "Puteam sa fim mult mai mari, dar am fi avut probleme si mai mari acum".
SPG a intrat efectiv in paine in 2004, cand a castigat o licitatie organizata de Ministerul Apararii pentru construirea de blocuri pentru angajatii sai. Desi acest prim proiect nu a fost profitabil, Prelea spune ca a fost o experienta buna, care l-a ajutat sa cunoasca mediul de afaceri local. E mai mult decat un simplu amanunt retrospectiv, pentru ca omul de afaceri se gandeste acum sa participe din nou la astfel de licitatii. Iar rationamentul sau ar putea lua forma unui al treilea postulat SPG: "Pe timp de criza, important este sa mentii afacerea pe linia de plutire, nu sa faci un profit mare".

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Posted in: real estate at 2/9/2009 2:43:26 PM
Developer South Pacific has shifted market strategy to more affordable housing and expects to boost future sales through rent-to-buy and savings programs. Its two next housing projects will be built with ecological materials, for which the developer is looking at setting up a production unit locally. The firm, half-owned by Warburg Pincus investment fund, has also put its planned Grand Prix circuit on hold.
Four years ago, the South Pacific group was testing the waters of Romanian real estate with a first housing project, in collaboration with the Romanian Ministry of Defense. Four residential projects later, the developer has changed the entire strategy of the business again. It is looking at launching two residential projects built with ecological construction materials, and even at setting up a factory to produce those materials locally.
The two projects together should cost around EUR 80 million to build, depending on whether the company is able to set up the factory in Romania, or gets materials from the UK. Financing for one of the projects has been agreed upon, but depends on the level of pre-sales.
"Last year we sold half of the business to private equity fund Warburg Pincus. Everybody in the world of finance is taking a conservative view, so we are not drawing from those funds because of the global economic outlook. But when things start to smoothen out and settle down, we'll have a funding line available through there," says Andrew Prelea, CEO of South Pacific.
To help boost house sales, the developer has come up with a rent-to-buy program, "to allow people to get into the property market when the market is low," says Prelea. "We need to make sure we have clients. We are delaying our profits and equity return for the future, but at least we have a future, which is very important," he explains.
Despite seeing residential sales stalling, Prelea believes the restrictions on lending in Romania have been a "blessing", because it has kept housing debt at low levels compared to other countries in the region.
"It has affected our industry because of caution," says the CEO. But he expects the recent softening of lending regulation by the Central Bank to eventually have a real effect on the economy, all depending on banks.
"We are doing mortgages now with BCR for our clients, and loans are being approved. Of course, the lending criteria are a lot stricter than one or two years ago, they are lending to people who should be lent to. This is the upside of the global crisis, we go back to old fashion banking, to lending to people who can afford it," says Prelea.
The next two projects that South Pacific will build in Romania, both located in the northern area of Bucharest, will cater to the new market demand, says the CEO. The Darwin project, to be launched soon, will sell almost half of its apartments for under EUR 100,000 per unit, while all the homes from the next one, the Hobart residential project, will cost less than EUR 100,000.
Having gone through the development cycle last year, South Pacific expects this year to be about sales. Prelea's pessimistic target is to sell at least 100 units in the Darwin project, out of a total of 255. "Optimistically, I would like to sell out all of Darwin and the rest of my stock, and the next project to come," he says. The developer has managed to pre-sell 71 percent of its already launched projects.
"We are working on a volume business and a low margin, that's why we manage to keep everything under EUR 100.000. We are using the same strategy as in car manufacturing," says Prelea, adding that the ideal margin is between 15 and 25 percent. Sales at its Darwin project will be a real indicator of where the market will go, says the CEO, who is even planning to offer a financial product similar to housing banks, for people to save for a specific home.
The firm's rent-to-buy program uses a similar model: some of the monthly rent goes into a savings fund, which after two years of renting becomes down payment for the apartment, if the customer decides to buy. The strategy means those who rent save up to 20 percent of the price of the apartment. If market prices go down, the buyer can negotiate a new price, and if they go up, he or she gets to buy at the pre-established one, says the CEO.
South Pacific's other planned venture, a EUR 300 million grand prix circuit close to Bucharest, has been put on hold. "The upfront payment required, in this environment, was commercial suicide. Getting tenants is very difficult, and the car market is on a downturn, and this was the backbone of the development. We still want to proceed with a project of that type, we haven't put it away completely, but financing a project of EUR 200-300 million right now is impossible," the South Pacific CEO says.
"There are some things as a developer you should always believe in. Don't leverage on assets that don't produce income. And don't believe your own valuations. I learned the last one from my first property lawyer when I was 17," says Prelea.
What does a real estate downturn teach real estate professionals? Prelea says it shows that "we should always rely on the domestic market, not on foreign investors, on the speculator market, to fuel property sector." He's been through three downturns in Australia: in the late 80s, when the stock market crashed, in the 90s, when the Japanese market collapsed and when Nasdaq dropped, all impacting on his local property market.
By Corina Saceanu

 

 

2009-02-02 de George Sarcinschi
Dezvoltatorul imobiliar Australian South Pacific va incepe, in acest an, doua proiecte rezidentiale noi, cu investitii de peste 75 milioane de euro, in ciuda problemelor cu care se confrunta piata locala din cauzacrizei financiare.
Principalele argumente care au determinat compania sa continue investitiile sunt sursele de finantare asigurate din anii precedenti, constructia unor locuinte la preturi sub 100.000 de euro, precum si contractele incheiate cu o serie de banci pentru inlesnirea acordarii de credite ipotecare potentialilor cumparatori.

 

In Bucuresti exista inca o cerere foarte mare de locuinte si pentru ca am decis sa construim viitoarele proiecte cu materiale ecologice, care reduc cu 60% costurile energetice si, implicit, facturile de intretinere, iar finantarea o avem asigurata dinainte de inceperea crizei. Vom continua investitiile in 2009, indiferent de problemele de pe
piata imobiliara, a declarat pentru Business Standard George Prelea, presedintele South Pacific.
El a precizat ca se asteapta ca vanzarile de apartamente ale companiei sa se mentina intr-un ritm convenabil, deoarece preturile locuintelor se situeaza sub 100.000 de euro, iar clientii pot beneficia mai usor de credite ipotecare, ca urmare a parteneriatelor incheiate cu mai multe banci locale.
De asemenea, Prelea considera ca noile imobile construite cu materiale ecologice si care consuma mai putina energie vor atrage cumparatorii.
Compania va incepe, in aceasta vara, constructia unui ansamblu rezidential cu 255 de apartamente, care va necesita o investitie de 38,5 milioane de euro. Luna viitoare, vom primi autorizatiile de constructie pentru complexul Darwin, iar lucrarile vor demara in vara, urmand sa se finalizeze in circa un an si jumatate. De asemenea, in 2009 vom incepe un al doilea proiect, denumit Hobart, care va avea 264 de apartamente si va costa
in jur de 36 milioane de euro?, a afirmat Andrew Prelea, CEO-ul South Pacific.
Dezvoltatorul australian a intrat pe piata locala in anul 2005, primul proiect realizat in Romania fiind constructia unui complex de locuinte pentru angajatii Ministerului Apararii Nationale.
In prezent, compania are, in diferite stadii de derulare, patru proiecte rezidentiale proprii, toate in Tunari, care includ, in total, peste 350 de locuinte. Firma detine 25 hectare de teren in Tunari si a investit, de la intrarea pe piata romaneasca, aproximativ 80 milioane de euro.
Zona de nord a Capitalei si, in special, comunele Pipera si Tunari au atras, in ultimii patru ani, numerosi investitori interesati de proiecte imobiliare, alaturi de australienii de la South Pacific numarandu-se companii ca
Global Finance, GTC Romania, Impact, AlfaRom sau Bouygues, constructorul Satului Francez.

Vezi intreg articolul

2009-02-02 de George Sarcinschi
Dezvoltatorul imobiliar Australian South Pacific va incepe, in acest an, doua proiecte rezidentiale noi, cu investitii de peste 75 milioane de euro, in ciuda problemelor cu care se confrunta piata locala din cauzacrizei financiare.
Principalele argumente care au determinat compania sa continue investitiile sunt sursele de finantare asigurate din anii precedenti, constructia unor locuinte la preturi sub 100.000 de euro, precum si contractele incheiate cu o serie de banci pentru inlesnirea acordarii de credite ipotecare potentialilor cumparatori.

 

In Bucuresti exista inca o cerere foarte mare de locuinte si pentru ca am decis sa construim viitoarele proiecte cu materiale ecologice, care reduc cu 60% costurile energetice si, implicit, facturile de intretinere, iar finantarea o avem asigurata dinainte de inceperea crizei. Vom continua investitiile in 2009, indiferent de problemele de pe
piata imobiliara, a declarat pentru Business Standard George Prelea, presedintele South Pacific.
El a precizat ca se asteapta ca vanzarile de apartamente ale companiei sa se mentina intr-un ritm convenabil, deoarece preturile locuintelor se situeaza sub 100.000 de euro, iar clientii pot beneficia mai usor de credite ipotecare, ca urmare a parteneriatelor incheiate cu mai multe banci locale.
De asemenea, Prelea considera ca noile imobile construite cu materiale ecologice si care consuma mai putina energie vor atrage cumparatorii.
Compania va incepe, in aceasta vara, constructia unui ansamblu rezidential cu 255 de apartamente, care va necesita o investitie de 38,5 milioane de euro. Luna viitoare, vom primi autorizatiile de constructie pentru complexul Darwin, iar lucrarile vor demara in vara, urmand sa se finalizeze in circa un an si jumatate. De asemenea, in 2009 vom incepe un al doilea proiect, denumit Hobart, care va avea 264 de apartamente si va costa
in jur de 36 milioane de euro?, a afirmat Andrew Prelea, CEO-ul South Pacific.
Dezvoltatorul australian a intrat pe piata locala in anul 2005, primul proiect realizat in Romania fiind constructia unui complex de locuinte pentru angajatii Ministerului Apararii Nationale.
In prezent, compania are, in diferite stadii de derulare, patru proiecte rezidentiale proprii, toate in Tunari, care includ, in total, peste 350 de locuinte. Firma detine 25 hectare de teren in Tunari si a investit, de la intrarea pe piata romaneasca, aproximativ 80 milioane de euro.
Zona de nord a Capitalei si, in special, comunele Pipera si Tunari au atras, in ultimii patru ani, numerosi investitori interesati de proiecte imobiliare, alaturi de australienii de la South Pacific numarandu-se companii ca
Global Finance, GTC Romania, Impact, AlfaRom sau Bouygues, constructorul Satului Francez.

Vezi intreg articolul

Andrew Prelea:"Recesiunea este cea mai buna perioada pentru a face bani"

Rezumat:
Parteneriatul public-privat este cheia traversarii cu succes a crizei financiare. Este convingerea lui Andrew Prelea, director al South Pacific, prima companie autohtona de dezvoltare imobiliara care a demarat un proiect rezidential in colaborare cu o institutie publica.Andrew Prelea a invatat rapid ca afacerile imobiliare din Romania se fac altfel decat in Australia, tara lui natala. In tara noastra a ajuns la invitatia consulului Australiei. Impreuna cu tatal sau a pus pe picioare o firma de dezvoltare imobiliara. Si, in scurt timp, acasa a devenit Romania. Afaceri a facut insa de cand se stie. A cumparat primul apartament la 18 ani. L-a renovat si l-a vandut. Acesta a fost primul pas in afacerile imobiliare al lui Andrew Prelea, australian de origine romana si director al companiei South Pacific.

Primul proiect, un succes controversat

Dupa descinderea sa in Bucuresti din anul 2003 a aflat ca Ministerul Apararii Nationale (MAPN) intentiona sa finanteze constructia unor case destinate cadrelor institutiei, in Straulesti. Contractul fusese deja acordat unei alte firme, care nu avea suficienta putere financiara si experienta in domeniul constructiilor. A urmat un an si jumatate de negocieri cu autoritatile si cu firma respectiva pentru un eventual joint-venture. In cele din urma, South Pacific a construit singura locuintele din zona Straulesti. Asa a aparut primul cartier privat din Romania ridicat pe un teren public. "Nu am avut colaborarea autoritatilor, desi era un proiect semisocial", afirma Prelea. Mai mult, el spune ca vanzand locuintele cu 390 euro pentru un metru patrat compania sa a pierdut jumatate de milion de euro. Angajatii MAPN au dat intre 22.000 euro si 27.000 euro pe o garsoniera si aproximativ 50.000 euro pe o casa cu gradina pe malul lacului.

Noi gusturi in materie de locuinte

Omul de afaceri este convins ca are cheia succesului pentru afacerile autohtone. "Romanii nu mai vor apartamente, oricat de frumoase ar fi ele. Isi doresc case pe pamant, chiar daca sunt mai mici si nu ofera acelasi confort", crede Andrew Prelea. Si, nu in ultimul rand, vor ceva nou, continua el. Mai ales tinerii care merg in strainatate si isi doresc o altfel de Romanie. Directorii companiei South Pacific au aflat asta de la propriii angajati. Majoritatea au varste cuprinse intre 20 si 30 de ani. "Preferam sa angajam studenti pe care sa ii orientam spre ce avem noi nevoie. Nu poti schimba mentalitatea unui om care are 50 de ani - opineaza Andrew. - Dar ca sa poti lucra in constructii, trebuie sa fii facut pentru asta", completeaza el. La cei 40 de ani ai sai, Andrew se poate lauda cu o experienta de 22 de ani in breasla. De fiecare data cand a incercat sa faca altceva a revenit in domeniu. "Iti intra in sange. Tot ceea ce poti face este sa evoluezi odata cu vremurile", spune el.Chiar si in conditiile in care piata intra in recesiune, tot constructiile sunt cele care il atrag si ii aduc bani. "Cea mai buna perioada pentru a face bani este una de recesiune.
Trebuie insa sa fii foarte atent pentru a supravietui", spune dezvoltatorul. In Australia a trecut deja prin doua recesiuni. Chiar daca autoritatile din Romania nu vor sustine puternic segmentul constructiilor, afacerile imobiliare vor ramane profitabile, crede directorul South Pacific. De fapt, problema in momentul de fata este ca romanii nu mai au incredere in dezvoltatori. Lui nu ii este teama ca va ramane cu locuintele nevandute. "La pretul corect si cu finantarea potrivita, romanii vor continua sa cumpere", crede el. Au gandit deja un concept conform caruia, chiria platita se acumuleaza intr-un cont care se ia in calcul la cumpararea casei. O alta varianta este un sistem de genul bancilor pentru locuinte in cazul imobilelor aflate in stadiul de proiect. Cei interesati isi depun banii la South Pacific, bani pentru care primesc dobanda, iar peste doi ani, cand se vor muta, suma adunata va constitui avansul. In cazul in care constructorii nu livreaza locuinta conform contractului, banii pot fi retrasi.

I: which will be the prices evolution for the lands in 2009 on the Romanian real estate market?

R: In 2007 and 2008 the land prices increased at an abnormal rate due to foreign investment and speculation.
Our belief is that anyone who is not developing the land and who bought for speculation will see the prices fall especially if they have borrowed money from the banks to finance these purchases.
We see offers every day of land that were bought in the past 2 years for sale at prices from 2006.

I: does still exist investment opportunities for the individuals on the real estate market and which are these opportunities on the local market?
R: There are some very good opportunities now on the Market and better financial products for individuals evolving every day.
We at South Pacific for example are offering a Rent-to-Buy product that gives people 18 months to 2 years to rent their home and then buy it at the end of the rent period for up to 15%-20% discount.
We are also introducing a 0% Deposit on new developments in 2009 for our Darwin and Hobart projects.
What is important now is that developers are focusing on local demand and pricing instead of speculators. This means that we will see a lot of apartments under 100,000 Euro in the next few months.

I: which will be the prices evolution in 2009 for every segment - residential, commercial etc?
R: We will see a steadying of prices in 2009 and in some sectors such as luxury we may see a fall in the 1st and 2nd quarter of the year on housing over €1,500/m2.
But what we must not forget is that we have a housing shortage in Romania and especially in Bucharest and current construction rates are not meeting demand.
The government also will help stimulate the market with initiatives such as the 5% TVA on houses under 100,000 Euro with an area less than 120m2 which will make housing more affordable to the population.
The main issue is when will banks start to lend again and until we have the answer to that question, no one can answer where prices will go.

I: which is the best moment for a house acquisition in 2009?
R: I believe now would be the best time to buy a house or secure a position on a new development, as banks are asking for more pre-sales from developers and this is encouraging them to sell with better terms and prices.
Liquidity in the market may ease in the 3rd quarter of this year and typically when this happens prices stabilize and prices may bounce back.

 

Transaction with financing

The Warburg Pincus investment fund recently bought 50% of the South Pacific Group developer. The funds will ensure the continuity of the projects.

By Raluca Comanescu

The shareholders of the South Pacific Group have recently signed the agreement for the sale of 50% of their shares in order to enable the development of their business with sufficient funds and in order to accelerate the completion of their existing projects. According to the company’s representatives, the new capital received by the company – which some sources on the market estimate at more than 30 million euro – will allow them to make new purchases and contract supplementary financing lines for the expansion of their business model and the study of alternative construction methods.

“Due to the fact that South Pacific is currently in full expansion, we had to make sure that we didn’t have to wait for the completion of some projects in order to start working on new development projects”, Andrew Prelea, CEO of the South Pacific Group, told BusinessWeek Romania. Subsequent to the transaction, the new shareholder structure of South Pacific is made up of Andrew Prelea, Richard Gardner, George Prelea and the new partner, Warburg Pincus.

Mr. Prelea went on to say that the company managers had anticipated the need for supplementary funds, as requested by the banks, due to the increase in the company’s portfolio and the fact that considerable funds are necessary for development before any income can be generated. According to Mr. Prelea, the discussions with the investment fund started last year, in November, before the credit crisis. “We took this decision last year in order to be able to develop our business with a strong partner by our side”, stated the representative of the real estate company.

Consequent to the new capital injections, South Pacific will start working on the Darwin residential project in spring, while the works for the Hobart project will start next summer. “These projects have been designed around the concept of an efficient house from the point of view of energy use; this concept implies zero carbon emissions and the reduction up to 70% of the customer’s electricity and gas expenses” Mr. Prelea explained. He added that this new housing concept will allow the company to set lower prices for their apartments and houses, ranging between 65,000 and 150,000 euro.

What are the benefits of a partnership with one of the largest private investment funds in the world under the current circumstances? The first benefit Mr. Prelea mentions is the lack of the volatility which characterizes the other publicly listed funds. Another benefit is the access to the capital.

South Pacific intends to use the new funds to develop construction methods for environmentally efficient buildings, which would help the company to become the first developer of ecological houses at a large scale in Romania. “The last, but not least important benefit is the comfort of the banks that grant us credits, as well as the comfort of our customers, whom this partnership will help convince that their investments are safe and will be completed according to the standards they expect”, Mr. Prelea added.

Although BusinessWeek Romania contacted them, the representatives of the Warburg Pincus investment fund with private capital did not provide any comments before the edition closure. The American investment fund, Warburg Pincus, is already present in Romania as one of the shareholders of the company Real Estate Developers (RED) Management Capital, together with the Spanish investment fund GED Group. RED Management Capital was created for the purpose of investing in South Eastern Europe, especially in Romania, in all the real estate segments, ranging from residential and retail to office buildings and large-scale industrial projects.

The company already has a completed project on the Romanian market, Iride Business Park and another four under construction, both in Bucharest and in other cities: Trident Plaza Constanta (shopping center, office buildings, hotel), Natura Residence Bucharest (residential apartment complex), as well as the Armonia shopping centers in Arad and Braila.

South Pacific, in its turn, has projects in two segments of the real estate market in Romania, namely the residential and the commercial ones; most of these projects are located in northern Bucharest.

30 mil. Euro is the estimated value of the funds obtained by South Pacific after selling 50% of their shares to Warburg Pincus.
Source: BusinessWeek Romania