With a 4.8%-GDP growth in 2016 and the highest estimated growth rate in 2017 among EU member states, Romania has become an increasingly attractive destination for regional operations centers. The tax and legal regimes along with the geographic location, as well as the highly yet not so costly labour force are some of the key ingredients contributing to the country’s attractiveness, according to the Recipe for successful tax, law & real estate of regional operations centers in Romania report prepared by Deloitte Romania, Reff & Associates- Deloitte Legal together with Knight Frank.
As more and more multinational companies have opened regional operations centers in Romania, the real estate market saw in 2016 one of the strongest years. Outsourcing companies will continue to enter and expand into the market as developers have demonstrated their ability to offer multinational companies customised office solutions at lower rents than some other CEE markets, according to the report.
“Tax & legal regimes play an important role in the investors’ decisions. To remain attractive despite anticipated increases in cost and in difficulty to source talent, Romanian tax legislation needs to retain its current appeal through relative stability and fairly low rates, although both challenged by recent initiatives. Sudden changes, increases in rates or additional complexity in administration would seriously harm out competitiveness in a cost-sensitive business whose recent expansion has fuelled, among others, investment in office developments,” said Alexandru Reff, Country Managing Partner Deloitte Romania.
“Legal aspects are equally important, as employment, compliance, inter-company charges, data protection and corporate aspects may generate legal complexity for regional operations centers.”
Horatiu Florescu, Chairman & CEO Knight Frank Romania added: “These centers are the biggest demand generator on the office market in Bucharest and very often they are the main anchor of the building. It is very clear to all of us that operations centers developed the big office hubs we see today, namely Floreasca-Barbu Vacarescu, Dimitrie-Pompeiu, Center-West, and even CBD. These hubs have also the biggest stocks and demand on the market. Last year, the Center-West had a demand of over 120,000 sqm. Bucharest stays the main operations center driver, but Timisoara, Cluj-Napoca and Iasi are following-up very fast.”
The report analyses all key aspects that companies need to consider when opening a regional operations center in Romania from tax and legal to public financing such as State Aid and EU funding.
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© 2017. For information, contact Deloitte Romania
About Reff & Associates
Reff & Associates SCA is a law firm member of Bucharest Bar, independent in accordance with the Bar rules and represents Deloitte Legal in Romania. The firm counts 66 lawyers and is recognized both locally and internationally as one the top law firms in real estate, banking & securities and mergers and acquisitions. Deloitte Legal means the legal practices of Deloitte Touche Tohmatsu Limited member firms or their affiliates that provide legal services, which currently counts over 1,700 lawyers in 75 countries. To learn more about our practice at Reff & Associates please see https://www.reff-associates.ro/re/en/pages/expertiza/topics/HP.html
© 2017. For further details please contact Reff & Associates SCA
About Knight Frank
Knight Frank LLP is the leading independent global property consultancy. Headquartered in London, Knight Frank, together with its US alliance partner, Newmark Grubb Knight Frank, operate from over 413 offices, in 60 countries, across six continents. Knight Frank represents 110 years of reputation, heritage and continuous expansion on the global real estate market. Knight Frank entered the Romanian commercial property market in May 2009, forming an association with The Advisers, led by Horatiu Florescu. Starting June 2015 The Advisers became a fully branded Knight Frank business. Knight Frank Romanian office offers a full range of consultancy services on the office segment, capital markets, industrial, land, corporate residential, project management and evaluations.
© 2017. For further details please contact Knight Frank Romania