The FOUR BUILDING BOOMS of BUCHAREST

I believe that anyone interested to invest efficiently in Bucharest real estate and especially in its period buildings would need to have a minimal amount of information on its urban history in order to really understand the market and avoid its often deceiving traps.

• Bucharest encompasses on a relatively small, but representative territory the history of the Romanian real estate and its architectural heritage.
• The city has until very recently gone through a huge building boom, which has already changed its urban landscape. The construction sector is still one of the main engines of economic growth of the country and attracted the bulk of foreign direct investment.
• The current boom has also many negative aspects: most of the developments are ugly, poor quality and damage the landscape. The city’s rich older architectural heritage suffers considerably, many magnificent buildings falling in a state of profound disrepair. The architectural qualities of the new buildings and town quarters are non-descript and characterless, often mirroring the nearby communist developments. The building boom has created a speculative market that distorts the local economy and created tensions within society.

However that phenomenon is nothing new in the city’s modern history. It has in the last 150 years gone through four major urban transformations, including the actual one. I compiled here for your benefit a brief outline of the four successive building booms of Bucharest from the Victorian era to the present days:

-1^st boom: The reign of King Carol I (1860s – first decade of 1900s) when the city acquired the character of “Little Paris”. An iconic building of that period is the Romanian Athenaeum (now universally considered the symbol of Bucharest), a concert hall that follows the style of Opera Garnier from Paris. The boom was fuelled by the efficient organisation of the country on Western lines by the German origin King Carol I and the revenues generated by large grain export. The numerous residential buildings erected in that period imprinted the city with an intense charm for which became famous for decades to come. However many of these buildings were erected unsystematically, without a proper urban master plan, on the old oriental lines inherited from the previous times of Ottoman influences. They are now period building gems, some of the best such acquisitions which can be made in Bucharest. Today most of these buildings are in advanced state of disrepair, and many are being pulled down in order to erect ugly ramshackle commercial structures under the indifference of authorities and ignorance of many of Bucharest’s citizens about their own heritage and identity.

-2^nd boom: mid-1920s – early 1940s, characterised by grandiose buildings in a neo-classical style (see the Royal Palace) and also developments in an international modernist style (see Bratianu/ Magheru Boulevard). The money behind the boom came, among in great measure, from the huge revenues made from oil exports, Romanian being in the inter-war period one of the world’s important oil producers. The epoch is also the time when the most original grass root architectural style, neo-Romanian became very popular. The city was built now according to a proper urban master plan that is still influencing the geographical directions and alignments on which the city develops today.

-3rd boom: mid 1950s- mid 1980s (communist era construction boom)- characterised by huge housing projects, ugly and of very low quality high-rise block of flats that will blight the skyline of the city for many decades to come. The communist regime financed the construction programme from country’s own resources, mainly exports to the Soviet Union and subjected the population to near-slavery. However, there were also erected some important and architecturally interesting buildings in Bucharest such as Casa Scanteii (built with Soviet expertise and workforce), Sala Palatului (conference centre used by the Communist Party, built next to the former Royal Palace). The most remarkable among them is The House of the People, a hideous building of brobdingnagian dimensions reputed to be the second largest in the world, now the seat of Parliament. Its construction bankrupted the country causing huge misery and hastened the fall of the communist regime.

-4^thboom: from 2000 –end 2008 It had a timid start after the long recession caused a decade earlier by Romania’s painfully slow transition from a command economy to free market. It has been fuelled by a massive influx of foreign direct investments, mainly western real estate funds, a situation never experienced by the country in its entire modern history. The boom, in the last couple of years, reached a state of “real estate explosion” that radically changed the character of the city. The phenomenon is characterised by some distinct features such as the prevalence of low quality modernist-looking buildings with a very impersonal character, bland international style offices and apartment blocks. The old heritage value buildings are in many cases left in a state of disrepair or pulled down. However there are encouraging signs that more original themes that include traditional elements of Romanian architecture and from the interwar neo-Romanian style are now included in some of the new buildings. The prices for real estate have reached sky-high levels comparable with cities like Paris or New York, making them unreasonable even for western buyers. The unrealistic expectations of the local proprietors, unprofessional estate agents and multitude of rapacious speculators that plague the market are now brought down by the world financial crisis to realistic levels more akin to an emerging East European economy.

© Valentin Mandache

If you are interested in acquiring a period property in Romania or start a renovation project, I would be very glad to assist with locating the property, specialist research, planning permissions or the renovation project. To discuss your particular plan please see my contact details in the “Contact” page of this blog.