Year 2008 to be first difficult one for real estate consultants

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The top five real estate consultancy companies in terms of turnover posted an over 26% profit margin last year, while turnover doubled (49 million euros in revenues), the Ziarul financiar reads on Aug. 26. Nevertheless, the growth rate is expected to slow down significantly this year, following the international credit crunch that has affected the domestic real estate market.
 
"This is a difficult year, in which three markets are slowing down and are not performing as well as they did last year. We continued to grow in the first half, but the problems on the market in the first six months will catch up with us in the
 
second half. This goes for the entire market, but, speaking exclusively about Colliers, we set out, conservatively, to reach the same turnover and profit as in 2007," the daily quotes Colliers International managing partner and shareholder Bogdan Georgescu as saying.
 
Colliers posted 21.2 million-euro revenues and 7.3 million euros in profit and was also the market leader in 2007, according to data on the Economy and Finance Ministry's website.
 
Number two on the market was CBRE Eurisko, whose business stood at 14.4 million euros and profit reached 3 million euros, while Jones Lang LaSalle ranked third in the first year since its comeback on the market, with 4.6 million-euro revenues and 1 million-euro profit.
 
The other top five companies are Cushman & Wakefield Activ Consulting (4.5 million-euro business and 1.2 million-euro profit) and DTZ Echinox (4.3 million-euro business and 0.4 millioneuro profit), so that this is the first year when companies that belong to international networks exclusively dominate the market, after CB Richard Ellis bought Eurisko Consulting at the beginning of the year and Regatta failed to make the top five, the Ziarul financiar writes on.
 
Eurisko posted over 150% business growth in 2007 and it expects a turnover by 40% higher this year CBRE Eurisko manager Radu Lucianu, told the newspaper.
 
The cumulated profits of the five companies amounted to 12.9 million euros in 2007, which made real estate consultancy one of the most profitable service businesses.
 
The market is affected by the decline in the sale of flats this year, as well as by the apathy of the real estate mergers and acquisitions segment, as only a few major deals were concluded, generally without real estate consultants. One of the few exceptions was the sale of the Iris Shopping Centre in Titan district of Bucharest, where CBRE Eurisko assisted the buyers, DEGI, the Ziarul financiar concluded.
 
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