Last year was one of the weakest of the last 20 in terms of new space deliveries, especially in the office sector. Weak economic growth, the political turmoil of the first half of the year, and tax increases in the second half translated into zero deliveries in the office sector and the weakest fourth quarter for residential sales in the last nine years.
By Aurel Dragan
More precisely, the fourth quarter of 2025 was the weakest year-end for home sales in Bucharest and Ilfov in the past nine years and also the weakest period for national residential transactions since 2019, according to a market report by real estate consultancy SVN Romania. Over 159,500 residential units were sold in Romania in 2025, down 5.3% from the 2024 result, while over 55,000 residential units were sold in Bucharest and Ilfov county, down 8.5% from 2024, according to the statistics published by the National Agency for Cadastre and Land Registration.
The announcement of a VAT increase on home transactions starting August 1, 2025, triggered a sales peak in July, when the Bucharest–Ilfov region recorded an annual increase of 12.6%, followed by a further 10.2% rise in August. In contrast, the following months saw a steady deterioration in activity: home sales declined by 8.5% year-on-year in September, fell by 22% in both October and November, and dropped by 24% in December.
“The mass market residential segment, which relied overwhelmingly on transactions with a 9% VAT, slowed down significantly since August, and an equally harmful effect is the significant decline in the number of closed presales agreements. Home sales on the middle market segment are still very good, since the VAT increase for these homes was marginal. This shows that the housing deficit is real and demand is still solid overall. But the accessibility of new housing has been significantly hampered in the mass market segment, which will also lead to an increase in rents on the short and medium term. Tax hikes can be beneficial if they bring higher budget revenues, but if they lead to losses through lower sales and investments, the economy as a whole suffers much more—ultimately generating not gains, but significant losses!” warned Andrei Sarbu, the CEO of SVN Romania.
Development slowdown
According to the “Top 10 forecasts for the Romanian real estate market in 2026” report by Colliers, after several years of rapid growth followed by successive adjustments, Romania’s real estate market is entering a new phase, characterised by a slower pace of development amid a need for sustained fiscal reforms and a geopolitical context which continues to generate a high level of uncertainty. For the real estate sector, 2026 is shaping up as a year of adjustment and repositioning, in which prudent decision-making, careful investment selection, and the ability to adapt will matter more than speed or development volumes.
In this context, 2026 will not be a year of rapid recovery, but rather one in which the resilience of both the economy and real estate market participants will be tested. While the economy will face significant challenges, opportunities will continue to exist. Infrastructure investments, the gradual return of private investment appetite, and the uneven performance of different market segments may create room for growth for those taking a medium-term perspective.
Even though Romania’s economic growth is only expected to reach a modest 1% in 2026, while inflation is only forecast to return to lower levels in the second half of the year, this year could be a very strong one for Romania’s transport infrastructure, with more than 300 kilometres of motorways and express roads potentially becoming operational if the current pace is maintained and promises are met, according to Colliers. These investments are largely supported by EU funding, meaning they depend directly on political stability and the authorities’ ability to deliver on key reforms. Beyond their direct economic impact, infrastructure developments are expected to accelerate the reconfiguration of the investment map, increasing the visibility of secondary and mid-sized cities and easing pressure on Bucharest. At the same time, the expansion of transport networks will offer access to new real estate development areas that were until recently considered unviable by investors. However, the risk of administrative delays or shifts in political priorities continues to pose a threat to project timelines.
The industrial and logistics sector is expected to take on the advantages of the new roads and remain resilient in 2026. Although total leasing volumes may decline slightly compared to the record-breaking 2025, demand is becoming more balanced, with growing interest from both manufacturing and logistics occupiers. Rising interest in strategic industries reflects not only economic factors but also geopolitical shifts and the need to secure supply chains, contributing to greater market diversification. In addition, 2026 could bring increased interest from companies operating in strategic industries, including defence and related sectors, further broadening the demand base. At the same time, interest from Asian investors, particularly China, is growing significantly.
Offices
The office market enters 2026 in a landlord-favourable position, driven by a lack of new supply and high development costs, according to Colliers. Following a year with no new office deliveries in Bucharest in 2025—a first in at least 25-30 years—new projects are beginning to re-emerge, albeit at a slower pace than in the pre-pandemic period and insufficient to address the shortage of high-quality modern buildings. In this context, occupiers are becoming more selective, focusing on energy-efficient, well-located buildings adapted to current working patterns, while upward pressure on rents continues as the supply of such spaces remains limited, even against a backdrop of relatively modest internal leasing demand. Colliers notes that the gap between prime buildings and older stock will continue to widen, with market interest increasingly concentrated on well-positioned, energy-efficient projects.
“We are in a period of transition towards a landlord’s market. The vacancy rate in Bucharest was 11.75% at the end of 2025, much lower for new buildings. After zero deliveries last year, we expect approximately 40,000 square metres to be delivered this year and 90,000 in 2027. Demand is slightly higher, between 50,000 and 90,000 square metres annually,” says Silviu Pop, Head of Research for Romania at Colliers.
The retail market is expected to remain stable in 2026, despite ongoing pressure on consumer spending. Inflation, higher taxes and a less dynamic labour market may temper household consumption, yet Romania continues to lag behind the regional average in terms of modern retail space per capita, supporting medium-term growth prospects, Colliers underlines. Even in a more cautious consumption environment, retail remains one of the segments with the strongest medium-term visibility, largely due to the structural shortage of modern retail space. As a result, developers are increasingly focusing on secondary and mid-sized cities, where retail park schemes remain attractive thanks to lower costs and high flexibility. According to developers’ plans, around 240,000 square metres of new retail space are expected to be delivered in 2026, the highest level since 2011.
The investment market could begin to recover in 2026, as yields start to move more favourably in Western Europe and risk appetite gradually returns. After a 2025 marked by caution and the postponement of several major transactions, Colliers expect a gradual revival in investment activity. In this context, prime assets could benefit from a slight yield compression, particularly if the anticipated adjustments in Western European markets materialise—with early positive signals already observed towards the end of 2025. Nevertheless, investors are expected to remain selective, and the gap between high-quality assets and secondary properties is likely to widen further, in a market where decisions will be increasingly carefully weighed.
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