Braila’s Armonia mall up for auction, while Bucharest’s Liberty Center sheds tenants

Bankrupt commercial center Armonia in Braila, developed by Red Project Three, part of Red Group, has been put up for auction this month, for EUR 25.03 million

April 2012 - From the Print Edition

Its main creditor is Volksbank, which is owed EUR 28 million. Armonia was declared bankrupt at the end of 2011, after filing for insolvency in November 2010, two years after its launch. The developer had invested EUR 45 million in the project but the mall went on to run up debts of EUR 35 million to 33 creditors, according to the judicial administrator, Casa de Insolventa Transilvania.
This is the third mall to face bankruptcy in Romania, after Tiago Mall Oradea, now Oradea Shopping City, and several attempts to auction off City Mall in Bucharest. Both commercial centers have now been sold. Tiago Mall was bought for EUR 30.5 million by Shopping Center Holding, a company owned by Karias Trading Limited, which is registered in Cyprus, and Romanian businessman Dumitru Ciocoiu, known for his involvement in projects such as Baneasa Business & Technology Park. And last year City Mall was re-sold for EUR 17.3 million to a Greek investor who had owned it in 2006. It was then bought by Australian property fund APN European Retail Trust.
Another mall in Bucharest, Liberty Center, owned by Irish company Mivan and the Awdi family, is facing tenant problems, after losing major names such as Marks & Spencer, Forever 18 and fast food firm Burger King this year alone, who joined an exodus that also included Starbucks and Diverta. Currently, the mall’s tenant portfolio includes Billa, Altex, Hervis, Next, Sprider Stores, Reserved and The Light cinema.