Fortress REIT acquired ELI Park 1 from Element Industrial and Paval Holding

Fortress, one of the largest real estate investments trusts (REITs) in South Africa, has reached an agreement with Element Industrial and Paval Holding and signed the acquisition contract for ELI Park 1, a class A industrial development, located in the newest logistics hub North-West of Bucharest, Buftea – Chitila, making it their first logistics acquisition in Romania. 

“Romania is one of the most exciting long-term logistics and warehousing investment propositions globally due to the high industrial and consumer growth potential and close access to Western Europe. The market is in the development phase with a lot of runway for real estate investment for Fortress. We are selective and intend growing our high-quality warehouse portfolio across Central and Eastern Europe (CEE) in the coming years. Earlier this year we purchased our first logistics assets in Poland. In saying that – we are not strangers to the region, given that we are the largest shareholder in NEPI Rockcastle Plc, active in high-growth retail real estate in CEE,” said Steven Brown, CEO of Fortress REIT Limited.

“We are satisfied that by developing ELI Park 1 at high standards we have attracted a new player on the local market, South Africa’s largest logistics owner and developer, which brings valuable know-how and experience in Romania,” said Andrei Jerca, Managing Director, Element Industrial. “The transaction confirms Buftea-Chitila as the third logistics hub near Bucharest as well as the developing force of Element Industrial, recognized by a worldwide real estate giant,” he added.

ELI Park 1 is a 50,000 sqm GLA class A logistics and industrial park, located just 15 minutes from North of Bucharest and 5 minutes from the ring road, near the connection with the future A0, Bucharest new ring road. This is expected to change the logistics industry for Romania’s Capital City. ELI Park 1 is leased to tenants such as Arctic, Decor Floor, Dentotal, Euro Games Technology Romania, Kalapod, Mobilier 1, Novomatic and Paste Baneasa.  

ELI Park 1 was developed in joint venture by Element Industrial (founded by Romanian real estate investor Ionut Dumitrescu) and Paval Holding (founded by two Romanian entrepreneurs: Dragos and Adrian Paval). The transaction has been coordinated by a joint team of the sellers: Diana Nanu and Alexandra Popa from Element Group and Karina Paval and Narcisa Stanimir from Paval Holding, assisted by the real estate consultant, CBRE Romania led by Mihai Patrulescu and legal experts from Kinstellar, led by Alexandru Mocanescu. On the purchaser’s side, the transaction has been coordinated by Steven Brown, Howard Penny and Maciej Tuszynski of Fortress, assisted by Bogdan Papandopol, in consultation with Perry Zizzi, of Dentons, Cushman &Wakefield Echinox (led by Tim Wilkinson) and PWC (led by Cornelia Bumbacea).

Part of Element Group, with diverse investments in logistics, retail and office, Element Industrial is one of the most active local developers on the logistics market. The pandemic created new opportunities in the logistics market, in the context of acceleration of digitalization and the growth of the e-commerce market.