Dear members, This looks like a VERY attractive deal because the entry price is very low and this city is a real hidden jewel in Romania. In fact I would put this deal on a par with PS´s Central apartments deal in Wroclaw or their Katowice deal. Unlike Warsaw or Sofia, this is my sure 200% candidate for 3-5 year term I would say. Once Nokia move in and all the infrastructure is done, the price should rise a lot. Its like Wroclaw in Poland 2 years ago. Very few people knew about that city until suddenly it doubled in value. I´m currently trying to negotiate a re-mortgage in Spain to buy a flat in cluj but it may fall through cos banks don´t like my self-employment tag. Had I had the cash I would already have bought there. I was in cluj in August and this city is the economic hub of transylvania with strong hungarian connections and big investment from both austria, hungary and others. What really opened my eyes was the 80,000 or so students in the city. If u can´t let out a flat here, you probably can´t let out one anywhere! Plus it has loads of research centres etc. Mind you the centre of the city is already expensive. Theres little in the historical city-centre for under 120,000€ or much more. So from an investment and added value point of view this new area near nokia is a good bet for strong growth in next 2 years. the fact that Carrefour, auchan and all the big retailers are moving in there now says a lot. Regards and happy investing, Liam

I'm very optimistic about Cluj for the same reasons. My reservations though are that the village where the development is situated is 14km outside of Cluj - so rentals from students actually studying in Cluj is unrealistic. These are only going to come from the new Nokia workers. Additionally, the payment terms are very poor. However, if the projected levels of growth transpire then these issues are insignificant. Does anyone know for sure about the full Nokia and GM proposals? Are they formally confirmed? Russ

I am looking for my second Romanian deal and was initially interested in this one. However, the fact that there is no ongoing maintenance/managment fee for the complex means that this small developer has not even considered this aspect, and probably does not have the organization to set anything up. This happened to us in Cyprus where PS investors have been left with a maintenance nightmare, with PS turning their backs on the problem. These are cheap flats, and without proper maintenance/upkeep, they could quickly become the local slum. Many of the PS investors will be quite happy to buy, and then will refuse to pay a penny towards communal bills unless there is a legally enforceable structure in place from the start. If I was buying here, I would want to be in and out quickly.

Hi Mike, Where did you see that there would be no ongoing service charge? All I can see in the report is something along the lines of 'the service charge has not been specified yet by the developer but will be set at time of handover'. This is the same as for every PS deal I have bought into. I have a lot of sympathy for your situation in Cyprus, and I would hate to think it is going to happen elsewhere.

Minsk, you are right, bad choice of words on my part - that was the text that got me thinking. BUT - this looks like the Cyprus senario to me, small developer who has built a few local villas probably has no, or very little admin backup. Maybe PS have learned lessons from Cyprus, and can tell us what will go into the contract w.r.t ongoing maintenance and management of this complex. If not, people should be aware that this could be a problem for the future.

Hi guys, I don´t think this can really be compared to Greece by any means because it is next to a booming urban centre which will sprawl outwards in time and the population is soaring in Cluj. It´s not as if it is a village ´in the middle of nowhere´ so to speak because these kind of areas can become built-up quickly and could end up being a residential type place near companies and industrial estates/business parks plus also near forest and countryside so you have best of both worlds. I´m sure this place will look completely different in 2/3 years time. In Cluj city there is less land available for building and land prices have soared and prices are already high so now people are starting to move out to surrounding villages. With regards to rental, it would of course be from workers but its good to know that a lot of rental stock in city centre is already taken up by students. I agree that the positive thing about this deal is to make a quick return in 2/3 years even if you have to be cash negative some of the time, it should pay off handsomely. In general, the payment terms are tricky in Romania too and because the market is so young, there are few big, well-known developers. So there are lots of Johnny Smith & Sons-like developers around the place! L.

Hi Also important to point out, is that the site is 14km from the city centre in Cluj Napoca. The airport in Cluj is located between the city centre and Jucu, so the site also benefits from the commercial activities going on in and around the airport. I agree with Liam that this area will be unrecognisable in 1-2 years time. There was a reason that Nokia chose this site -it is well connected to the airport and also has good access to the new A3 motorway that is under construction. Noreen

Hi again, Furthermore, I don´t think we are going to be seeing too many more of these kinds of basement prices anywhere in the European Community countries from now on. 50,000€ for a 2 bed in a key secondary city is as good as you are ever going to find anywhere nowadays because prices will rise fast in Romania as they did in Poland, as people surge to get on property ladder before they miss the boat and prices get a bit more expensive, to the point that it is out of their comfort zone with regards to mortgage repayments etc. This all means that these new builds will shift fast and prices will go up fast in next 12 months. For example, I don´t think there are any new build apartments in Poland available nowadays for such a low-entry price. Even in the most remote backwater, you can´t find those prices. And as time passes people will be looking back to the days when u could buy 50,000€ apartments which will then be worth over 100,000€. plus cluj has all the factors: work, universities, desirable place to live, beautiful surroundings, cultural centre etc etc. L.

I live in Cluj and some said back in 1999 that it was my first home. Well, it took a few years for me to get that in my head but they were right and now it is. I've seen it all. First there were the banks and then colour and restoration started to happen. Then new builds started and the expansion of Cluj was underway. Jucu is THE opportunity in Europe at the moment with General Motors this very day officially confurming their intention to establish a production plant on the same site. Others will follow of course! For direct foreign investment Romania's main selling point is low cost labour (God, I remember the MIner's strike when they marched on Bucharest!!) and the government will make sure that this wont change so low cost afforadable housing is the key to expansion of the cities. But with that comes management too. There are several 'theme' developments in Cluj which are already sold before the concrete has set. These are upmarket but Romanians with the help of banks just seem to find the money to make their dream come true. Romanian people are wonderful and have gone through hell during the years of transition ( and many still live with it). But their commitment to stay in their country and work for low wages underpins all this so please dont push prices and rents so high that the locals just cant afford - just take 55% maximum of their salary as the banks will do when they apply for a mortgage.

Charles - good to have someone on the ground that can tell it like it is. Have you visited the site of the new development? I also believe that a new 800 bed hospital is currently being built near Floresti and the Polus Centre is due to open this week. Given that the local roads are undergoing development, the Nokia employees will probably have a choice of new build apartments to choose from, from Floresti in the west to Jucu in the east...of course living only just across the road from the workplace in many (but not all) employees view would be very appealing.