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Announcing strong investment in a competitive market

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By Claudia Ariton
Few people in Romania know the real estate market as well as Shimon Galon, the CEO of Real-Sol. Although he is an expat, he has been more connected to the trends and rhythms of the Romanian real estate market than many local business people and entrepreneurs. The former CEO of GTC, the developer of America House and City Gate, Shimon Galon has seen and experienced all the fluctuations in this market. He has been an active investor in Romania since 1999, and, in his 20 years of activity, this veteran of the real estate industry has lived through both the highs and the lows of various real estate market segments, such as retail, residential and office.
Now, Shimon Galon is again in the limelight with his four new ambitious projects. Real-Sol, the administrative and management company he founded in 2014, has embarked on a long-term journey: it is set to develop new residential projects in Bucharest and Craiova. This means he and his team are preparing the delivery of some 370 apartments, with over 30-million-euro in investment. Galon’s company has specifically chosen the two cities due to their “high real estate potential.” Asked to elaborate on his decision to develop projects in Craiova, the Real-Sol CEO explained: “Our decision to invest in Craiova has been based on aspects such as the increase in the local employment rate, the arrival of international investors that have opened operations there in the last few years, and the introduction of direct flights to the city. All of these are part of a strong economic activity in the city and the region. The company is also involved in two projects in Piatra Neamt and Constanta, respectively, as we consider that those cities offer a great potential for the residential market.”
The first residential project of the 30-million-euro investment plan is located at Pipera. It is strategically placed to be close to offices and retail hot spots. This three-million-euro residential complex will offer apartments in one large building, each apartment having its own entrance, so the residents can have the privacy they need, the CEO explained in an exclusive interview with Business Arena. The second project is located in the Sisesti area, a neighborhood in northern Bucharest. The six-million-euro investment will provide larger apartments, within a private and secure community.
Then, there is the third project, which will deliver boutique-type apartments in the Gara de Nord area of Bucharest. Some four million euro will be invested by the Real-Sol in the completion of this residential facility. “We are talking about a unique project for the center of the city, which after a long round of negotiations, will reach the completion phase. The residential project will be developed in a historic building in Bucharest, which will be adapted to modern living standards,” said Galon.
Finally, there is the residential project in Craiova, a 20-million-euro investment, which will be located in the proximity of one of the largest parks in central Europe, the Nicolae Romanescu Park. Fourteen blocks of flats will take shape here, developed by Real-Sol from the beginning of autumn 2019. “All these four projects are in their initial development stages, after we have finished with the design concept and obtained the building permits,” the CEO told Business Arena.
We couldn’t help but wonder what makes Real-Sol stand out from other competitors on the real estate market. Shimon Galon points out that the answer lies in the activity of his company. “Real estate development is a complex business process, encompassing a wide range of activities from technical, financial, and legal operations to property management and marketing. A developer’s success depends on the ability to coordinate and lead the completion of a series of interrelated activities efficiently and on time. Our company coordinates all technical, financial, legal, property management and marketing activities, managing the whole process from the beginning to the end, converting ideas from paper to real property by offering all the services under one umbrella. So, for the Real-Sol projects, the most important added value stems from the possibility to have all the services in real estate segment under one roof, providing all the services, based on a vast experience on the Romanian market.”
It’s exactly this experience on the local market that helps the company adapt to the different segments of the real estate industry, depending on the opportunities, added Shimon Gallon, who has a long experience in international real estate development procedures. He has built his expertise over many years, managing entities from the initialization process until the actual exit. He gives as example other important projects that he has been involved in as an entrepreneur, one of them being the recent development of the Park Inn Hotel in the Polish city of Poznan, a hotel under the management of the Radisson chain. “We developed the hotel in Poznan, because it was a great and outstanding opportunity. In parallel, we are involved in two hotel projects in Bucharest. The other two projects that we are focusing on right now are the completion of a 500-apartment residential complex in Riga, Latvia, and a residential project of over 250 apartments in the Mihai Bravu area of Bucharest.” 
The company managed a 150-million-euro portfolio last year, and in 2018 Galon expects a value of 250 million euro. “Twenty employees work at the Real-Sol headquarters and we have teams of two or three employees at each of our projects. In total, we have about 45 people on our payroll,” said Galon, adding that “the company started based on the idea that the real estate development is always a multi-professional challenge. We have created one point of contact where all the real estate services are available under one roof. The customers, therefore, can have access to all the relevant activities: due diligence, design, contracting, site supervision, marketing and sales, and exit.”
Although Real-Sol is active in Poland, Ukraine, Bulgaria and the Baltic countries, the management has announced Romania as its main focus. “Romania is the main focus because the founders are active on the market since 1999, being responsible for the development of major projects such as Europe House, America House, City Gate, Rose Garden, four shopping centers and so on. The residential market in Romania continues to be very attractive for investors, as the prices are now situated at a good level for the both parties involved (the investor and the buyer). So, the demand, which is currently on the rise in certain areas, is ensuring a quick and successful finalization process for the projects. We tend to pay extreme attention to the location when developing our projects, but also to the facilities, the technical construction details and the structure of the apartments. If you overlook any of these aspects, then you will need time and extra costs to overcome the problems that may occur,” said Shimon Galon.
With an eye for good investments and a rich experience, Galon is a man for whom the industry holds no secrets. However, what are the challenges that he needs to deal with on a daily basis? “The development of the company in different countries is a challenge that requires a lot of effort and is our main present priority,” he discloses, pointing out that some market segments hold more potential than others at the moment. “For private investors, the most attractive segment in the real estate at the moment is the residential segment, based on a high demand and a positive financing trend. For institutional investors, as usual, long-term results are more preferable, being an important element in the investment market. In this segment, storage facilities are today the most profitable elements.”
Does he have any dissatisfactions? Certainly, investors in this market have listed many problems. “The main difficulties on the market are the lack of workers and the very challenging approval procedures,” he says.
Leaving difficulties aside, he sees his company as the end result of a long process of work and rewarding efforts. “The biggest success we have ever had in Romania so far was to create a company which manages projects of hundreds of millions of euro in just four years. That was made possible by creating a team able to deal with any real estate development on the market.”

The interview is also available in our print edition of Business Arena.

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