From the Air Force, to shopping malls
“ Opening AFI Palace Cotroceni in such a short period of time, with around 93 per cent of its space occupied by tenants, in times of rough financial crisis, was a significant achievement for me,” Havar told Business Arena Magazine in an exclusive interview. “The main construction of this mall, after the demolition, the excavation works, and the contracting the 220,000 sqm of land, took place within 18 months, which represented a real accomplishment. Close to 5,000 people participated at some point in building this mall,” he continued.
Contracting of the land started in 2006 and construction was underway by 2008. However, work on the project remains. “We will continue to improve AFI Palace Cotroceni by renting the last seven per cent of available space; we anticipate that by the end of January next year we will fill the remaining percentage, representing some 4,000 sqm of unoccupied rental space,” said Havar.
Havar could not estimate the shopping mall’s current value, as “there is presently no yield which could be used as an indicator in the mall transactions market,” but he foresees they will increase the company’s income through their operations. Once the market stabilizes, “AFI Palace Cotroceni will arrive to a very nice amount.” He added that, by the end of next year, AFI Palace Cotroceni could contribute some 30 million Euro in income for AFI Europe. This amount could increase by as much as 10 per cent in 2011.
In addition to AFI Palace Cotroceni, the company has invested nearly 150 million Euro in equity in so far, and they intend to bolster their investments at the start of next year. “We have already acquired the land for some additional seven or eight projects to be developed by AFI Europe Romania in the future, but because of the crisis, next year we are going to start off with just two office buildings around AFI Palace Cotroceni, both of them representing 40,000 sqm, with an investment of around 40 million Euro,” said the CEO.
The second largest project, due to start in 2010, will be a shopping mall in Bucurestii Noi, with about 30,000 sqm gross area, some 20,000 sqm GLA (gross leasable area), and an investment of 50 million Euro.
Havar also mentioned the company’s other two projects in Ploiesti and Arad: “We are planning to build in Ploiesti , close to the center of the city, a new shopping mall based on the new concept of an “open-street” mall, quite popular in the West. In Arad we had also intended to build a shopping mall, but ultimately settled for a “Power Gallery” type of project located in the center of the city, where we have contracted eight hectares. Both of these constructions should start in 2011.” In addition, the company’s management is looking into the possibility of developing apartments and a four or five star hotel in the future, but is “waiting for better days.”
The financial crisis, which has caused most companies to pull back from major projects and investments, has made it difficult to secure financing for all of these projects. “The opening of AFI Palace Cotroceni was a success, and the banks present at the official opening event did take notice. Hopefully, they will make access to financing for our projects in 2010 a lot easier,” the CEO told Business Arena.
With the success of the AFI Palace Cotroceni project and the dedication of its 35-person team, the company accomplished its goal of building a mall which they describe as “the biggest in Eastern Europe, gathering a volume of 250 shops and special attractions, such as an icerink, a carting rink, a rollerblading rink, as well as waterfalls, rivers and caves under the same roof.”
For Havar, who previously worked for Pepsi Co., his job running AFI Europe has been the most rewarding of his professional career to date. Moreover, he thrives on meeting the daily challenges in the often-volatile real estate market: “It’s quite stimulating to deal with all aspects of this market. You have to be equally successful in choosing the right contractor, bringing in the tenants in a yet-unfinished project and getting them to pay you a profitable amount; as well, in obtaining the construction permits and finance from banks. You have to look three months ahead of any operation you develop, and continue to do that on a daily basis or else you might find your projects stopped.”
Favorites:
City: New York
Country:
Food: Romanian food
Bucharest Restaurant: I prefer less fancy, regular restaurants, which serve Romanian food
International Restaurant: Whenever I’m abroad, I choose a restaurant which serves Romanian traditional food
Movie: I enjoy movies from the ‘60s, such as “West Side Story”
Car owned: A Land Rover Freelander – the company’s car. But I am most passionate about my ’74 Harley motorcycle
Hobby: I enjoy flying light aircraft, a skill developed in my 25 years in the Israeli Air Force
Music: Classical
Drink: Not a fan of alcohol, but among beers, I prefer Corona
Birth sign: Pisces
Last vacation taken: In Vietnam, a year ago, with my family
Most prized possession: The values I learned during my 25 years in the Air Force
Favorite office gadget: It’s not a favorite, but it’s essential for my work – the mobile phone
Date and place of birth: February 28, 1949, .
Contracting of the land started in 2006 and construction was underway by 2008. However, work on the project remains. “We will continue to improve AFI Palace Cotroceni by renting the last seven per cent of available space; we anticipate that by the end of January next year we will fill the remaining percentage, representing some 4,000 sqm of unoccupied rental space,” said Havar.
Havar could not estimate the shopping mall’s current value, as “there is presently no yield which could be used as an indicator in the mall transactions market,” but he foresees they will increase the company’s income through their operations. Once the market stabilizes, “AFI Palace Cotroceni will arrive to a very nice amount.” He added that, by the end of next year, AFI Palace Cotroceni could contribute some 30 million Euro in income for AFI Europe. This amount could increase by as much as 10 per cent in 2011.
In addition to AFI Palace Cotroceni, the company has invested nearly 150 million Euro in equity in so far, and they intend to bolster their investments at the start of next year. “We have already acquired the land for some additional seven or eight projects to be developed by AFI Europe Romania in the future, but because of the crisis, next year we are going to start off with just two office buildings around AFI Palace Cotroceni, both of them representing 40,000 sqm, with an investment of around 40 million Euro,” said the CEO.
The second largest project, due to start in 2010, will be a shopping mall in Bucurestii Noi, with about 30,000 sqm gross area, some 20,000 sqm GLA (gross leasable area), and an investment of 50 million Euro.
Havar also mentioned the company’s other two projects in Ploiesti and Arad: “We are planning to build in Ploiesti , close to the center of the city, a new shopping mall based on the new concept of an “open-street” mall, quite popular in the West. In Arad we had also intended to build a shopping mall, but ultimately settled for a “Power Gallery” type of project located in the center of the city, where we have contracted eight hectares. Both of these constructions should start in 2011.” In addition, the company’s management is looking into the possibility of developing apartments and a four or five star hotel in the future, but is “waiting for better days.”
The financial crisis, which has caused most companies to pull back from major projects and investments, has made it difficult to secure financing for all of these projects. “The opening of AFI Palace Cotroceni was a success, and the banks present at the official opening event did take notice. Hopefully, they will make access to financing for our projects in 2010 a lot easier,” the CEO told Business Arena.
With the success of the AFI Palace Cotroceni project and the dedication of its 35-person team, the company accomplished its goal of building a mall which they describe as “the biggest in Eastern Europe, gathering a volume of 250 shops and special attractions, such as an icerink, a carting rink, a rollerblading rink, as well as waterfalls, rivers and caves under the same roof.”
For Havar, who previously worked for Pepsi Co., his job running AFI Europe has been the most rewarding of his professional career to date. Moreover, he thrives on meeting the daily challenges in the often-volatile real estate market: “It’s quite stimulating to deal with all aspects of this market. You have to be equally successful in choosing the right contractor, bringing in the tenants in a yet-unfinished project and getting them to pay you a profitable amount; as well, in obtaining the construction permits and finance from banks. You have to look three months ahead of any operation you develop, and continue to do that on a daily basis or else you might find your projects stopped.”
Favorites:
City: New York
Country:
Food: Romanian food
Bucharest Restaurant: I prefer less fancy, regular restaurants, which serve Romanian food
International Restaurant: Whenever I’m abroad, I choose a restaurant which serves Romanian traditional food
Movie: I enjoy movies from the ‘60s, such as “West Side Story”
Car owned: A Land Rover Freelander – the company’s car. But I am most passionate about my ’74 Harley motorcycle
Hobby: I enjoy flying light aircraft, a skill developed in my 25 years in the Israeli Air Force
Music: Classical
Drink: Not a fan of alcohol, but among beers, I prefer Corona
Birth sign: Pisces
Last vacation taken: In Vietnam, a year ago, with my family
Most prized possession: The values I learned during my 25 years in the Air Force
Favorite office gadget: It’s not a favorite, but it’s essential for my work – the mobile phone
Date and place of birth: February 28, 1949, .
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