Romania Construction Market Size, Trend Analysis by Sector (Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential) and Forecast, 2023-2027

Romania Construction Market Size, Trend Analysis by Sector (Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential) and Forecast, 2023-2027

Summary

The construction industry in Romania is expected to grow by 2.5% in real terms in 2023, following an annual growth of 11.2% in 2022. This deceleration in growth is attributed to weakening base effects, coupled with the ongoing Russia-Ukraine conflict and weakening global economic conditions, which are continuing to keep construction costs elevated and investor confidence low. The industry is expected to face further headwinds over the course of this year due to high - albeit decelerating - inflation and rising interest rates, which could negatively impact demand and project financing, particularly for residential construction. So far, this has been reflected in the data for building permit issuance for residential properties, which fell by 4% QoQ in the first quarter of 2023 in seasonally adjusted terms, compared to a rise of 19.4% for non-residential buildings. However, the overall level of building permits issued rose by 12.8% QoQ in Q1 2023, suggesting that despite the headwinds, activity in the sector will be partially sustained. Moreover, activity in civil engineering has continued to rise, posting growth of 23% YoY in Q4 2022, according to the latest available data. Infrastructure and institutional construction are expected to remain strong throughout the year owing primarily to EU Recovery and Resiliency Facility (RRF) funds, of which, Romania has the second highest allocation in terms of percentage of GDP, at 13.1%, or RON170 billion ($33.3 billion). The funds will help to support projects in the health, education, energy, and transport sector over the next four years.

Over the longer term, the Romanian construction industry is projected to grow at an average annual growth rate of 4% between 2024 and 2027, aided by infrastructure development in highways, energy, and commercial projects. As part of the Casa Verde Fotovoltaice Program, the country’s Prime Minister announced an allocation of RON3 billion ($620.7 million), in February 2023, to boost residential solar installations by individual households. With this investment, the total installed capacity is expected to reach 6.1GW by the end of 2026 from 1.8GW in 2022. In addition, the European Investment Fund (EIF) and the European Investment Bank (EIB) signed a RON5.3 billion ($1.1 billion) loan agreement, in March 2023, to support new investments across Romania. This amount will be utilized for the construction of a new regional hospital in Craiova and the reconstruction of another 26 smaller hospitals and medical facilities across the country. It will also be utilized in the construction of universities in Targu Mures and Cluj-Napoca and support the upgradation of roads for safety purposes across the country.

This report provides detailed market analysis, information, and insights into the Romanian construction industry, including -

• The Romanian construction industry's growth prospects by market, project type and construction activity
• Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in the Romanian construction industry
• Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.

Scope

This report provides a comprehensive analysis of the construction industry in Romania. It provides -

• Historical (2018-2022) and forecast (2023-2027) valuations of the construction industry in Romania, featuring details of key growth drivers.
• Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
• Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
• Listings of major projects, in addition to details of leading contractors and consultants

Reasons to Buy

• Identify and evaluate market opportunities using GlobalData's standardized valuation and forecasting methodologies.
• Assess market growth potential at a micro-level with over 600 time-series data forecasts.
• Understand the latest industry and market trends.
• Formulate and validate strategy using GlobalData's critical and actionable insight.
• Assess business risks, including cost, regulatory and competitive pressures.
• Evaluate competitive risk and success factors.