BUWOG / ESG group, the residential subsidiary of IMMOFINANZ, has announced today that it will expand its business activities to foreign markets. Large-scale residential developments are planned in Central and Eastern Europe. Beginning in 2009, foreign development business shall surpass developments on the group’s home market, Austria.

According to the BUWOG management, the company will start development of at least 1,000 flats in the next year. In the medium-term, BUWOG intends to develop up to 3,000 flats per year in the CEE region. “Our 50 years long experience in large-scale residential developments at affordable prices is a perfect basis for meeting the challenges of residential developments in CEE,” says managing director Daniel Riedl.

BUWOG will realise its own projects as well, as it will form joint ventures with local and international developers. All projects will be sold entirely as freehold flats; it is not planned to build flats for lease.

There will be various cooperations with the IMMOFINANZ subsidiary IMMOEAST, too. “We expect substantial synergies and additional profits for both companies due to the perfect combination of detailed local experience in CEE with comprehensive know-how in residential developments,” says IMMOFINANZ general director Karl Petrikovics.“

BUWOG also announced its first CEE project. Together with Frankonia, the leading German developer and long-term partner of the IMMOFINANZ group, a large residential development in Poznan, Poland’s second-largest business location, will be realised. Construction for the 470 flats of “Warta Residences” will start later this year; completion is scheduled for Q4, 2009. The project volume is approximately EUR 75 million.

Other projects are already in the planning phase. Negotiations on a project with 100 townhouses and 100 flats in the Slovakian capital Bratislava are in an advanced stage. In Romania BUWOG is planning joint projects with S + B, another long-term partner of IMMOFINANZ. Projects for a total of 5,000 flats are currently under evaluation. In the Czech Republic the possibility of building flats on an IMMOEAST plot of land is also being evaluated.

The formerly state-owned residential companies BUWOG and ESG were acquired by IMMOFINANZ in 2004. The combined portfolio of the group comprises 35,000 flats with a fair value of approximately EUR 2 billion.