It was a Wednesday afternoon when WhatsApp pinged. A message from Amir, an Israeli real estate developer whom we accompanied into the Romanian market. “I'm in trouble. Big. Need to talk now.”
As a lawyer who accompanies developers and investors in international real estate, I already know that when “now” arrives in a WhatsApp message, the situation isn't simple. Eight months earlier Amir had purchased an old building in the center of Bucharest, the capital of Romania. The plan was simple: renovate, divide into apartments, and rent to local tenants and expats.
“The municipality stopped my works,” he said on the video call. “They say I can't change the apartment layout without approval from a heritage committee. What heritage committee? This building was built in 1987!”
Amir is a type I know well. Age 52, built more than 200 housing units in Israel. Successful, made good money, and decided to expand to Europe. “Why Romania?” I asked him at the first meeting almost a year ago. “Bucharest is an opportunity,” he explained, “low prices, high demand, and a lot of Israelis are already making money there. I saw the numbers, it makes sense.”
I warned him then. “Amir,” I said, “real estate in Europe is not real estate in Israel. Every country is a different world. There is different regulation, a different work culture, and laws you don't know.”
He gave that typical smile. “What could be so different? I know real estate. I bought right, I have a healthy margin, and I have a good local contractor. I'm covered.”
The first crack
Amir's problem began long before the heritage committee. It began when he stood with the Romanian contractor and tried to explain how he wanted the renovation carried out.
“I want to open this wall,” Amir pointed at a wall between two small apartments. “We'll make one big apartment out of it, more attractive for the market.”
The contractor looked at him, nodded, and said “Da, da” (yes, yes in Romanian). Amir thought everything was fine.
Two weeks later, when Amir arrived for a surprise visit to the site, he discovered that the contractor had not only not opened the wall - he had stopped all the work on that floor. “Why?” Amir asked in frustration.
“Need approval,” the contractor explained calmly. “This change, it needs to be approved.”
“What approval? I'm the owner!”
The contractor took out a long document in Romanian and showed him. It turns out that in buildings constructed in the Communist period (before 1989), even if they are not registered as historic structures, there are restrictions on structural changes. You need to get approval from the municipality, which in turn refers you to a special committee that checks whether the change is “consistent with the character of the original building.”
The process? Four to six months. Minimum.
“Four months?!” Amir almost shouted. “In four months I lose the whole season!”
Yes, but in Romania, and in Europe generally, bureaucracy is queen.
The tenants who spoke English (almost)
But the story didn't end there. Suppose Amir had managed to get all the approvals (and eventually he did, after seven months), he faced an entirely different challenge: the tenants.
The first apartment was rented to a young local couple. Everything looked excellent. They signed the contract, paid a deposit, and moved in. A month later, they called to say the air conditioner didn't work.
Amir called a technician, who came and said the air conditioner was perfectly fine. The problem? The tenants didn't know how to operate it. It was a new air conditioner with a smart remote, and the instructions were only in English.
“Why didn't they read the instructions?” Amir asked in frustration.
“Because in Romania,” I explained to him, “not everyone reads English fluently. And if you rent to locals, you have to provide operating instructions in Romanian. It's not a request, it's an obligation under the consumer protection law.”
But that was only the beginning. When winter arrived, the tenants complained that it was cold in the apartment. It turns out that in old buildings in Romania, the city's central heating system operates on a set schedule, and doesn't always supply enough heat. Amir didn't know this when he bought the building.
“So what do we do?” he asked.
“You install electric radiators or a supplementary heating system. And you pay out of pocket.”
The moment everything changed
After a year, when Amir sat across from me in the office, he looked different. More tired, but also wiser.
“Listen,” he said, “there's one thing nobody told me before I entered Romania, and truth be told, any foreign market.”
“What?” I asked.
“That this Israeli approach of ‘what could happen in real estate? It always goes up, more or less’ is simply not true abroad. In Israel, you make a mistake, you lose a bit of time, a bit of money, but in the end you come out ahead. The market always goes up, there's always someone who will buy.”
He paused and sipped his coffee.
“But in Romania? In Bulgaria? In Greece? Anywhere abroad, if you don't know what you're doing, you can lose everything. The capital, the time, and the faith in yourself. I've seen Israeli developers who went into Portugal or Cyprus with millions, and came out in debt. It's not a game.”
The questions nobody asks
So what did I learn from Amir and from dozens of other clients I accompanied in European markets? That before you jump into Romania, Greece, Portugal, or any other market abroad, there are questions you must ask yourselves:
Do you truly want to deal with this yourselves, or is it a “side deal”?
Because if it's a side deal, forget it. Real estate abroad requires daily involvement. It's not something you can do remotely without a professional local team. And even with a team - you need to be there, at least at the beginning.
How involved will you be when something goes wrong?
Because it always goes wrong. Always. A contractor who doesn't show up, a tenant who stops paying, regulation that changes overnight. The question is: can you fly to Bucharest, Athens, or Lisbon on three days' notice? Because sometimes there's no choice.
Do you have local partners you truly trust?
Not someone recommended to you in some Facebook group. Someone you checked, met, and worked with long enough to know he is reliable. In Romania, Bulgaria, Greece - without a good local partner, you are blind.
Do you understand the local culture?
It's not only language. It's how contractors work, how negotiation is conducted, what “yes” means (because sometimes it isn't really yes), and how government systems operate. In Greece, for example, bureaucracy is legendary. In Portugal, every change to a historic building requires approvals that take years.
And what happens if everything goes wrong?
This is the question nobody asks, but it is the most important. Do you have a financial cushion? Are you prepared to take a loss? Because unlike Israel, abroad there is no guarantee that you'll manage to sell, that the market will rise, or that you'll manage to recover the investment at all.
The end (which is a beginning)
Amir today? He is still in Romania. The first project took him two years instead of nine months, and cost twice what he planned. But he learned. Today he has a Romanian partner and a maintenance man who lives in the building.
“I know Israeli real estate,” he told me recently in a conversation, “but in Romania, and probably anywhere abroad, I will always be a student.”
And that is exactly the right approach to international real estate entrepreneurship. Not “what could happen,” but “what don't I know yet, and how do I learn it before I invest.”
Because in the end, the difference between a developer who succeeds abroad and one who loses everything is not capital, not experience, and not even luck.
It is the willingness to admit that you don't know, and to learn from the beginning.
Stories are based on real situations, with identifying details changed. Not legal advice.
Translated from the Hebrew original. עברית