Realtors from leading real estate agencies in Bulgaria confirmed that the interest towards the rental and sale of offices in Sofia is increasing. The investments made in the region of Central and Eastern Europe are getting more serious and this means that new companies will soon open offices in Sofia. These international companies have excellent reputation and developing business with a lot of potential and naturally they are looking only for the best offices for rent. Will Sofia city be able to offer such office buildings?
In the current year in Sofia city are expected to be completed two very large business centers in Sofia of class A, which will answer to the demand of the investors. These two projects are one of the office towers part of Bulgaria Mall and Capital Fort. There was a pre-launch of the office premises in these two office buildings in Sofia as any new companies have already rented offices there. This is a signal to the realtors that the office market situation in Sofia is improving but also a sign that the number of the available high-quality large office premises in the existing class A office buildings in Sofia is decreasing.
The areas in Sofia city that provoke the interest of the investors and foreign companies that wish to start business in Sofia are placed near the Business Park Sofia, along Tsarigradsko Schousse Blvd. and Bulgaria Blvd. There is still interest in offices in the center of Sofia, but there are not many large office premises available for sale or rent there. The rental levels of the offices of high class in Sofia city remain stable.
Bulgaria became a member of the European Union in the beginning of 2007 and by 2011 it was ready in technical terms to enter the borderless travel zone of the Schengen agreement. Several of the founding members of the Schengen zone however opposed to the enlargement of the visa free area and the newcomers Romania and Bulgaria. One of the countries that severely opposed to Bulgaria entering the Schengen area is the old member country The Netherlands. The country stated that it will lift its veto if Bulgaria receives two monitoring reports under the Cooperation and Verification Mechanism from the European Commission which are positive. Until that very moment, neither Bulgaria, no Romania have received such positive reports from the Cooperation and Verification Mechanism committee.
The Foreign Minister of Bulgaria, Mr. Christian Vigenin hopes to have good discussions with the other member states in the European Union on the future of the Cooperation and Verification Mechanism. He commented that he expects such discussions to take place once the new commissioners take over. The Minister hopes to discuss with the commissioners how Bulgaria complies with that mechanism ad if it works in the proper way to achieve results. Mr. Christian Vigenin further said that he expects the country to enter the travel free Schengen zone by year 2018 when the country is expected to take over the European Union rotating presidency. He said that the Bulgaria is ready to solve all its issues and become part of the Schengen agreement even sooner than that timeframe.
The real estate managers dealing with Sofia office premises confirm that there was an increase of 45% in the rental of offices in the capital of Bulgaria during year 2013. The increase in the interest towards the office buildings in Sofia was due to the expansion of certain companies that already take a place on the market. Realtors predict that this tendency will continue and during the current year the rented office premises of class A in Sofia will exceed the ones rented in 2013 which reached 110 000 sq.m. In 2014 the real estate agents predict that the office market will get new tenants – modern companies with serious plans for development and growth in the next two years. Currently are available enough office premises in office buildings of class A, which correspond to the international requirements, even though their number is decreasing with fast pace. This is so as there are not many new projects for the construction of office buildings of class A in Sofia.
Which are the requirements of the most active companies on the rental market of Sofia premises? The international companies which are relocating their business and are outsourcing part of their activities in the capital of Bulgaria work in the sphere of pharmacy, telecommunications and energetics. These outsourcing companies are looking for Sofia office premises with size that varies from 200 sq.m. up to 9000 sq.m. The tenant companies require flexible conditions on the rental contracts, functional layouts, proximity to trade areas, service zones and public transport. Such projects are Serdika Offices, European Trade Center, and Bulgaria Mall.
After several years of preparations and hopes, on 20th January this year Bulgaria admitted that its entry into the passport free travel zone of Schengen will most probably take place in three or four years period. According to information provided by the Foreign Minister of Bulgaria, the country is invited and is expected to enter the borderless Schengen area in 2017 or 2018, when the country will also take over the rotating Council presidency of the European Union. The Minister of Foreign affairs said that he expects the decision which concerns the bid of Bulgaria to be taken in 2014. The minister hopes that the air borders of the country to open in 2015, followed by opening of the land borders in 2017. This means that Bulgaria is expected to become a full member of the Schengen area by 2018. This plan for Bulgaria to enter Schengen is seen by the minister as realistic.
In 2007 Bulgaria joined the European Union and three years later the country was technically ready to join the travel free zone of Schengen. Actually, the country hoped to enter the Schengen agreement in 2011. Unfortunately for Bulgaria, several of the founding members of the Schengen agreement, in particular Germany and the Netherlands, opposed to the newcomers in the face of Bulgaria and Romania and they have successfully used their veto on several occasions.
Sofia city is a wonderful business destination for the large international companies, which plan to outsource their call centers and part of their services and practices to a more affordable destination. Sofia is the only European capital where these companies are able to rent offices and entire business centers for a monthly rental price ranging from 4.5 to 12 Euro/sq.m. Among the affordable office buildings in Sofia city is the Benchmark business center on Tsarigradsko Schousse Blvd. with its office premises of 17 500 sq.m. The office building was completed in the beginning of the financial crises and had difficulties finding tenants due to the high rental levels. Today the rental levels are normal and the business center is welcoming new companies from all spheres of business since it has excellent location interesting architecture and spacious atrium which adds to its charm and which could be used for hosting exhibitions and various events that will improve the working environment.
Another business center that is trying to gain the interest of the big companies and find tenants is the Vertigo Business Center in the district of Manastirski Livadi-Iztok. The office building has an impressive architectural form and is placed near Bulgaria Blvd. Those companies whose sphere of business requires them to be close to the Sofia Airport can rent offices in Sofia in the Black Diamond Business Center near Georgi Asparuhov Stadium or in the new office building near Domko Hypermarket on Vladimir Vazov Blvd. The office buildings that are new and waiting to be rented by business companies from Bulgaria and abroad are 25 in number with usable area of 130 000 sq.m. where 75 % of that brand new office area is vacant.
The President of Bulgaria Mr. Rosen Plevneliev attended a joint press conference with his Estonian counterpart Mr. Toomas Hendrik Ilves. The conference took place during the official visit of the Estonian President in the Bulgarian capital, Sofia city. As Focus News Agency informed, the President of Bulgaria confirmed that Bulgaria appreciates the support of Estonia for Bulgaria’s wish to become part of the Schengen area. The Bulgarian President Mr. Rosen Plevneliev further stated that Bulgaria and Estonia are working together in NATO, where the two countries are honorable members.
The two presidents of Bulgaria and Estonia made time on their joint conference to reassure the press that they will proceed and even strengthen the cooperation between two countries. Bulgaria and Estonia plan to work together in the cyber security field and to cooperate in the cyber defense center of NATO in Denmark. The head of the state, Mr. Rosen Plevneliev further expressed his vision for the two countries to support the policy on enlargement with the other Western Balkan countries and to support their bid for integration in the European Union. That is why it comes as no surprise that Estonia stands strong behind its support offered to Bulgaria as far as Schengen membership is concerned.
The modern Sofia offices are following the tendencies of leading European countries, aiming to offer excellent working conditions, results oriented facility management practices and optimization of the expenses. According to the chairman of the European facility management network, the financial difficulties in the past few years have had an impact on the office market in Bulgaria and all over Europe. Today the office premises are used more wisely, the living space is optimized and many efforts are made for the employee productivity in the offices to be increased. Today this is possible with a deep analysis of the business specifics, optimization of the working processes and implementation of new and modern technologies. The effective usage of the office area in Sofia is associated with good understanding of the working processes there.
In the past many Sofia offices were designed in such a way as to offer a large study for the manager, which was not fully used since the manager is often traveling or outside meeting business partners. Before the crises the employees were not feeling comfortable using that office area in Sofia for the purposes of the meeting. Today, many employees are arranging meetings with important clients in the cabinet of the manager when the manager is away and this is no longer strange or taboo. The optimization of the expenses of the offices in Sofia is very important, but this does not mean that the office “kitchen” or the coffee room should be cut. On the contrary, these areas make the colleagues and office employees communicate, solve work tasks in more informal environment and thus improve the working climate in the company in general.
The Foreign Minister of Bulgaria, Mr. Christian Vigenin informed that it is most likely that Bulgaria will receive an invitation in order to become a member of the Schengen travel free zone. According to the expectations of the minister, this is supposed to be a final decision based on solid and well considered observations. The Foreign Minister informed the Bulgarian society that he expects that the opening of the Schengen travel free zone will be done in two stages. The first stage of the Schengen opening would be by air and later on, the second stage would be by land. Naturally, this opening of the Schengen passport free travel zone will be done later and not automatically. Most probably Bulgaria will become a member of the Schengen agreement in several years period. According to the Foreign Minister of Bulgaria, Mr. Christian Vigenin, Bulgaria will enter Schengen visa free zone by year 2018.
Currently Bulgaria is not part of the Schengen zone, yet de facto and even not de jure, Bulgaria feels as part of the Schengen zone. This is so as the country is applying all the regulations and rules validated by Schengen. By year 2018, the minister expects the European Union monitoring on the Bulgarian judiciary system to be removed. He also believes that at that time Bulgaria will keep the presidency of the European Union. The Foreign Minister was on an official visit in Britain, where he was assured that no discrimination rules shall be applied to the Bulgarians working there.
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