The demand for spacious offices of class A in Sofia city is so serious that currently are being signed rental contracts for office premises located in business centers that are still in construction and are expected to be completed in 2017. The pre-lease of office premises in Sofia city is something normal today and if 70 000 sq.m of offices are to be ready this year, the rest will be completed in the first half of the year ahead.
The average size of the office premises that were rented in 2015 was around 1200 sq.m. and the tendency is for the companies to look for even larger offices. This indicator confirms the positive tendency for renting bigger offices in Sofia thanks to the serious business growth of the companies in the outsourcing and the IT sphere.
In the end of January the Bulgarian President Rosen Plevneliev gave an interview for the Italian newspaper Corriere della Sera. In the interview, the Bulgarian president stated that the European continent has already faced enough xenophobia and lack of tolerance that caused many wars and a lot of destruction. He said that today, in 21st century we need better and new ideas and that is why in his interview he called on all his colleagues in Europe not to leave behind the vision of Europe with no internal borders.
The Bulgarian President stated that the Schengen zone has made all Europeans’ dream of free traveling in Europe with no barriers. He pointed out that when times are difficult people should follow their dreams and not be guided by their fears. He also stated that the European Union was established in the name of peace preservation. Now that pace can be guaranteed only when the European nations cooperate and integrate with one another.
Rosen Plevneliev stated that once Bulgaria became a member of the European Union, it stepped on the right track and made a huge progress. Today the country plays an important role and is handling the refugee crises properly with no contradiction between the protection of EU external borders and the human rights respect.
The main tendencies concerning the office market in Sofia in the last quarter of 2015 included an active search for office premises and a slight increase in the rental levels. The increased interest for company expansion and rental of offices mainly by the IT and outsourcing companies led to many new office projects.
According to data offered by Forton, in 2015 were completed more than 105 000 sq.m of offices, most of which however were rented before the office buildings got permission for usage. Due to that fact, the quality provision of offices remains insufficient and cannot answer the serious demand for office premises in Sofia. The average size of the rented offices in 2015 was around 1200 sq.m.
Currently 200 000 sq.m of office premises are being in process of construction in Sofia yet only 70 000 sq.m are expected to be completed in 2016. The active demand for offices and the limited supply of suitable office premises led to a slight increase in the rental levels of the offices of class A, which now start at around 12.5 Euros.
Following a meeting with the Bulgarian Prime Minister, the Hungarian Prime Minister Viktor Orban stated that if Europe wants to be correct with Bulgaria, it has to offer the country a Schengen membership. He further stated that it is not right that the results of Bulgaria concerning the refugee crises are not acknowledged. After all, Bulgaria is a non-Schengen country that has shown the best results.
The Hungarian Prime Minister Viktor Orban said that all countries that are along the routes of the migrants are under stress. He also said that Bulgarian authorities are handling that stress in the best possible manner and that is why the country should be offered a Schengen membership will full rights. He also stated however that the country should carefully consider whether or not she wants to join the Schengen agreement zone, which in his words is dying.
The total square meters of Sofia offices that are expected to be completed in 2016 are not many, according to data released by the real estate agencies. However, the experts say that many more projects are in the pipeline to be completed by 2017. The office market in Sofia is mainly driven by the companies working in the outsourcing sphere, in the sphere of Informative Technologies and Pharmaceutical Business. Bulgaria and especially its capital Sofia are already well-known to the companies worldwide, as the country has excellent reputation for qualified professionals, normal wages, and modern offices of highest quality.
In year 2016 Bulgaria took the first place among the countries in the European Union concerning business deals signed. Based on that, as well as on the number of deals and the requests made, it is believed that the focus of the investors will broaden and will include Bulgaria. In 2015 only one large office project was released on the market – Capital Fort on “Tsarigradsko Schousse” Blvd. the rental levels of the high quality offices in 2015 were among 10.5 and 12.5 Euro/sq.m.
In the current year of 2016 the expected number of office premises to be released is around 63,000 sq.m, yet the prognosis for the completed office premises in the year to follow is for 170 000 sq.m. The office projects in Sofia to be released soon are yet to change the office market in the capital of Bulgaria. The rental levels of the offices are expected to go up and start from 12.5 Euro/sq.m and going up.
During the ditional reception for heads of diplomatic missions accredited in Bulgaria, at the end of January the Bulgarian President Rosen Plevneliev stated that Bulgaria has been a factor if stability in the region during the past year. The event has organized at the National Museum of History, where the President Plevneliev delivered his speech. According to him the year 2015 was difficult, the countries were unstable and the events could not be predicted.
He stated that despite all the challenges, Bulgaria has been acting as a factor of stability in the entire region, playing a responsible role as a pro-European force on the Balkans and further, as a responsible EU and NATO country. The year was also active concerning the Bulgarian foreign policy. And even if the people respect the refugees, they do protect the borders of the country and of the Schengen zone as well. That is why according to the president of the country, Bulgaria has been a source .not of problems but of solutions.
The ambitions of Bulgaria are associated with launching a new wave of European integration projects including euro zone membership and Schengen zone full-rights membership. The Bulgarian president further stated that the European Union is a platform for countries to develop and that Europeans need a good debate on achieving peace and pointed out that Bulgaria is an important factor for that on the Balkans.
He stated that the country’s international prestige is recognized by the fact that the country is taking over the chairmanship of the South-East European Cooperation Process (SEECP) and of the Committee of Ministers of the Council of Europe and that Bulgaria will be hosting the Arraiolos meeting in 2016.
The uplifting in the sphere of construction was a fact in all segments of the market in 2015. The investors started new residential and office projects, as well as major multifunctional projects. The prognosis of the experts is for this tendency to proceed in year 2016 as well. Bulgaria is already a well-established outsourcing destination, which presumes an increase in the search for business premises and offices of class A. The main participants on the office premises market are the outsourcing and the IT companies.
The real estate agents say that in 2016 only 63 000 sq.m of new offices will be completed. Yet, they are also talking about others waiting in the pipeline as in 2017 are expected as many as 170 000 sq.m of office premises. Many of these premises are expected to be pre-released. The large office projects that are expected on the market include The Green Offices Kambanite, Blu Offices, The Building 1 of the Trade Center Europe, Millenium Center and City Tower, Phase 2 of the Sofia Airport Center, Garitage Park, as well as Phase 2 of Sofia One and Phase 4 of Expo 2000.
In the beginning of the year the Bavarian Minister of the Interior for Building and Transport Joachim Herrmann stated during a press conference that in the frames of the Security Priority Area of the EU Strategy for the Danube Region, there is no intention of turning Bulgaria and Macedonia into “waiting room for refugees”.
The Bulgarian Deputy Prime Minister for Coalition Policy and Public Administration and Minister of Interior, Rumyana Bachvarova, took part in this event dedicated to counteracting international terrorism. She remarked that Bulgaria protected its border in line and in accordance with all Schengen standards. She also stated that the country has the technical readiness to join the Schengen Area ever since 2012.
She further said that Bulgarians understands the situation in Europe and that meeting our obligations is more important than insisting on additional rights our citizens. The question with the Schengen membership remains open for the country.
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