Monthly Archives: August 2016

In the last few years it is the technology sector that runs the office market in Sofia city. The main clients that are renting the class A offices in Sofia are the companies from the outsourcing and the IT sector, as well as international companies for shared services. These companies participated in 45 % of the signed deals for rental of office premises in Sofia in 2015.

There is a serious demand for good offices with central location and proper facilities. At the same time however Sofia has only 12 % offices of class A and B that are still available. At the same time, the office buildings that have been put into usage since the beginning of 2016 are around 13 500 sq.m. The expectations are for another 50 000 sq.m of offices to be released in Sofia city in 2016, while in 2017 the number of newly built Sofia offices is expected to be around 110 000 sq.m.

More than 20 % of all deals for renting office premises in Sofia are done for offices that are located in business centers that are still under construction. This became a reality since there is a lack of proper office premises available for rent on the market. The rental levels of offices of class A are ranging between 12 and 14 Euro/sq.m.

The companies that drive the market are coming from the IT and the outsourcing sphere, as well as from the sphere of shared services. The prognosis are for an increased supply of offices in the years ahead. The office space in Sofia that is planned to be completed in 2016 is around 80 000 sq.m, while the planned office premises in Sofia, Plovdiv and Bourgas cities for 2017 are around 240 000 sq.m.

The quality office projects of class A in Sofia is well distinguished from the offices of the lower class B. These new office projects are the ones that are in the focus of the foreign investors.

The increase in demand of office space in Sofia in 2015 has been carried over into the first six months of 2016, which means that the office market is operating at a very high speed. The newly-formed companies in Sofia were and still are looking for an office space of 200 sq.m, while the companies that have been on the market for a while are in search of offices between 700 and 800 sq.m. The usual tenants are companies that operate in the financial, outsourcing, pharmacy and IT sectors, which mainly serve clients from abroad.

This increased demand for office space increased the occupancy levels in the office buildings, especially in those business centers with good location and excellent transportation links. Currently Sofia city has several high-class office projects that will soon to become operational and that will increase the supply of new offices in the city. The rental levels of the available office space of class A in Sofia are between 10 and 13 Euro/sq.m. Serious changes in the rent levels are not expected, as all landlords are willing to sign long-term deals. The prognosis of the real estate companies is for this high demand office tendency to continue in the months ahead. The office market in Sofia is expected to be quite busy in the next two years.

The Prime Minister of Bulgaria sees the lack of Bulgarian’s accession to Schengen as an injustice and hopes this will end soon. He expressed his thoughts after a meeting with the Prime Minister of Romania, in early June. The Bulgarian Prime Minister further expressed his gratitude to his Romanian colleague for the excellent estimate that Bulgaria received.

Boyko Borissov further stated that Romania and Bulgaria are absolutely ready to join the travel-free zone of Schengen and that they do even better than many countries that are already members of the Schengen zone.

The Prime Minister of Bulgaria stated that the country wants a no visa regime for Canada and the United States, but most of all Bulgarians want their interests to be protected. This includes traveling with no visas in the Schengen area as well. He further stated that Romania and Bulgaria have already invited the Canadian ministers to visit the two countries and to get acquainted with the Schengen system.

The Information Technology industry in Bulgaria is among the fastest growing ones in the country for more than three decades already. Today, this industry enjoys a two-digit rate according to the European Information Technology Observatory and this grow is expected to continue. Five years ago, Bulgaria has been ranked as the most competitive country in the IT Industry in Southeastern Europe.

Currently Bulgaria is among the leading countries with multinational corporations opening offices in Sofia – among which being CISCO, VMware, SAP, HP, Atos, ProSyst, etc. This means that these companies can find in Bulgaria excellent technologies, well-prepared professionals and Class A Sofia offices at affordable prices. Not to mention that Bulgaria has the second fastest broadband internet.

The offices that these IT companies are looking for are spacious, with many onsite facilitates, and great location covered by the public transport network of Sofia city. And since the average monthly salary in the software industry is considerably low compared to the rest of the countries, Bulgaria seems like a great place for outsourcing the business that the IT companies have. The IT industry in Bulgaria is quite promising, with potential to yield high returns in the years to come.