Category: Serviced Offices

It seems that the office market in Sofia is already part of the new tendency that is already valid in the office markets of London, New York and Dubai. The offices in Sofia city are now coming with full equipment and furnishing. The international companies which are outsourcing their business in Sofia city seem to be very happy with that as they pay more for rent, but they also get more in terms of office premise conditions and access to various facilities and amenities. According to the information presented by the real estate experts, the Sofia offices that are mostly being rented have up to ten working premises and are fully furnished with stylish working desks and are connected to fast wireless internet and digital television, as well as a fixed telephone landline.

These new and modern Sofia office centers provide additional facilities such as meeting halls that could be reserved for a certain meeting, office equipment including scanner and printing machine. The Sofia office buildings of class A are offering office premises with cleaning and maintenance of the common parts, the fees for which are included in the monthly rental price. In other words, the situation on the Sofia office market is quite good, there are still offices of the highest class A which are available for sale and rent, tempting the companies with their excellent location and full range of available facilities and services.

During the last two years it became clear to the construction companies and the real estate agents, that the offices on demand in Sofia are the ones of the highest possible quality. The companies which are looking to open their new offices in Sofia and thus to outsource their business in Bulgaria, as well as the companies which have already opened offices in Sofia and now want to relocate are all looking for a few crucial things – good location, well covered by the public transport; high quality of the office premises and balanced sale / rental price. Some of these companies have already been renting business centers in Sofia of a lower quality and now they do not wish to make compromise.

Why are the companies looking for office premises in Sofia of class A? The answer is simple – they are looking for a good balance between work and life. The good managers know that in order to keep their business running and to keep their best employees in the team, they must offer a great selection of services and comforts. If the employees are happy, then they are giving 100 % in their daily activities and the company they work for makes a profit. It is as simple as that and the sooner the companies managers understand that, the better it will be for everyone. According to the real estate agents, there will not be bigger changes in the rental levels on the Sofia office market in 2014.

The sector of the business premises and offices in Sofia is in good place now, developing with steady steps and the business seems to feel certain optimism. The characteristics of the available office buildings in Sofia and the office centers that are in progress were discussed by leading real estate agents and investors. According to the real estate agents, who are experts on the office properties market in Sofia, the future projects for the construction of office buildings in Sofia will offer around 190 000 sq.m. However, the office projects of class A in Sofia that are currently being worked on comprise of around 60 000 sq.m.

In case the rental levels of Sofia office premises remain the same in the current years, the investors will find out that there is a lack of high quality office premises. Currently, in Sofia city are available 45 000 sq.m. of offices and the real estate experts say that each year around 100 000 sq.m of new offices in Sofia are being rented or purchased by new companies on the Bulgarian market or existing companies which are relocating. Currently, the interest of the investors is focused on the office buildings of the highest class A in Sofia, which have all the required facilities and amenities to offer to the people working there, public transport and access to good infrastructure.

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.

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.

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 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.

All modern and new office centers in Sofia use the services of property management companies, which are either owned by them or hired. The property management is a though business and it is often associated with problems that arise if there is no a proper contract. The rental contract that the companies sign when renting an office in Sofia should include detailed information of the services that the property management should offer and the sum that the companies have to pay for that service.

The expenses in each office building in Sofia go beyond the monthly rent and this is normal. In addition to the monthly rent, companies that reside in a certain office center in Sofia should also cover a service charge and supplies. The service tax includes all expenses done on managing the building and associated with the business center normal everyday functioning. The companies that rent offices in Sofia are usually required to pay for security, maintenance of the elevators, common parts and installations, and for the landscaping of the green zones. The companies that are renting offices in professionally maintained business centers should ask for detailed list of the things and services they pay for. This will avoid future problems between the owner of the office center in Sofia and the company that is renting an office in this building. In general the property management fee at the office market in Sofia varies from 1.5 to 3.5 Euro/sq.m. This fee could be paid in several installments throughout the year.

In year 2013 were constructed almost 70 000 sq.m of new administrative premises and office areas. The increase is significant f compared with the situation on the office market in 2012. The new projects for office buildings that started are focused mainly on small office premises and many of them are arranged for the usage of the companies that own the land and the property. Usually these are office projects that have been prepared long time ago, but have been postponed because of the financial situation of the past few years. Still, the real estate experts say that time has to pass until the complete recovery of the office market in Sofia and this recovery will be reached once 80 000 sq.m. of new office premises are started each year.

The large office buildings that are in project have been started several years ago. Among these large projects are the business center City Tower, the construction of which is postponed. Another large project is the Millenium Center which is in construction but it goes slowly and is expected to be completed in 2015. These new business buildings are expected to bring another 90 000 sq.m of new office premises in Sofia. The office centers that are planned to be completed in 2014 include the Capital Fort project on Tsarigradsko Schousse Blvd., Grammy Complex on Alexander Malinov Blvd. and Bulgaria Towers center, which is the office part of Bulgaria Mall. Further to be completed in the third section of Expo 2000 business center in Sofia city. The new office centers in the area are expected to increase the competition, the quality and the good maintenance of these business centers in the next few years.

In the past few years in Sofia city were constructed many modern offices that correspond to the highest requirements in that sphere. The new offices in Sofia use modern technologies and special systems for reducing the expenses and allow the companies to save up to 30% on their bills. A good example of such modern office building of the highest class A is Sofia Airport Center, placed in close proximity to Sofia Airport. The business center works with an energy-saving air-conditioning and ventilation system and with an automatic system for building management. Thanks to these two systems, the building has constant level of temperature between 22 and 24 degrees, which is believed to be best for the health and the tonus of the employees. Thanks to the good ventilation of the building and the fresh air that comes in the premises, the employees get ill 39 % less than the employees working in the old congenital office buildings. Many of the new and modern office in Sofia have such management and ventilation systems and provide more daylight in the office premises, which has positive effect on the employees.

The most sought after office buildings in Sofia are situated along the two main boulevards – Bulgaria and Tsarigradsko Schousse. There is also interest towards the area along “Cherni Vrah” Blvd., which is now serviced by the new metro line. At the same time there is also interest towards the Sofia offices near the Business Park in Mladost and near the Ring Road. The rental levels of Sofia offices remain stable and vary in the price range of 8-12 Euro/sq.m.