Bulgaria is prepared to become a member of the travel free territory of the Schengen agreement as the country has taken all the necessary measures including the application and usage of the Schengen Information System. Thank to this mechanism, the judicial authorities and the national border control of the different countries can collect information on the objects and persons.
Bulgaria hopes to become a member state of the Schengen zone and with that to supply the necessary information to the system through the national networks that are connected to the central system. It is important to mention that the Schengen area is within the institutional and the legal framework of the European Union. Due to that it comes under the judicial and the parliamentary scrutiny, encouraging the free movement of people as well as the parliamentary control.
Sofia office market showed signs of recovery, marking the path for the other property markets in the country to follow. The total number of rented offices in Sofia reached its highest peak since 2008 and for the first time in the last five years as the world financial crises have started exceeded 100 thousand sq.m. According to the real estate and financial experts, this is a very good indicator that there is movement in the economics, more activity from the investors and many international companies from the IT and the outsourcing sector willing to relocate their business to Sofia.
Year 2013 was very important for the office market in Sofia. Many foreign companies invested in office space in Sofia and outsourced some of their activities to Bulgaria. According to the realtors, 2013 was the year of the office market in Sofia. The available office premises in the top ten projects have been reduced with 7.5 % and the available offices at the end of 2013 were only 10 %. At the end of this year, the realtors expect for another 60 000 sq.m of class A office premises to be completed. In a result of the reduced number of available office premises in Sofia, the rental prices of Sofia offices have increased to 10-12 Euro/sq.m.
Several countries are already members of the travel free Schengen agreement zone, however they have the option to choose whether or not to apply the new measures that are taken under the European Commission Treaty that works within the framework of the European Union. This is valid even for the countries that made a development of the Schengen zone in first place. For example, Denmark is bound with certain measures that it has to follow under the common visa policy.
The United Kingdom and Ireland can take part in all or in some of the Schengen agreements according to the protocol from the Treaty of Amsterdam. This can happen if the member states of Schengen and the government representative of the country vote in favor within the Council. In general, the United Kingdom tries to cooperate in some aspects of Schengen, which include the judicial cooperation and the police cooperation, as well as the application of the SIS system. In year 2000 Ireland also asked to take part in some aspects of Schengen that were covered by the request of the United Kingdom. The request of Ireland was approved in 2002. When Bulgaria becomes part of the Schengen agreement, it’s believed that the country will accept all agreements concerning Schengen as a full member.
The affordable prices of the Sofia offices are attracting many new companies that wish to relocated entirely to Sofia or to outsource some of their business in Sofia city. In year 2013 one third of all available offices from the highest class A have been rented by large international companies according to the reports of the leading real estate agencies. This is so as Bulgaria remains stable and is among the attractive outsourcing destinations with a lot of well-educated professionals and competitive market.
The international companies which are looking for new offices in Sofia are in search of office premises of class A. The business centers in Sofia they wish to rent office premises at have easy to reach location, many facilities services, large parking zones, etc. Almost 60% of all new rental contracts signed in 2013 was with international companies willing to relocate to another office in Sofia. At the same time 15% of the relocations in new offices in Sofia were due to the expansion of the company and 15% for the rental of offices in Sofia by the companies that are entering the market now. The current rental levels of Sofia office premises are around 10-12 Euro/sq.m., where the offices of class A are definitely being rented at 12 Euro/sq.m compared to the 9 Euro/sq.m a few years ago. The real estate companies predict that soon the number of the available office buildings of the highest class A will further decrease.
The future MEPs of Bulgaria had a recent meeting with the president and discussed several important topics that concern both sides. On 9th June, the representatives of Bulgaria at the European Parliament attended a meeting with the president of Bulgaria Mr. Rosen Plevneliev in order to discuss their priorities concerning the European Parliament. The representatives of the European Parliament and the President could find dozen of topics to discuss including the bid of Bulgaria into the Schengen area and the chances of the country to be accepted as part of the travel free Schengen zone.
Iliyana Yotova, who has become a MEP as a member of the Coalition for Bulgaria commented that on the meeting were discussed the foreign policy of the country, the refugees, and the entire situation, etc. When asked about the nomination of a Bulgarian European Commissioner, Ms. Yotova replied with the words of the President, namely that the leading thing in this matter is for the political formations to reach an agreement on the principles and then based on these, the European Commissioner would be nominated in order to avoid a precedent.
The serious international companies that are planning to move their offices in Sofia or to expand their business and rent more spacious office premises in the Sofia are showing interest in the more luxurious office buildings. In general, the office market in Sofia was activated last year and the number of the rented office premises reached the levels from the years before the crisis. In fact, in 2013 the number of office premises that have been rented by new companies and existing companies that are outsourcing their business to Sofia has increased with 30 %. This led to a decreased number of available office premises in Sofia.
According to the real estate agents, the office market in Bulgaria is being driven by international companies, mainly in the IT business. Almost 15 % of all office rental contracts in Sofia that have been signed in 2013 were with new companies that are outsourcing their business to Bulgaria. The prognoses of the realtors are for more such companies to relocate their business to Sofia. The new companies that are looking for office premises in Sofia, as well as the already existing companies operating their business from their Sofia offices are looking towards offices of class A with central location and access to many facilities, which have the necessary capacity to welcome large international companies.
The companies that are outsourcing their business in Sofia are looking for good location with easy public transport links and large parking premises. Currently such office buildings are available in the periphery of the city which make 67 %, while the office projects in downtown Sofia are just 12 % of the total available office space, with 21 % concentrated in the central parts of Sofia. Currently, the office projects in Sofia that are under construction comprise of around 185 000 sq.m.
Recently became clear that the Foreign Minister of Austria Mr. Sebastian Kurz is supporting the progress that Bulgaria has made for being accepted in the Schengen travel free area. Mr. Kurz gave his support for the entry of Bulgaria in the Schengen area during a meeting that he had with his Bulgarian counterpart Mr. Kristian Vigenin, which was held in the Austrian capital Vienna. The two ministers of Austria and Bulgaria further discussed the Southern Stream gas pipeline and agreed that it plays a great role in the energy security of Europe.
During the official meeting, the Foreign Minister of Austria Mr. Sebastian Kurz and the Foreign Minister of Bulgaria Mr. Kristian Vigenin also discussed the situation with the refugees and the immigrants. At that point Mr. Vigenin expressed his opinion that the European Union needs a border policy that is not only focused on the integration and the border security, but is also targeted at the direct support of the countries in the conflict. Both Kurz and Vigenin shared their idea that the European Union has to be enlarged into the countries from the Western Balkans and expressed their opinion how important the good neighborly relations are.
The office market in Sofia has been quiet in the recent years, however since last year there are optimistic signals, according to the real estate agents who have specialized in office sales. The number of office premises in Sofia that have been rented by companies which have outsourced their business in Bulgaria is increasing now. The total office premises that have been rented in 2013 for example, has reached 116 300 sq.m. The realtors state that 60 % of all deals with offices on the market in 2013 have become a fact due to the expansion and relocation of different companies to larger offices.
Which are the companies that are in search of more spacious offices in Sofia? These are new and existing companies on the Bulgarian market that have outsourced their business from abroad. These are mainly international companies from the IT industry, as well as companies dealing with data processing, financial activities, human resources, etc. The interest of the foreign companies in the office buildings of class A in Sofia provoked the start and completion of successful office centers in Sofia, which are equipped and are in the position to offer all facilities that the managers and the employees in these companies require.
The Foreign Minister of Bulgaria, Mr. Kristian Vigenin informed the citizens of Bulgaria that Italy supports the Schengen bid of Bulgaria. Few days ago on a meeting with his Italian counterpart Federica Mogherini, Mr. Vigenin announced that Bulgaria and Italy will work together on the implementation of the project for the gas pipeline of Southern Stream. According to a quote on the Bulgarian National Radio, the Foreign Minister made it clear that Bulgaria has every reason to believe that Bulgaria’s accession into the Schengen area could become a fact in the autumn of 2014.
Mr. Kristian Vigenin further announced that the Foreign Minister of Italy had vowed his country to convince other member states why the approval of the Schengen accession of Bulgaria is important during the Italian Presidency of the Council of the European Union. The Italian Presidency will take place from July until December 2014. The Foreign Minister of Italy had put an emphasis on the fact that Italy believes Bulgaria to be ready to join the Schengen travel free zone and that there is no reason for postponement any more. The two foreign ministers of Bulgaria and Italy had agreed on joining their efforts in the implementation of the gas pipeline Southern Steam and defending it from political attacks.
Leading real estate companies confirm the ongoing interest towards the offices in Sofia from international companies that are already in Bulgaria and are looking to relocate and from companies that are planning to outsource their business to Sofia. The companies that are interested in finding new office premises for their business include mainly companies from the IT sphere and the outsourcing business. These companies are looking for offices in Sofia of the highest class A, with good location along the main boulevards of the Bulgarian capital and the lines of the metro. The rental levels of the offices there are stable, ranging from 10 to 12 Euro/sq.m.
According to the real estate agents, the companies from the outsourcing business follow a policy of reducing their expenses, however they are not willing to make compromise with the location and standard of their offices. That is why these companies insist on large office premises in Sofia, which are equipped with all facilities they require and have the necessary parking and the desired location. Compared to the office markets in Europe, the prices of the offices in Sofia are quite competitive.
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