Category: Offices for rent

More than one fifth of the office premises that are under construction in Sofia are already rented, mainly by companies in the outsourcing industry. The international companies that want to make business in Bulgaria are focused on Sofia, but some are also looking towards the cities of Plovdiv, Bourgas, Varna and Rousse. The drop in the vacancy of office premises is another indicator of the office market in Sofia and the increased demand for quality office space in the capital of Bulgaria. The rental levels of the high-quality offices of class A are between 12 and 14 Euro/sq.m, however the number of discounts and special offers has dropped.

During the recent years Bulgaria has received several awards, among which Destination of the Year by the European Outsourcing Association and the UK Outsourcing Association. Another great recognition comes from the fact that Sofia city was chosen to host the annual conference Leadership Summit & Awards 2016, during which it became clear that the quality projects of class A that answer the needs and the requirements of the international companies will strongly differentiate from the other offices on the market.

The supply of high-quality office premises in Sofia has increased with more than 5 % in the last six months, reaching approximately 1 900 000 sq.m. This became possible as the new offices of 79 500 sq.m. of Capital Ford business center were added to the number of the available offices in the capital Sofia. The offices of class A that are on demand are usually rented by international companies working in the sphere of services, real estate, IT, outsourcing and pharmaceutical sphere.

The prognosis on the office market sector are for stable and serious demand for offices of the highest quality in Sofia for the year ahead. The rental levels of the office premises vary between 12 and 14 Euro/sq.m depending on the location and the available facilities. The interest towards Sofia and Bulgaria in general on the part of the companies and investors is quite serious. In the next two years, the offices in Bulgaria that are planned to be constructed are as follows – 80 000 sq.m in 2016 and 240 000 sq.m in 2017.

The Long Tower Office Building that is to be constructed in Sofia city is named so due to its impressive height of 56 meters. It will include office premises of various size and layout, welcoming waiting areas, underground parking zone and panoramic terrace. The new office center will be situated on Bulgaria Blvd, parallel to Todor Kablieshkov Blvd. above the roof of the already operating trade center Bulgaria Mall. The seven storey building will cover 18 550 sq.m of area and will feature many premises of different usage.

The main entrance of the Long Tower office center will be placed from the side of Todor Kableshkov Blvd. There will be a second entrance to the south towards Bulgaria Blvd. The ground area will provide the connection between the underground floors with the parking lots and the above ground floors with the offices. There will be located the main entrance and the welcoming zone. Close to the reception zone will be located the security guard’s premises. The connection to the shopping center will be possible from all levels of the office building.

Garitage Park in Sofia is a multifunctional gated project situated in the area above the Ring Road and after Sofia Park Villas. The project of the office building has been considered in a wise way including various premises that the professionals and the residents might need including modern offices of different size, commercial premises, school, sports zones and entertainment areas with two entrances – from the Ring Road and from the bridge at Arena Cinema.

Garitage Park will cover an area of 165 sq.m, which is almost double the size of Business Park Sofia. The project will offer 95 000 sq.m. of offices, 60 000 sq.m of apartments, 4500 parking lots, a sports center with a swimming pool, etc. The investment made will be around 150 million Euro. The project will be built in several phases. The first one will be focused on two office buildings of 18 000 sq.m, 120 apartments and the underground parking area for the first three office and residential buildings. The second phase will be focused on the infrastructure. The third phase will be focused on the taller office and residential buildings.

In 2015 was launched the construction of a new office project called – Kambanite, which is expected to be ready by July this year. The company that owns the plot of 10.7 thousand sq. m and invests in the construction plans to offer a multifunctional building of the highest class, that covers the criteria for green buildings and urban constructions. The same company has already invested in the construction of the new office building where the HP headquarters in Bulgaria is based. That is why the company sees the new project for an office building in Sofia as part of the expansion in that region of the capital.

The company has already declared that it has many other plots of land close to the ring road and has plans to build on them. Yet, there are still no projects in mind but even so most probably they will be focused on the construction of business centers for the software and outsourcing companies. The total unfolded built-up area of the office center “Kambanite” will be 13.5 thousand sq.m, where the office premises that will be rented are 10.1 thousand sq.m. In addition, the project will have a restaurant and 215 parking lots. There is a serious interest in the project and many existing and new tenants coming from the IT and outsourcing sphere. Mladost region is also appealing as a residential zone, suitable for the families with children and the young professionals working in one of the office centers in that part of Sofia.

The Ring road of Sofia has become quite appealing to the companies based in Sofia or planning to outsource their business in the city ever since the construction and the successful launch of Business Park Sofia. This modern business venue completely changed the atmosphere and the overall appearance of the region and marked the start of new type of projects in the real estate sphere in Sofia city. This new business zone of the capital is a natural consequence of the growth of each city and is a focal point for certain businesses.

Business Park Sofia is functioning ever since 2001, and once it was constructed the region was built in with several large retail and shopping projects like Sofia Ring Mall, Arena Cinema Center, Tehnopolis, IKEA, Decathlon, Residential Park Sofia, etc. The new office projects in Sofia that are planned to be constructed in the area include the multi-functional complex Garitage Park, and the nearby Kambanine Building. The business zone of the capital is now providing offices, commercial centers, hotel, zones for recreation and many dining places. The business park with its offices and the area around are highly appealing to the outsourcing and the IT business.

Sofia offices market saw an active search in the last three months, a tendency that was going on in the first five months of 2016 as well. The main factor for this market situation is the increased interest and need towards expansion of the offices that have been previously rented. This interest mainly comes from the BPO centers and the IT companies and it resulted in the creation of many new office projects. In 2015 only in Sofia city were completed more than 105 000 sq.m of offices. Great deal of them were rented before the office centers were even completed. That is why the current supply of office premises on the market is still insufficient.

The Sofia office market is being driven by the interest of the new tenants and the expansion of the companies that are already on the market. The average size of the rented offices in 2015 was 1200 sq.m. – a fact that confirms the need of the companies for more spacious offices. The offices that are planned to be completed in 2016 are only 70 000 sq.m., in smaller office buildings great part of which for the investor companies own usage. This means that the lack of high-quality office buildings will not be dealt with in 2016 as well and the tendency for renting offices that are still under construction will remain valid. The completion of the larger office projects is planned for the first half of 2017.

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.

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.

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.