Category: Offices for rent

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.

The new phase in the construction sphere is a fact since 2015. Local and international entrepreneurs have already started new projects in sectors with serious demand including the offices, the industrial real estate projects and the residential buildings. As positive signs on the market is the return of large-scale multifunctional projects and this trend is expected to continue in 2016.

Many consultancy companies and real estate agents believe that Bulgaria has established itself as a great outsourcing destination, which implies a growing demand for new business centers and increase in the number of start projects. There are also indications of interest shown in investments that concern the completion of office buildings and shopping centers. That is why there are expectations for signing of significant yet realistic transactions this year.

In the last two years the demand for office space in Sofia was driven mainly by the IT and outsourcing (BPO) sectors. Thanks to that demand, many new office projects entered the planning phase and their construction was started where most of them will come to market in 2017. Among these projects are Kambanite Green Offices, Blu Offices, Trade Center Europe (building 1), City Tower, “Millennium Centre”, Garitage Park, Sofia Airport Center (Phase 2), Expo 2000 (phase 4), Sofia One (phase 2).

The Bulgarian capital Sofia is experiencing a serious demand for office premises. In the period 2016 – 2017 will be completed several very tall office buildings. In 2015 was officially opened the tallest office building in the country – Capital Fort. With its 126 meters, the office giant went ahead Hotel Rodina with its 104 meters. Read the text below which will be the five tallest office buildings to be released in Sofia city in the next several months.

1. Capital Fort (126 m) located on Tsrigradsko Schousse Blvd., where are placed the offices of the companies Scale Focus and Apcom, Skrill and Visteon.

2. Itower (107 m) is positioned in the central part of the city near Macedonia Square. The investors come from Italy, Cyprus and Portugal. There are several projects for the architecture of the office skyscraper, however there is no official information about it yet.

3. Infinity Tower (90.5 m) – the office building is located on Bulgaria Blvd. and is adjacent to Bulgaria Mall. It is among the best office projects in 2014, featuring a glass façade and comfortable office premises of different size.

4. Millennium Center (85 m), perfectly located behind the National Palace of Culture, this business center is in the last stage of its completion. Two local banks will occupy more than 7400 sq.m of offices there – CIBank and DZI. The building is expected to be completed and officially open in June 2017.

5. City Tower (74 m) – this is the office center near Stamboliiski Blvd., that is to offer 39 000 sq.m of office premises. The business center is expected to be completed in 2017 and the investor is the Bulgarian representative of a Greek company.

The prognosis of the real estate brokers working in the sphere of office premises in Sofia are for a serious interest towards the already finished and operating office and retail properties. The priorities of the investors on Sofia office market are expected to shift their priorities and get offices that can start generating revenue immediately. The main demand is expected towards offices with central location in Sofia that come with long-term lease contracts. Due to the insufficient supply of office premises in Sofia, it is believed and expected for the office rental and purchase prices to rise. However, that will happen with a slow pace.

Year 2016 started with an enhanced search of Sofia office premises that are still in construction as well. The expectations are for the office rental levels to go up as the completed new offices for the entire year will be only 70 000 sq.m. Since more than 130 000 sq.m of office premises have been rented in the last two years in Sofia, the market is expected to face insufficient supply of quality properties suitable for the industry and business needs. The most significant new projects that will be released on the office market in Sofia in 2016 are only three – Blu Offices on “Brussels” Blvd., SPS Tower “Bulgaria” Blvd., and “Kambanite Green Offices” near the Ring route. The serious search of business areas will remain stable in 2016 and will be driven mainly by the expansion of the IT and the outsourcing sector.

In recent years, Bulgaria has become more recognizable outsourcing destination, however the insufficient number of offices in Sofia that are meeting the company’s requirements has driven many of them to other major regional cities of the country.

Great deal of the companies that are looking for office premises in Sofia are coming from the IT, outsourcing and financial sphere. These companies are in search of large offices above 1000 sq.m, situated in the big business centers of Sofia. The real estate experts comment however, that there is a serious demand now for smaller office premises with size between 200 and 400 sq.m. Such offices can be found in many areas of Sofia and are usually searched for by startup companies.

The tendency concerning the office premises in Sofia for the beginning of 2016 is for the large companies to relocate to larger office premises of more than 1000 – 1500 sq.m., thus disposing many smaller offices mainly positioned in Sofia city center. The rental levels of the offices in Sofia during the first quarter of 2016 remain unchanged – varying between 10-12 Euros / sq.m for the offices of class A and 12-14 Euros / sq.m for the very luxurious offices in the new office buildings. It is believed that the office market will remain active in the next 12 – 18 months.

A new tendency in the office market is now to be traced in Sofia city. Along with the serious interest towards the offices larger than 1000 sq.m of usable space, many startup companies from all over Europe are now looking for smaller office premises in Sofia between 200 and 400 sq.m of area. The local companies that are further developing their services and production are also looking for new offices. Most of the companies on demand of office premises are coming from the financial and the IT sphere. There are also companies trading on the stock markets or working in the sphere of the high technologies and services.

Since the beginning of 2015 there is a greater supply of office premises thanks to the office projects that have been restarted in 2014. The new office projects in Sofia are offering larger office premises above 1000 and 1500 sq.m. The subsidiary companies that are looking to relocate under one roof have interest in these large office premises and they are to release the smaller offices they used to rent. It is expected that those smaller office will answer the needs of the startup companies. The rental levels remain in the levels of 10-12 Euro/sq.m. per month in the Sofia office premises of class A. However, in the most luxurious offices the rental prices go up to 13-14 Euro/sq.m. per month.

The outsourcing services and the IT sector have the capacity and the will to open another 45 000 work positions by 2020. Bulgaria and especially its capital Sofia, is a leading outsourcing destination in Europe and the IT companies are in search of talented specialists in the country. The interest shown towards Bulgaria is not new, since Bulgaria won the European Outsourcing Awards contest for 2015. The country has been nominated as one of the three best places for outsourcing of services and production in the world, along with South Africa and Latvia. Bulgaria has been chosen as the best outsourcing destination thanks to the professionals working here and their skills, knowledge of foreign languages and low expense rates. The country is part of the European Union, which is another plus as well.

The annual turnover of the outsourcing industry is 1 billion Euro and the expectations are for this figure to double by 2020. In the last decade the income of the IT companies has shown an increase of 600 %. At the end of 2014 more than 33 000 specialists have been working in 180 outsourcing companies in Bulgaria. The solid salary and the flexible working hours are drawing the attention of a growing number of graduates.

Since the middle of December 2015 Sofia has its brand new Technology and Innovation Network Center, planned to become the core for innovation and startup businesses in the country. The innovation center is an initiative of the state and is located in the ex-military center near the 4th kilometer in Sofia. It features a complex of several buildings, a park and a sports center. The new Technology and Innovation Network Center still needs a pedestrian access from “Tsarigradsko Schousse” Blvd. Approximately 35 000 sq.m will be added to the technology project by the end of 2016.

The purpose of the complex is not just to offer more offices and business buildings, but to be a hub for the technology companies, combining technologies, universities and education centers, science innovations. The aim of the Technology and Innovation Network Center is to gather in one place all those companies that are oriented towards the innovations, information and communication technologies, new and green energies, etc. The new Technology and Innovation Network Center plans to attract international scientists and investors.

The investor company FairPlay International has plans for the construction of a 10-storey office building in the center of Sofia. The company has already invested in the plot of the former Czech Republic Embassy, which spreads over 3.5 decares. The plot has a wonderful and easily approachable location on Yanko Sakazov Str., being meters away from Vasil Levski Monument and “Quadrant 500”, just opposite the former Serdika Cinema.

The plan of the investor is to construct a modern office building on the site of the old embassy, which is to be demolished. In the last couple of hours have been going on various administrative procedures for changing the status of the plot. Once the documents are arranged, the company can start the construction of the new office building. The project is for ten stories of offices with access to the boulevard. The area is very favorable, close to a large park and many places for dining out and yet featuring not many office premises. The region enjoys excellent transport connections, which will further turn the office building into a tempting business location. Interest towards the new office project in Sofia is already shown by companies in the insurance and in the financial sectors, which value the central location and the proximity to important state institutions.

The fourth phase of the Expo 2000 office complex has started and it is expected to bring another brand new 12 500 sq.m of offices of class A by September 2017. The SEO of Expo 2000 Office Park Adina Welsh, explained the that third phase of the Sofia office complex has been completed one month prior to the due date thanks to the great cooperation with the company Strabag. That third phase has got a Leeds Gold Certificate since August 2015, resulting in excellent optimization of the monthly expenses concerning water and electricity, etc.

That innovative green initiative will go on in the next phase of Expo 2000 Office Park in Sofia, aiming to improve the office environment. All the requirements for the offices of class A will also been taken into account. The managers of this office park in Sofia are expecting serious interest from many outsourcing companies that are already operating in Bulgaria or plan to outsource their business to Sofia. Phase 4 of the Expo 2000 Office Park in Sofia will offer 12 500 sq.m of high-quality office premises by the fall of 2017 and will come with a large underground parking area, many green areas and places for recreation.