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Bulgaria keeps its position as a leader of the outsourcing market in Eastern Europe. The rental levels of the offices in the capital Sofia are still lowest compared to the rest of the capitals on the Balkans. Sofia and Bulgaria in general remain very attractive office destination, as the office buildings provided to the outsourcing companies are modern and functional, with great locations and many facilities. Bulgaria not only offers attractive rental prices and strategic location, but it also tempts the companies with lower taxes and perfectly qualified work labor, as well as improved procedures for starting a business.

Since the beginning of 2014 until the final months of 2016, the available office space in the Top 10 of the most sought after office buildings in Sofia have gone from 7.5% to 3.5%. The rental levels have gone up a little bit from 12 to 13 Euro per sq.m. In the next few months many new office projects of excellent quality will be completed in Sofia, attracting the attention of the outsourcing companies. All new projects of office buildings that are starting now in the capital of Bulgaria have been previously coordinated and consulted between the investors and the future tenants.

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The real estate agents are facing an improvement on the office market situation in Sofia in the last couple of years. This means increased demand for offices and reduced number of available offices spaces, as well as increased expenses for the tenant companies and less options on the labor force market. At the same time the companies have higher requirements concerning the Sofia offices they want to move in.

The companies do consider the rental price when they are searching for a new office to relocate and that rental price is the main factor that leads them. However, the companies are now also considering the location of the working area and the quality of the building and the facilities and services offered. Most of the companies who are working in Bulgaria or have outsourced their businesses to Sofia and the other big cities in the country plan to develop and in fact grow with 25 % and more, renting bigger and more spacious offices.

Almost 85 % of the outsourcing companies in Bulgaria have increased the number of their personnel, where a great deal of them (almost 65%) register a 25 % increase in the number of their employees in the last five years. This is especially valid for the sectors of the outsourcing, information technologies, professional services, finances, real estate. The same sectors are expected to offer many new jobs in Bulgaria in the years to come. Approximately 15 % of the companies that work in Bulgaria and already have an operating office in Sofia, plan to open a new office outside Sofia, while 13% of them have already opened new offices in other big cities of the country.

Many factors are taken into account and they have different significance depending on the needs and requirements of the different companies. Among the main factors are the expenditures, the professionals available, the facilities in the area, the technical characteristics of the building and the management of the building. The location of the building is also a factor of great importance. The competitive situation on the labor market in Sofia requires a wide range of tools not only to attract but also to retain talented employees, among which being the aggressive remuneration packages, additional health insurance, various teambuilding events, sports activities cards, free catering, etc. The most sought after business regions in Sofia remain the offices along Tsarigradsko Schousse Blvd., Business Park Mladost, Lozenets District offices, Bulgaria Blvd. Offices, and Sofia City Center.

Sofia Office Market today faces increasing demand for offices and lack of suitable available business premises, as well as a slow increase in the rental prices. Besides finding a suitable office in Sofia, the companies are in search of good employees as well. In fact, finding professionals that will want to work in the specific company is among the main challenges that the outsourcing companies face.

According to a market research among the companies renting in some of the largest office buildings in Sofia, the most important factors are the easily accessible location, the presence of large office premises, and the presence of many facilities. The competition among the tenants to attract and retain talented employees and keep in mind their standards in the selection of office space is a clear message to the building companies of Sofia offices that in addition to the financial costs, other factors are also increasing the potential of the building – the quality of the building, the standard of management, the flexibility, the facilities.

Sofia Office Market in 2016 is driven by the large rental deals. The average size of the rented offices exceeds 2000 sq.m compared to the office premises size of 1200 sq.m. in 2015. The negotiations of such large office rental deals in Sofia, however takes more time and efforts. The companies that are looking for such spacious office premises are operating in the IT and the outsourcing sphere. The main problem that they face is the insufficient number of suitable office premises.

According to the real estate agents, the office market in Sofia has approx. 3 % available office premises in the top 10 office buildings in Sofia, which is below the required market minimum. The great demand for offices of the highest class A and the insufficient supply resulted in an increase in the rental prices which now reached 13 Euro/sq.m. Looking to optimize their offices, many companies are now considering other models of working premise optimization such as activity based working and hot desking.