Category: Serviced Offices

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.

The member states of the passport free travel Schengen zone were five initially, when the Schengen area was formed back in year 1985. In the years that followed, the border free area was joined by many member states, namely Italy, Spain, Portugal, Greece, Austria, Denmark, Finland, and Sweden. The largest expansion however happened in 2007, when the no internal border area was accepted the following countries as member states – Czech Republic and Estonia, Lithuania and Latvia, Malta and Hungary, Poland, Slovenia and Slovakia. There are three countries that are waiting to be accepted as members. Cyprus, Romania and Bulgaria are not fully fledged members of the Schengen zone, though they are technically ready to become members.

The member states of the Schengen area took certain measures, which were accepted as part of the cooperation efforts under the Schengen agreement. The main rules within the Schengen border free zone include removal of the checks on persons at the internal borders of the member states, a common package of rules applied to all people who are crossing the external borders of the European Union Member states. The rest of the rules include same entry conditions and visa rules for the short term stay, good police cooperation, strong judicial cooperation, fast extradition system, establishment and usage of the common Schengen Information System.

The real estate agents in Sofia confirm that there are new Sofia office projects and locations emerging on the market. These new projects are driven by the outsourcing and the IT sector. As a rule, the international companies that are outsourcing their business to Sofia city are looking for offices on Bulgaria Blvd. and Tsarigradsko Schousse Blvd. These companies are also interested in the offices in Sofia along the metro lines 1 and 2 – in the areas near Cherni Vrah Blvd. and Todor Alexandrov Blvd. The number of the available offices in Sofia however is going down as the rental contracts for Sofia office premises are expected to reach the levels from last year or 90 000 – 100 000 sq.m.

The prognoses of the real estate agents are that the large companies will focus towards high-quality office buildings in zones that have not been that attractive until now. Such areas include Sofia business centers near the airport, the upper zone of Tsarigradsko Schousse Blvd., the zone near Business Park Sofia and the southern part of the ring road. An important factor here is the approaching new lines of the city metro, which will make these locations easily approachable. Some companies from the IT sector and the outsourcing sector are already showing interest in the offices in that part of Sofia. The large office projects in Sofia city include Sofia Airport Center, Alfa Business Centre near the ring road, Bulgaria Tower office center, Megapark on Tsarigradsko Schousse Blvd.

The steady growth of the outsourcing sector in Sofia city led to serious situation on front of the office market investors. The companies from the outsourcing sphere are showing serious interest towards the highest class office buildings, namely business centers AA with all the facilities and extras they come with. The international companies that have picked Sofia as the destination to outsource their business have special requirements towards the office premises they intend to rent. It seems that Sofia city has many available offices, however only four or five of the business centers answer to the high requirements of the office buildings of class AA. Currently, there are two or three projects for office buildings of the same quality and high standard. The main set of offices for rent in Sofia that are available are with size ranging from 250 sq.m to 1000 sq.m, while the large companies from the outsourcing business looking to relocate their business practices in Sofia are looking for office premises with size of 1200 sq.m and larger.

The companies that are outsourcing their business to Sofia city are looking for large office premises in Sofia office centers of class AA, or two or more offices set on one floor. Many of these companies are also planning to expand the number of their employees in the future, thus most probably they will need even larger offices in Sofia to rent. Among the other requirements are the good location and the easy access to the local public transport system, large parking area, good air conditioning and ventilation system, wireless internet, etc.

Sofia city has new types of companies that rent the available office premises in the modern business buildings. More than half of the office buildings in Sofia are rented by outsourcing companies, which choose only high class AA office buildings. The outsourcing industry in Sofia grows significantly with the impressive 20-25 % per year and the companies in that sphere of the business seem to be the ones that are most active on the Sofia office market. The business of the outsourcing industry is associated with investments in call centers and service centers and these companies often need significant space to do their business.

That is why in year 2013, more than half of the office rental contracts were signed with companies working in the outsourcing sphere. This is good news for the real estate agents, however the outsourcing companies looking for offices to rent could be quite precise and demanding clients. Unfortunately, Sofia city has not so many office buildings of such a high class. It seems that the office market has to go in one direction – projects and construction of office buildings of the highest class AA. These business centers with offices have to enjoy central location or location in the organized business areas of Sofia. They should also have good transport connections and large parking areas.

Many investors are now showing interest in the Sofia office premises of highest quality. It is a fact that in 2013 and in the first three months of 2014, the Sofia offices of class A reached very stable rental levels. The real estate agents believe that this tendency will go on and they are positive that the choice of good quality offices will remain very good. The offices in Sofia that provoke the interest have several main characteristics – they have great location and a wonderful choice of amenities. The good location is a self-explanatory factor, as it means that the employees and the partners and clients of the company will have fast and easy access to the office by walking or by using the public transport. The choice of amenities include all those little things that every employee needs – excellent internet connection, wonderful maintenance, parking area and a great choice of dining places nearby.

The managers of the big companies that plan to relocate to Sofia and are looking for a modern office premise insist on the professional property management and maintenance. The good office management companies have the necessary knowledge and know-how to maintain such large office buildings in Sofia and they have experience.

The real estate agents confirm that the situation on the Sofia office market is stable and expect the rental levels of the prime office space in Bulgaria to increase in 2014. There is a serious interest in the office buildings in Sofia city in the recent months and this tendency is expected to increase the rental prices. The experts say that the good offices in the best business centers in Sofia will soon be rented for more than 10 Euros per square meter and these prices will remain stable. Currently, the rental levels of Sofia offices are around 7 – 9 Euros / sq.m and the interest towards the offices is very serious. There are many international companies that want to outsource their business to Sofia and many local companies that are in search of larger offices as they expand their business.

According to a research, the number of the completed office premises in Europe, the Middle East and Africa has increased significantly in 2013. This is due to the increased construction of office buildings at these markets. The experts predict that this tendency will continue and the office premises in places like Sofia and other capitals on the European capital will go up with 17 %. A great deal of the new office premises in Sofia and in the rest of the countries have already been rented, even before being completed.

Many local companies and a great deal of new international companies are looking for a new office in Sofia. Besides the location and the good maintenance, which the companies rank as most important when choosing an office, the managers are also interested in several other things. Many of the companies are looking for spacious open-plan offices with a height of the premises of 2.80 m, windows that could be open, cabling for internet and satellite television CAT 6, UPS, as well as energy efficiency façade, etc. All these elements of the Sofia offices are not taken individually, but as an entire package. When looking to relocate to a new office in Sofia, the companies are mainly in search of vast open premises with no partition walls. The company can use the office area in this way or can later add patrician walls. There are also companies that insist on Sofia offices with separate cabinets such as pharmacy companies, banks, lawyer offices. When the office is of the open space, the companies insist on 8 to 10 m distance between the columns.

Another thing that the companies in Sofia are looking for in their offices is presence of a parking area. Companies find that quite important both for the convenience of their employees and for their business partners. The companies are looking for location near the big boulevards and in the Business Park Sofia, which are well connected to the center of the capital. In general, today the companies know what they are looking for when searching for a new office in Sofia. They have certain requirements and are looking for a number of important characteristics in the new Sofia office they plan to relocate their business at. Among all the enumerated characteristics, we should also mention the rental price or the sales price of the offices, which is also a factor for the business companies.

There are many new office buildings in Sofia and a lot of local and international companies that are looking to relocate to a better and more comfortable office premise in the Bulgarian capital. There are several important things that all general managers look for when they are in need of a new office in Sofia city – the location and the maintenance. In the last two years, the companies looking to buy or rent an office in Sofia city are requiring office buildings with full service. The market situation shows that the office projects with good location and not so perfect parameters and the buildings with perfect technical parameters but unattractive location or low overall quality of services hardly ever attract the interest of the companies.

If a certain office building wants to attract and retain its company tenants, the developers and owners of office buildings should pay attention to the overall attractiveness of the location, the available property management and the offered maintenance, as well as the availability of dining places and public transport. Most of the big companies that are relocating to Sofia city are interested in the areas along the main boulevards. Other companies are looking for offices in the business centers of Sofia and yet others are interested in the downtown Sofia location. The location is associated with the access to the public transport including the metro. The other important criteria here include the time in which the maintenance company reacts when something is not working and then comes the rental fee. The least important factor for the companies searching for a Sofia office is the maintenance fee.

The potential of the Sofia office market is enormous according to real estate agents from leading brokerage companies. Many of the companies which are now outsourcing their business in Sofia and the companies which are already part of the business sector in Bulgaria are looking for fully furnished and well equipped offices in Sofia. The construction companies which are investing in office premises are now trying to provide modern office buildings with Sofia office premises around 200 and 250 sq.m. According to the real estate agents, there are not many available offices of the highest class A in the center of Sofia and there is a niche for them to be constructed. Such offices however are also on demand in the outskirts of the city, especially near the ring road.

The investors in office buildings in Sofia should know however that there is a tendency for the companies to sign rental contracts for shorter period of time. In the past the companies were signing rental contracts for their Sofia offices for ten years, now they are more willing to sign contracts for half of that period. Why is that so? The companies want to feel free to change the location and the office building in Sofia, in case they find out that the current office premises they are renting in Sofia do not answer their needs anymore. There is yet another trend on Sofia office market – the so called co-working process, where individuals rent a single working space where they can work together with people from other branches.