Investors in Bulgaria shifting to larger property

Sofia Echo.com, 24th April 2006

Preferences and shopping habits of Bulgarian buyers are shifting toward larger facilities, a leading agency found in its report on retail property in Bulgaria in the first quarter of 2006.
This trend is supported by the increasing number of international-style shopping malls currently under development, as well as the number of projects in the pipeline.
In 2006, three major shopping centres will open in Sofia and one in Veliko Turnovo (northern Bulgaria). Large-scale shopping facilities are also planned to be built soon in the Black Sea cities of Varna and Bourgas.
Demand for retail space in high street locations in Sofia continues to exceed supply. Strong demand comes mainly from fashion boutiques, fast food restaurants, pharmacies and financial institutions.

Demand for retail space in shopping centres is very high, which is evidenced by the 100 per cent occupancy of Mall of Sofia. This demand comes primarily from large international brands, such as Benetton, Mango, Sisley, Tom Tailor and others, as well as from large domestic electronics stores and supermarkets.
The demand for retail space in residential areas is higher in locations on major road arteries connecting the neighbourhoods with the rest of Sofia.
Supply of retail premises in Bulgaria is still predominantly formed by high-street retail and warehouse retail.

Rental levels in large shopping centres in Sofia range between 30 and 60 euro a sq m per month, depending mainly on the size and position of the retail unit. Due to the limited supply, rents on attractive high streets command significantly higher levels.
Typically, hypermarkets in the country own their premises, though they have recently started looking for expansion options by renting premises as well.

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