Mihail Chobanov: Every One of Us Writes 100 E-mails a Day

Imam Imot Magazine, December 2009

- Mr. Chobanov, at the moment which brings more money to the company – the sales, the consultancy business or the company’s other activities?
- Right now it is very difficult to say where the income comes from because generally speaking in the last year the number of deals is quite low. Every month is different, it is nothing like the previous one. If we look at our statistics for the last few years we can see that there is always a peak in the sales in October. After that in November and December there is a calm which usually remains until the end of January.

The only exception was in December 2006 – before Bulgaria’s accession to the EU. Then the British went mad and we had a record number of deals in the history of our company. But traditionally November and December are always the weakest months in terms of sales. The curve is as follows: in June-July-August-September-October it goes upwards and then goes down in terms of number of deals.

There was a paradox this November when the deals were unusually many. Despite all forecasts for the deepening of the crisis, which once again proves that at present there is no logic on this market and none can be sought.

- What effect did the crisis have on the company?
- We had grown quite a lot. There was a time when all the activities were focused in one company including the teams that did renovation work on the rural properties, the after-sale maintenance and the management. But at one point it became natural to separate those structures, but they remained within the company. Due to the crisis we had to lay off 20% of the staff and at present there are about 150 people working at BULGARIAN PROPERTIES around the country.

Lately we have been constantly restructuring the company and having all these company briefings. We are also constantly launching new activities.

We divided the business as follows: I do the direct monitoring of the overall structure of BULGARIAN PROPERTIES while Polina Stoykova is the executive director on an operational level. Nikola Stoyanov is the person that starts the new activities and after that leaves them to develop. Actually, apart from being the Managing Director of luxury property agency LUXIMOTI he is also the manager of our brand Property Management BG.

- How do you select the people in the company?
- Nikola and I have personally selected every person working for our company. We rely on our personal assessment and also on friends from the very founding of the company.

- What is your forecast for this market segment?
- The irrationality of the market this November does not allow me to make any forecasts. I still do ground work, just like my partner – we have not stopped doing it like some of our colleagues. We are keen on taking care of our business personally and we have a lot of work – I think that each of us writes 100 mails a day and this is not counting the meetings, the briefings and all the other work…

- In principle do such things happen in the company – two people to like each other and become a couple?
- None of our brokers is more than 30 years old. When we started 7-8 years ago most of the people were between 20 and 26 years old and we have had weddings, but the case was that they were already dating when they started working for us and later got married.

- Do you have team buildings?
- We organize them all the time. Our brand Property Management BG manages over 30 hotels and apartment complexes in part of which we are the investors so we have our own bases to use around the country – with conference halls and everything necessary and we try to do this as often as we can. At team buildings we also have in-house awards. We have also celebrated Christmas together for 3-4 days – the whole company, a few hundred people. We are not only colleagues, we are friends.

- Do your people have the confidence of being well-paid?
- You know how brokers work – one month they may have nothing, and the next – a 10,000 leva commission. The principle in this business is that you can make a lot of money only from one deal and then have nothing for a long time. We have an office which had not concluded a deal from January till September and then in October made a 100,000 leva commission.

The situation on the market is very dynamic. We have focused mainly on the foreign market and a large part of our deals come from there. In the peak years we had 7-8 people working in our Borovets office, which at present doesn’t exist. There were times when 17-18 people worked in our office in Bansko and now there are three people.

- Some people working in the segment fear that Russian clients will withdraw from the market as a result of the new regulation real estate deals to be paid only on bank accounts. What do you think?
- From the very founding of our company we have been furtherers of specifying the actual price in the notary deed – something that is not done by everyone in Bulgaria. In fact the specifying of the actual price in the notary deed turns the great wheel of the VAT. I claim that due to that practice of ours millions of leva have probably entered the budget. Because when the investor sells at the actual price they want what is theirs from the builder, the supplier and thus the wheel turns. So from this point of view about 95% of our deals with Russian buyers are concluded at the actual price in the notary act.

When the buyer has some reasons – mainly if the buyer wants to buy the property very much and the seller is a middleman and can’t afford to sell it at the actual price – only then can we make an exception in the interest of the buyer. But the new regulation does not worry us.

However, this change in the law is a serious step which has to be though over very well – an organization must be set up, new employees must be hired at the notary public offices. It must be dealt with carefully so that at this delicate time, when every deal is very valuable both to the developers and the brokers, the process wouldn’t be delayed and thus impede the working process in the branch.

But there is something else – as we work with foreigners we have always received payments on a company bank account. In the beginning once or twice the money was transferred directly to the sellers’ accounts, a couple of the sellers vanished and so to protect our business and name we took all the negative consequences. Today we still pay for past negative consequences.

But the parties on the foreign market work through banks. The money goes via our bank accounts because we are the mediators. With these changes in the law it will be much easier for us. The only thing worrying us is the red tape that could be the result of the new regulations.

Read more on the topic:
BULGARIAN PROPERTIES - the tireless



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