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Bulgaria office properties tipped as hottest market niche ‘07
No major spike in property prices is expected after Bulgaria joins the EU on January 1, 2007, said members of the managing board of Bulgaria’s National Real Estate Association.
The price growth for 2007 is seen at 20%, slowing to 15% the year after.
The nation’s EU admission is expected to boost mainly the value of office properties.
On the residential segment, only upscale properties in prime locations will retain pricing momentum.
Business centers will be the top growth segment over the next 18 months with return rates at around 9% as multinationals seek to position themselves here in the aftermath of the EU entry while local corporations move out of non-purpose-built to purpose-built office premises. Office rent levels added 5-8% in the first half of 2006.
The supply of Class A office buildings stood at 165,000 sq m by July 2006, up 28% over end-2005. Total supply across the country is estimated at 513,000 sq m.
The average rate of office building vacancies has dropped from 13% ate end-2005 to 8%.
The key office properties in development in the capital are Business Park Sofia, Alfa Center and Europark.
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