Profit.bg talked to Atanas Garov, managing director of Colliers International, about the condition of the real estate market in Bulgaria, its short-term development prospects and whether the supply has shifted towards another group of clients, different from the ones from the western countries: Mr. Garov has the slowdown of the economy in Western Europe affected the real estate market in Bulgaria? The slowdown affected the domestic real estate market a long time ago but not all its segments. There was a price correction in some of the segments before the slowdown in Europe. For example the holiday properties market. A lot of segments of the market, such as the letting of commercial centers, the office space markets and logistics properties are developing well provided the present market conditions. One could say that the market niches where the deals are sealed between an entrepreneur and the end client have not been disrupted by the crisis (with the exception of holiday properties). The only market niche that was affected directly by the global trend is the investment market. There is a slowdown in the number of deals and a price correction at present. After all, this is a market that depends directly on the external factors for the country. On the other hand market segments, such as commercial space, offices and logistics and to a certain extent residential properties, which rely on domestic demand, have only been slightly affected by the recession. Have foreigners started selling properties in Bulgaria already? Colliers does not specialize in the sales of holiday properties (where foreigners own most properties) and unfortunately we cannot comment on this issue. What are the optimistic, realistic and pessimistic prospects before the real estate market provided the recession concerns in the leading euro area countries? Optimistic: The interest rates in the euro area drop to their levels prior to the crisis in the next quarter. The volume of deals sealed on the investment market rise considerably, which prompts more sales to end clients. Pessimistic: Interest rates retain their current levels in the long term. Similarly to the dotcom boom the interest and the clients shift to other sectors, such as alternative energy production and agriculture. Are there companies in the sector that have shifted to another group of buyers, different from the ones from Western Europe? This issue may be discussed from the standpoint of holiday properties and investment properties. There is a shift on both segments, however. Russian buyers are showing interest in holiday properties. No clear shift may be outlined on the investment properties market yet due to the decline in the volumes but Middle Easter companies have been showing interested in Bulgaria and Southeast Europe recently.Source: http://profit.bg/index.php?cid=4&sid=0&aid=4470&sec_name=LATEST
Tuesday, September 16, 2008
Sunday, June 8, 2008
70 Million EUR Investment in Biggest Office Center in Bulgaria
70 million EUR will be the cost of the biggest office center in Bulgaria - the European Trade Center.The construction works are presently planned to be finished in January 2010.The large project has mobilized big part of the sector's capacity.By the project's data round 60% of the constructing and engineering resource of Sofia is occupied with the center's realizing.14 cranes are presently working on the building site.The European Trade Center is located on the busiest boulevard in Sofia - ‘Tsarigradsko Shose' and includes the highest office building in construction process in Bulgaria for the moment.The new center will be build using a serial of ‘green technologies', lowering the energy expends and optimizing the functional environment in the center. The roofs will be planted.The center is being built in a common comnplex with ‘Carefour Tsarigradsko Mall' and will offer individual projecting of office surfaces.
Tuesday, May 20, 2008
Return on investment of Bulgarian properties
New report of the Bulgarian think-tank Industry Watch analyzes the residential property market in Bulgaria for the first quarter of 2008. According to the information there the return on investments (ROI) in Bulgaria’s property is more dependent on sale price than on rental yield.
For the Q1 2008 the rental levels for two bedroom apartments increased by 4%. For the same period the purchase prices of residential properties are recording a faster growth. Thus the property investment pays out in 188 months taking the sale price into account while for rental yields it pays out for 234 months.
The Industry Watch report includes a forecast with annual growth in property prices in Bulgaria of 13-14% in the next five years. According to the report the foreign investments in real estate will decrease slightly.
