The Rents of Premium Offices in Sofia are Growing
Rentals of first class office space in Sofia has grown steadily in the first quarter of 2018 as a result of the active market.
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Rental levels on the office real estate market in Bulgaria are slightly lower than the ones registered at the end of 2008 and range between EUR 10-15 m2/month, shows data of realtor Colliers International.
"There is an increase in the amount of office space on offer due to new space being completed, and space offered for sub-lease by companies that are down-sizing," Anton Slavtchev, Manager Offices and Business Parks at realtor Colliers International, commented.
According to him the "wait and see" approach that many companies adopted, expecting rental rates to fall driven by the global economic downturn, has come to an end.
"During the last few months we have witnessed some movement. Investors have started realizing that it is unprofitable to keep an empty building for six or twelve months, and that it would be more cost-effective to secure tenants, be it at diminished rental payments," Slavtchev said.
According to him the current market is dominated by tenants' willingness to negotiate better parameters and landlords' willingness to give favorable conditions in order to retain clients and attract new ones.
Despite an obvious contraction in the volume of office real estate transactions, the beginning of 2009 witnessed the largest ever office lease transaction in Bulgaria - 23,000 m2 in European Trade Center, which will become BTC's head office.
Colliers expects that the genuine upturn in the office market will take some additional months to work through. In the meantime though, an increasing number of transactions in the form of relocations and renegotiations is likely.
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