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. This shows the data
the consulting firm Forton, which is an exclusive representative of the "Cushman & Wakefield" for Bulgaria and Macedonia.
The average offer levels in the segment are already EUR 14 / sq. m / month compared to 13.5 EUR / sq. m /in 2017, as a whole in the high class
offices vary between EUR 12 / sq. m / and EUR 14 / sq. m / depending on the location of the building. The highest prices are in the central projects
areas and along the big boulevards.
Rental rates for lower-class offices (B) range between EUR 9 / sq. m / 0and EUR 11 / sq. m. /
"Landlords remain in a comfortable position as a result of the still limited supply of premium office space and this led to a new smooth rental growth. The expected completion of over 190,000 square meters of new offices this year will, however balance the market and we do not expect rents to continue to rise, "commented Stanimira Pashova, Manager Office Spaces in Forton.
According to the company's data in the first quarter of 2018, rental contracts for 36 296 square meters were signed. This is 4%
growth over the same quarter of the previous year.
The continued rise in market volume is the result of the momentum in 2017 when rental deals reached a record nearly 200,000 square meters.
The main engine remains the IT and outsourcing expand or search for better locations. Among the more significant deals in the first three months of the year is the rental of 6300 square meters in the the newly built building in "Central Park Office" by the company "60K" in the wide center of Sofia. The Kaufland Services contract for 2082 square meters in the building of the construction company Filto-C on Todor Alexandrov Blvd is another big deal since the beginning of the year.
Currently more than half of the office space planned to be completed this year are already occupied, reported by Forton.
In the first quarter there were no new finished buildings and the total office space supply was 1 728 233 sq. M. The average vacancy rate on the market decreased to 9.2% as a result of high rental activity in the absence of newly finished buildings. Forton's forecast is that rising supply will lead to a gradual increase in free space over the coming years.
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