Market Research 

In H1 2019, building permits for TBA of 788,000 sq. m. were issued, while the construction starts were 454,000 sq. m.

In Q2 2019, the average price for sq. m. in Sofia was €1,054 per sq. m. for newly built dwellings and €1,086 for existing dwellings compared to €955 and €1,077 respectively, as of Q4 2018.

Housing affordability index increased from 167 in Q4 2018 to 177 in Q2 2019

The area around Paradise Center is the most preferred by the office occupiers in Sofia

In 2019 MBL conducted a survey among 100 companies which are tenants of class A and class B office space in Sofia. Our team interviewed employers with approximate headcount of 22,000 and total footprint of 274,000 sq.m. office space, 63 % of which represents class A space. With 76 % international companies are predominant for this survey and the main part is taken by the representatives from the IT and BPO sector.

In Q3 2019, the stock of retail space in existing shopping centers in Bulgaria is 845,200 sq. m., of which 424,500 sq. m. in Sofia. Тhe overall vacancy fell to 9.7% from 10.5%. Food chains such as Billa, Lidl and Fantastico keep their strong intentions to further expand their chains mostly in Sofia. 

The stock of modern office space is 2.1 million sq. m. The space under construction decreased to 413,000 sq. m. The vacancy rate went up to 9.5%. The net absorption in Q3 was 29,700 sq. m. The take up was 25,900 sq. m. The average asking rental levels are predominantly in the range of €12 - €14 per sq. m for Class A with only a few exceptions, while rents for Class B vary between €8 and €11 per sq. m.

In H1 2019,  122,000 sq. m of industrial space was delivered in Sofia. As a result, the total inventory reached 3.0 million sq. m., of which tenant-occupied space – 975,000 sq. m. The vacancy rate remained stable at 3%. Due to the increasing demand for modern warehouses, space under construction increased to 252,000 sq. m. Prime rents in Sofia range between €5.00 – €6.00 per sq. m in the city and €3.50 – 4.50 per sq. m. in the outskirts.    

MBL conducted the first of its kind survey among owners and investors of 52 office buildings in Sofia, representing nearly 40% of the market (774,000 sq.m) The analysis gives a direct view of future and current projects and the investors' expectations of rental levels movements and market trends in 2019 and 2020.

Market highlights:

• The stock of retail spaces is at all-time high - 852,900 sq.m.
• The vacancy rate in Q2 2019, fell sharply to 10.5% due to the areas leased in the quarter, which were previously occupied by Carrefour.
• Provision rate of retail space:
  • Varna – 347 sq.m.
  • Sofia – 299 sq.m.
  • Stara Zagora – 275 sq.m.

Market highlights

• The stock of modern office space is 2.06 million sq. m. The space under construction increased to 453,000 sq. m;
• The vacancy rate went down to 9.1%;
• The net absorption in Q1 was 27,000 sq. m. The take up was 20,500 sq. m;
• The average asking rental levels are predominantly in the range of €12 - €14 per sq. m for Class A with only a few exceptions, while rents for Class B vary between €8 and €11 per sq. m.