Latest Property and Economy news from Bulgaria. News for Visitors and Investors

10.12.2007 Bulgarian building company Planex eyes Romanian expansion

Bulgarian construction company Planex Holding is investigation the market in neighbouring Romania with a view to cross-border expansion.
Contacts are still at the previous stage but the expansion is just a question of time, Planex manager Plamen Andreev said Dnevnik.
The company executive did not define a time-frame for the operation. The current priority for the company will be to consolidate and broaden its footing on the domestic market.
Objectives for 2008 embrace the completion of several vacation villages and a mixed-use construction with a residential component and a built-up area of 40 000 sq m in Sofia.
The most weighty project, slated for 2008, is the Viva housing compound. It will cost 30 million euro, embracing 2 million euro in land acquisition expenses.
The development comprises four residential constructions, two of which have been completed. The total built-up area will spreads over 70 000 sq m.
Another 7 million leva have been earmarked for the Kavarna City Center mixed-use office and retail location in the coastal city of Kavarna. It will be completed in 2009.

08.12.2007 Russians search for Bulgarian luxury holiday properties

Bulgarian property will keep on attracting foreigners, because prices are lower compared to other EU countries and investors expect that real estate prices will catch up with levels in other EU states at some point.
Valeri Kroushovliev, manager of Veko Estate, said in an interview with Monitor daily that Russians are currently actively seeking holiday estates in Pamporovo .
They are snapping up accommodation for personal use, unlike the British and Irish who have tended to buy into the Bulgarian market for speculative purposes. However, Kroushovliev commented that these types of buyers have been replaced by more sophisticated and discerning investors.
It remains to be seen whether their needs will be met, Kroushovliev added. He also believes that the forthcoming winter season will provide clues about future foreign investment in Pamporovo. Entrepreneurs will see whether maximum occupancy is reached in tourist developments and, if so, whether existing infrastructure is sufficient to meet demand. If ski pistes, ski lifts and gondolas cannot meet tourist needs this may alarm investors.

07.12.2007 Real estate sales in Stara Zagora stage unexpected upsurge

Stara Zagora's strategic location and good infrastructure as well as the growth of business and energy sector, rank the town among Bulgaria's five front-runners in terms of construction growth rates and real estate sale and rent prices. Estate prices in Stara Zagora recorded a boom in November. The prices have almost doubled in comparison to last year's levels.
According to Sergei Kozhin, owner of Evroimoti-Kozhin real estate agency, demand far outstrips supply. As a result of the recent remarkable demand for both old and new construction type units, price differentials between the two kinds of residential estate have almost disappeared. Flats in the most prestigious neighbourhoods sell at 700 euro a sq m. Off-plan offers start from 500-550 euro a sq m. Well-maintained pre-fabs have also recorded an increase in prices - some of them ask as much as 500 euro a sq m. Purchases are financed through loans and cash payments.
Rentals have also exhibited an interesting trend. Company headquarters, based in the vicinity of Maritsa Iztok power plant, have established rigid rules and requirements concerning luxury apartments. Owners who meet all clients' demands, including the provision of luxury furniture, are now able to conclude long-term rental agreements at prices that reach 400-500 euro a month. Retail rentals have also registered an increase. Units situated in the town's centre rent at not less than 1000 euro a sq m and enjoy healthy demand.

06.12.2007 Winslow Developments and RREEF to pioneer new residential project near Sofia

Winslow Developments and Deutsche Bank's investment vehicle, RREEF, are to set up a joint venture, Winslow Properties, in order to co-develop a new construction.
The new plan (their first was Winslow Gardens residential complex in Manastirski Livadi) is to develop a residental complex, valued at 252 million leva, in the Gradoman district of Boyana.
The site of the new complex spreads over 150 000 sq m. The number of residential units in the complex will reach 1200. The pretty area in the spa town of Bankya is close to the future Lyulin Highway. "Our main priorities are comfort, calmness and security - that's what we want to offer to residents of our complexes. The concept of this new project is to create an ecological home close to the big city," Winslow Developments' executive director, Ivan Mekushin, said.

05.12.2007 Luxury property market in Bulgaria is developing

Luxury estates will appreciate in value by 15 to 20 per cent in 2008, but prices of other residential accommodation are likely to stabilize or even lose value, Orlin Vladikov, a member of National Real Property Association and CEO of Orvitex, said in an interview with the private channel bTV on December 2.
According to Rosemary Wellings from the Marbella office of Sotheby's Realty company, the luxury sector is less vulnerable to market fluctuations and a reliable investment in the long run.
Holiday units, situated in coastal and winter resorts, account for more than 90 per cent of luxury estate transactions in Bulgaria, Nikola Stoyanov, managing director of Lux Imoti property agency, reported at a company news conference held last week. He noted that only 5 per cent of luxury establishments in Sofia, actually comply with generally adopted standards for this type of estate.

04.12.2007 Residential real estate market in Sofia undermined by increased supply, told brokers

A serious threat to the residential property market in 2008 is the increasing supply of newly built homes. New findings indicate that they already leave behind demand, according to research by the Yavelna Real Estate Agency.
Only about 20-25% of apartments in the centre of Sofia have been sold successfully, according to the agency. The others have either been sold at a decreased price or after considerable time on the market.
Agencies take an average of about four months to sell an apartment in the centre of Sofia against an average 60 days for apartments swomwhere else, an estate agent told 24 Chassa Daily.
Apartments offered at prices biger than 1500 euro a sq m are the most difficult to sell, besides those with exceptional location, brokers told. These are apartments located in the prestigious Doctors' Garden area, and now Moskovska, Slavyanska and Aksakov central streets, as well as the area around Zaimov Park (Yanko Sakuzov Blvd.)
Currently, 1300 estates are offered on the market, situated in the centre of Sofia. 82 % of them are apartments. Half of them are three-bedroom apartments, according to Yavlena research.

03.12.2007 EBRD lends 6,75 million euro to Bulgaria's construction industry

The lender said in an official press release, that the EBRD (European Bank for Reconstruction and Development) is supporting the fast-growing Bulgarian construction industry with an 6.75 million loan to a brick plant near the town of Lukovit in north-western Bulgaria.
The Bank's finance embrace a 6.75 million euro loan to Wienerberger Bulgaria, a wholly-owned subsidiary of Wienerberger AG, one of the world's largest producers of bricks.
The EBRD finance will be used for the reconstruction and modernisation of the existing Lukovit brick plant, 120 km north-east of Sofia.

01.12.2007 Land consolidation would favour a well-developed agricultural branch

Prices are expected to grow by 20 % over the next year, Vesselin Petrov forecast, but only well-managed and well-maintained consolidated plots will gain value. 76% of the exploited agricultural land in the country is concentrated in large-scale farms of more than 10 000 hectares, which account for only 0.5% of the total number of agricultural farms in Bulgaria, Byuarhan Abazov, deputy minister of Agriculture and Food Ministry, told at a news conference held on November 28.
Bulgaria has about 5.8 million hectares of agricultural plots of land and only 3.8 million of it is cultivated this year, Vesselin Petrov executive director of ELANA Property Management, announced.
A major problem confronting Bulgarian agriculture is that land is fractured - there are about two to three million registered owners of agricultural plots, which translates into small plots and many owners. The largest landowners are municipalities (0.4 million hectares), the government (0.2 million hectares), REITs, investing in agricultural plots of land (they had a total of about 50 000 hectares in 2006, currently own about 100 000 and in 2008 are expected to get hold of 200 000 hectares). They all have to colaborate in order to achieve land consolidation, which in turn, is an expedient to developing a modern and efficient husbandry sector.
The average price of a hectare of agricultural land in Bulgaria is 2800 leva. Plots of land in Dobroudja command the highest prices nationwide (3500-4000 leva) and lands in northwestern Bulgaria sell the cheapest - 1500-2000 leva. One of the causes is that residents in these regions are migrating and selling their properties, which elevates supply and keeps prices down.

30.11.2007 The mall in Veliko Turnovo set for sale in New Year

European Convergence Property Company (ECPC), the investment fund that owns Central Mall in Veliko Turnovo, is usually scrutinising tender offers from potential purchasers the fund's officials said in a statement to the London Stock Exchange.
The company expects to finished the transaction at the turn of 2008.
European Convergence Property Company ' s representatives did not comment on details of the deal. However, according to the advertisment most of the mall's retail areas are already leased.
The owner reported some building defects in the commercial building, which would be removed by the contractor, according to the terms of the consent for the establishment's sale.
European Convergence Property Company officials firstly reported the possibility of a future sale of the establishment in August this year. At that time the company struck a transaction for the sale of its three malls in Romania to the German DEGI Deutsche Gesellschaft fur Immobilienfonds m.b.H (DEGI), a property subsidiary of Allianz Group. The 110.5 million euro transaction was completed in October, delivering 6.4 to 7.2 per cent in yields for the three retail units.
European Convergence Property Company explained their exodus from Bulgaria and Romania and the change of their investment policy through an original "huge unprecedented investment interest toward the region" and a subsequent squeeze of returns on investment in the market.

29.11.2007 Bulgaria's town of Gabrovo to obtain its first mall

Construction of Terra Centre Mall in Bulgaria's central town of Gabrovo has already started, investors Terahim 97 Ltd have reported.
Terra Centre will be the first vast scale shopping centre in Gabrovo Municipality, home to 76 000 people. The five-floor complex, with a 16 000 sq m gross area, will house retail areas, supermarket, entertainment and restaurant areas, offices for the mall's management and lodgers as well as an underground parking space. Investment in the mall is in the range of 15 to 20 million leva. The project's development is financed by the local DZI Bank. The contractor is native firm Glavbolgarstroy. Consultants and leasing agents of the project are NaiProCon. Talks with potential clients have already started and some popular brands have already give expression interest in renting out mall space. Rental levels are in the range of 15 to 25 euro a sq m. The retail centre will be geared towards the average and unexpensivest than average price range.
“We expect 9 per cent profitability from the project in 10 to 11 years,” the project's consultants told. “And this is a very high yield. In Varna and Sofia malls produce a yield of about 7 per cent and the percentage is even expected to go down. For other CEE countries the percentage is 6 per cent, for example.”
Several investment funds have expressed serious interest because of the high profitability of the project, a spokesperson from NaiProCon told.

Real Estate News