Realtors: Bulgaria housing price growth to slow in ‘08

Bulgarian housing prices will continue on the upside in 2008 but at a slower pace than 2007 when gains topped 30%, said Strahil Ivanov, manager of leading real estate agency Yavlena. Residential properties are expected to appreciate by 12% to 15% in 2008 as demand continues to outstrip supply. The robust uptick recorded in 2007 was a surprise to the experts who had forecast a price increase of around 15% for the full year, said Ivanov. The forecast of Krasimir Dimitrov from Source Residential Properties is for a growth of 8% to 15% in 2008. The Address projection is also for a 15% price gain. Yavlena said developers are expected to turn their attention over the mid-term to the center of Sofia which is crowded by old residential buildings in bad repair

Colliers: supply of holiday homes in Bulgaria significantly up

The resort apartments market in Bulgaria continues to grow with increasing pace, show the latest research findings of real estate consulting company Colliers International. As a result the total number of holiday homes units as of June 2007 is in excess of 76,500. In the mountain resorts supply increased by 52% during the first half of the year, after almost 10,000 new apartment units were put on the market. The growth was most significant in the Bansko area (including Razlog), which accounts for 78% of the new supply. Supply in coastal resorts also increased substantially and recorded a 39% growth, or 13,500 apartment units, in the first half of 2007, said Colliers. Although Sunny Beach continues to account for more than one third of the supply in this segment, other resorts saw accelerated development as well. In St. Vlas and in Sozopol holiday homes supply increased by 52% and 62% respectively. Overall sales prices in the resort apartments segment remained unchanged for the past half year as supply continues to outpace demand. Price ranges remained within last year s limits between 800 and 1,700 euro/sq m, shows the Colliers Holiday Homes Market Overview

Developers to invest in 3 new Sofia business parks in Sofia

Three new clusters of multi-tenant office properties will take shape in Sofia, said Dian Diakov, office space manager at real estate consultancy Regent Property Advisors. Business Park Sofia (BPS), in the capital citys Mladost neighborhood, will soon be joined by similar developments sited on the Nikola Vaptsarov boulevard, in the vicinity of the Sofia International Airport and in the Lyulin district. According to Diakov, there is an undersupply of office properties for sale. The shortage has driven rent rates to 30 euro/sq m per month, a target that seemed unattainable just six months ago. Diakov said the cheapest office rentals at the moment are listed at 10 euro/sq m. Some 900,000 sq m of new office space inventory should be placed on the market in Sofia by mid-2009, adding to the 350,000 sq m already in active use. Developers are betting on Class A office properties as droves of local companies are looking to upgrade from the modified apartments they currently occupy to purpose-built office space. Varna, where a business park development similar to the BPS is taking shape, is at the forefront of this trend. The office space stock in Burgas has reached 120,000 sq m while the town of Pleven will soon boast Mania Tower, a property with 115 offices ranging in size from 24 to 160 sq m and rents at 5-6 euro/sq m, said Diakov. In his view, a definite market trend is the investment sale of tenanted office buildings. There are plans, for instance, to sell off-plan Ellipse Center, a project by Belgium’s Ilpa SA. There is also pent-up demand for retail space as Bulgaria still lags Central European states in a 1:3 ratio in terms of retail space per capita, said Albena Stoyanova, manager retail space at Regent s. The EU average is 180 sq m of retail space per capita versus Bulgaria s 64sq m. This segment is expected to experience a 300% growth over the next three to five years, said Stoyanova. Regent s Property Advisors is an AG Capital company. In response to favorable market developments, another AG Capital company, real estate advisors Forton, has decided to spin off into a separate division its brokerage services directorate under the name Regent’s

Bulgarian-Spanish co to build wind park in Varna area

Bulgarian-Spanish company Eolica Bulgaria said it will invest 175 mln levs in a 60MW wind farm near the village of Suvorovo, in the coastal Varna region. The wind resource of the Suvorovo area has been favorably assessed by Spain’s National Renewable Energies Center. The installation of the park’s 30 wind turbine towers will begin 2009 and should be completed by early 2010. The investor is interested in manufacturing components for the wind park equipment in Bulgaria. The VMZ defence company in Sopot is one of the potential local suppliers. The Suvorovo project does not encroach on any sites protected under the Natura 2000 program and will have no negative environmental impact, said the authors of the project. Eolica Bulgaria has signed a preliminary agreement to sell the electricity output to Bulgaria’s national power grid operator NEK

Interservice Uzunovi, Miller to team up for retail park project

Varna-based company Interservice Uzunovi said it will develop a retail park in the coastal city in partnership with Miller Developments, a UK commercial property development company, It was announced on Monday that Miller had paid 120 mln euro to buy the Mall Varna development from Interservice Uzunovi. Miller Developments will pursue local opportunities on the retail park and shopping mall segments, said a Miller executive in charge of retail. According to Interservice Uzunovi, the two partners will set up a joint venture to invest in a retail park near Varna once Mall Varna is completed in March 2008. Miller Developments will assume ownership of Mall Varna after it is completed and commissioned for active use by the regulatory authorities. Interservice Uzunovi has undertaken to secure 80% of the mall tenants. Some 76% of the retail space has been prelet, said Valeri Valchev from Forton International which has the exclusive agency contract. The mall will be anchored by a Piccadilly supermarket and a 1 300-seat, eight-screen Arena multiplex cinema. It will also feature an outlet by youth apparel maker NewYorker and an 800 sq m ice rink. Cushman&Wakefield will be in charge of the operative management of the mall

Chimimport, realty co’s eye sale of region’s biggest wholesale market

There is no strategic investor among the companies that have so far purchased the documents for participation in the sale of Slatina Bulgarplod in Sofia, the biggest wholesale market in the Balkan region, said the city’s sell-off agency. A total of 18 corporations, one consortium and two individuals have bought tender papers to date. Most of the interested companies are in the property business. The list also includes Chimimport Finance, a Chimimport subsidiary, and property developer FairPlay International. The bids for the wholesale market, valued at 75 mln levs, are due by October 17. Experts, including former Slatina Bulgarplod boss Alexander Yotsev, said the asking price was too high. Yotsev recommends to sell the market as a buildable site. The buyer will be barred from altering the core business of the company for a period of 15 years after the sale. Sofia Municipal Privatisation Agency chief Ivan Dimitrov said the sell-off contract will specify a default payment on this clause equal to 100% of the deal price. Slatina Bulgarplod, a member of the World Union of Wholesale Markets, operates on footprint of 45 ha near the Sofia International Airport and major road arteries leading in and out of the capital. The wholesale market, which generate an annual turnover of 2 bln levs, offers 6,000 sq m of refrigerated storage facilities, quality control laboratory, gas station and bank and customs offices. It is also accessible by rail.

Landmark business sold for 210 mln euro

Real estate investment company Landmark has been sold for 210 mln euro to a company set up by two of its managers. Bridgecorp, incorporated by Landmark managers Tania Koseva-Boshova and Richard McDonald, was chosen through an investment auction. Koseva-Boshova said they will continue the development of the acquired company – which has a portfolio of 22 office and retail developments, and will invest in new projects. The transaction price translates into a return of 7% to 8% for the various properties in the Landmark portfolio, said Bridgecorp. In Sofia, the company owns a 5,000 sq m logistics and office building near the Sofia International Airport leased long-term to express delivery company DHL as well as office centers on the Tsar Osvoboditel and Bulgaria boulevards. Landmark is also developing two office properties in Varna, on the Black Sea, and a commercial park in Plovdiv. The company also owns a stake in Black Sea Rama, a joint stock company currently building a golf course and villa resort under the same name near Balchik, on the Bulgarian Black Sea coast.

Managers Buy Out Bulgarian Real Estate Firm

Bulgarian real estate firm Landmark said on Monday it was sold to Bridgecorp, the company owned by Landmark’s two managers, Richard McDonald and Tanya Kosseva-Boshova, for EUR 210 M. Henry Gwyn-Jones, Co-founder and managing director of Landmark, together with the other shareholders in the company, Icelandic mogul Thor Bjorgolfsson and Altima Partners, sold the firm in an auction organised by Credit Suisse Securities, London. The deal is the first of its kind in Bulgaria, where a real estate firm is bought out by its managers. Founded in 2004, Landmark’s portfolio includes 22 properties in Bulgaria and one in Istanbul, Turkey. The firm owns several office buildings in Sofia and Varna, as well as the land on which a gold course will be built. In February, the company announced plans to invest EUR 80 M in projects this year and bought the Porsche Centre in Sofia for EUR 13 M a month later.

Bulgarian construction co Planex eyes Romanian expansion

Bulgarian construction company Planex Holding is vetting the market in neighboring Romania with a view to a cross-border expansion. Things are still at the stage of preliminary contacts but the expansion is just a matter of time, Planex manager Plamen Andreev told Dnevnik. The company executive did not specify a timeframe for the operation. The current priority for the company will be to strengthen and broaden its footing on the domestic market. The to-do list for 2008 includes the completion of several vacation villages and a mixed-use building with a residential component and a built-up area of 40,000 sq m in Sofia. The top project in the 2008 pipeline is the Viva housing compound. It will cost 30 mln euro, including 2 mln euro in land acquisition expenses. The development comprises four residential buildings, two of which have been completed. The total built-up area will be 70,000 sq m. Another 7 mln levs have been slated for the Kavarna City Center mixed-use office and retail scheme in coastal city Kavarna. It will be completed in 2009. Planex is also launching a residential development in Kavarna. The company is currently investing in concrete depots in Varna and Kavarna, said Andreev. They already have excess capacity to take external orders. Planex is a group of 10 companies active in investment planning and management, feasibility studies, construction, assembly and outfitting of residential, resort and industrial buildings

SOFIA RESIDENTIAL PROPERTIES PRICE 20% HIGHER

Property in Sofia’s residential districts where the demand exceeds the supply had raised by 20 per cent in 2006, imoti.bg data showed.The prices of property in the districts where the demand was lower raised by an average of 9.5 per cent, 24 Chassa daily said.Price increase pace of the different types of lodgings became almost equal. The prices of one- bedroom and two-bedroom apartments was increasing faster a few years ago.Construction of retail complexes influenced residential property prices in Sofia, 24 Chassa said. Busines Park Sofia’s construction in Mladost district raised prices of property there from 400 to 650 euro per sq m.Real estate experts said that Mall of Sofia would also affect the prices in the region where it is located. The mall was in the city centre, but the region failed to attract property seekers’ attention before its construction. Mall of Sofia was a pre-condition for the region’s office and residential market to develop.Significant part of the property supply, 15 per cent, was concentrated in the city centre. Another seven per cent of the supply was in the central Lozenets district. Prices varied from 874 to 926 euro per sq m, 24 Chasa said. Technorati Profile