Demand rises for bulgarian office space

Photo: Lauras Eye

Demand is rising for Bulgarian office space this year, as the economic outlook improves.

Research by Bulgarian Propertyes shows that demand for office space has risen in the first half of 2015, as companies become more confident in both the country's financial outlook and their own future.

Demand is being driven by the IT sector, notes the site, although the outsourcing industry is also a significant player. Interest is also largely fuelled by smaller businesses looking for space lower than 500 square metres. 

Over 60 per cent of demand for office space comes from companies with multiple offices that are looking to consolidate their space under one roof. The rest comes from companies looking to open a new office.

80 per cent of the enquiries come from companies that plan to start working with up to 50 people but often there is a potential expansion of these needs. Some of the enquiries aim at satisfying greater needs from the beginning and are looking for greater office space that would allow 70-80 and even 100 people to start working immediately.

While there is supply for smaller office space demand, though, there is a lack of supply of space bigger than 1,000 square metres.

However, several new deliveries of buildings are expected by the end of the year, which will help to improve supply.

Overall vacancy rates are around 15 per cent, although newer offices have vacancy rates of under 5 per cent.

"This shows that when the building is well-planned and managed low levels of vacancy rates are achievable and the return for investors is high," says the report."

"The market reality as of today – the increased demand for office space on the one hand, and the increased supply on the other – makes it possible to expect a stable office market in Bulgaria for at least the next 12-18 months."