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The rented office space in Sofia has increased almost three times at the beginning of the year

The share of vacant office space in Sofia remains stable with a symbolic decline to 16.4% since the beginning of 2022. At the same time, the segment registered one of its strongest first quarters for the last five years in terms of rented space - 44 000 sq. m.

The data show that despite the impressive volume of new leased space, net utilization currently remains modest - 8,600 square meters. The market continues to move mainly from relocations and renewals of contracts, rather than from expansions. Thus, the retention of vacant space levels can be explained by the lack of newly completed projects in the first quarter of 2022. Office buildings under construction are also at low levels, with just under 200,000 square meters under construction in Sofia.

The areas in the signed contracts during the period exceeded almost three times those at the beginning of the previous 2021, when the volume of newly hired offices was only 16 thousand square meters. The deals mainly reflect the desire of tenants to consolidate or improve the offices they live. There is still a tendency for companies to focus on higher-end business buildings and new projects on the market.

Shared spaces are becoming an increasingly important element of the office environment as they attract the attention of companies looking for flexible solutions. Since the beginning of the year, the area of ​​shared offices amounts to 45 thousand square meters, and with the opening of MyFlex Coworking and another similar project, this area is expected to exceed 50 thousand square meters by mid-2022.
Rents remain stable for another quarter - 15 euros per square meter for the central city and business and 12-14 euros per square meter for buildings along the main boulevards. Rising operating costs are putting landlords under pressure to increase maintenance fees, with levels in Sofia ranging from 2.75 to 4 euros per square meter. m.

The market of retail space in our country is recovering from the pandemic with the coronavirus and remains stable. The main focus remains on retail parks and big-box sites. Drivers of demand remain fast-moving goods, drugstores and sporting goods - these retailers continue to expand both in Sofia and in the country. Discount chains and budget fashion brands that have entered the market in the last few years are also opening new stores.

The total area of ​​the retail parks is currently 219 thousand square meters, and another 153 thousand square meters are under construction or planning.

This market segment is developing extremely dynamically and there are already the first signs of consolidation. Some of the big players are developing their own portfolios of projects, while others are focusing on acquisitions of operating projects or those under construction. Larger owners in the segment are already emerging on the market.

With a total volume of 815 thousand square meters, the segment of shopping centers again remains without new projects. This trend is expected to be reversed after the announced start of construction of a new shopping center of the NEPI Rockcastle fund in Plovdiv.

The lack of new shopping centers also affects the relatively modest volume of newly opened sites in the first quarter of 2022. In the largest market in the country - Sofia, the share of vacant space remains stable - 5.6%.

Rental levels in shopping malls in Sofia are also unchanged at 34 euros per square meter, while in retail parks prices are rising slightly to 10 euros per square meter per month. The levels in the retail parks in the country remain between 7 and 9 euros per square meter per month.

 
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