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Sofia – Big business for Bulgaria

6th June 2007 Print
Sofia – Big business for Bulgaria More and more international companies are moving to Bulgaria to set up regional headquarters and most of them are heading for the capital, Sofia. The influx of foreign businesses originally started after the fall of communism in Bulgaria in 1989, when major international companies not already present in the country saw an opportunity and moved in.

These non-native corporations have been attracted by the country’s inexpensive, highly-skilled, multilingual workforce, growth economy, stable political environment and 10% corporate income tax rate. Now with EU membership, the doors are also open for free trade with fellow members, as well as over 20 other countries.

New, totally self-contained industrial zones, such as the Business Park Sofia are cropping up all over the nation’s capital, complete with shops, fitness centres, restaurants, crèches, banks, hypermarkets and hairdressers. Huge multinationals such as Hewlett Packard, Unilever, Sony and Johnson & Johnson have already moved in to these ready-made business havens. Whilst other companies such as FedEx are going one step further and having their new building made-to-measure.

With the establishment of these conglomerates in Sofia is coming a flood of foreign national workers, often from Western Europe and the USA, to the country which has led to an increase in salaries and improvements in the standard of working and living environments. These changes have also attracted the political and economic migrants of the Bulgarian diaspora (currently mainly resident in Moldova, Ukraine, USA, Australia and Germany) back to their native shores to work. As a result, unemployment figures in Sofia are particularly low at just 2.5% (compared with EU levels of 7.2% in March 07).

To house this influx of business more and more commercial and logistics buildings are being built and this increase in construction is due to continue, by as much as 300% (in the next 3 to 5 years according to Colliers Bulgaria). The demand being further fuelled by companies moving to proper office premises out of old residential buildings due to legislation changes.

But it’s not only the increase in commercial property that is driving the market. Residential properties, especially 1, 2 and 3 bedroom western style apartments are springing up all over the city. Not only do the new immigrant workers and the returning ex-pats need somewhere to live, but Bulgarians nationals are heading to the capital from the rural areas, following in the footsteps of Dick Whittington.

Shortages of workers in the construction, tourist and commercial sectors need to be filled and these new city dwellers will need to be housed – not in the traditional grey communist blocks of flats – but in line with their new “westernised” lifestyle. The wealthier Sofian now seeks luxurious, well built, gated complexes complete with swimming pools, shops and cafes and we are seeing more of these being constructed to satisfy this demand.

Developments such as Embassy Suites, which is being marketed by Jet2Let, are now completely ready for occupation. Embassy Suites is unique in the respect that all apartments have very large luxury living spaces with net living areas from 112m² up to 203m², all with impressive extra high 2.9m ceilings, en suite bathrooms and storage rooms and finished to a standard that is probably unmatched in Sofia. Because of this they are very suitable for expatriate rentals and have plenty of open space with landscaped gardens, children’s play areas, underground parking and 24 hour security.

The complex of one, two, three bedroom and penthouse apartments all have stunning views of Vitosha Mountain and are perfectly located at the intersection of the ring road and Bulgaria Boulevard, close to new office buildings and public transport. Bulgaria Mall, Sofia's largest shopping mall complex under construction, is situated just 200m away. The number 7 tram stop is under 200m away and goes to the City Centre.

Also completed in the grounds, and built at the same time by the same developer, is an office development which is now being let to multinational companies, again further enhancing letting potential. Prices start from £101,271 (€148,869) up to £252,252 (€370,811).

With such a high demand for accommodation for both migrant and native professionals, together with the year-round tourist influx, property owners can be confident of almost year-round occupation.

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Sofia – Big business for Bulgaria