Galaxy Investment Group’s office projects meet the strong demand for high quality office space
The Bulgarian office market performed very well in 2015. According to the commercial real estate advisory company Forton, in 2015 the volume of office space deliveries in Sofia was almost 105,000 sqm. As of the beginning of 2016 about 200,000 sqm were under construction. The expected completions by the end of 2016 are about 70,000 sqm but nearly half of them are small-sized or owner-occupied projects. For this reason, the present year will offer limited opportunities for expansion or office consolidations in comparison to the demand.
The office market recovery encouraged investments and new projects have been started or resumed. The market is dominated by IT and BPO companies attracted by the overall progress of economic activities in Bulgaria and the skills of national IT professionals. The strong demand of IT and BPO companies for high standard offices requires open office space and spacious areas, availability of amenities and excellent technical infrastructure. According to Forton, in Sofia the vacancy rate in the top 10 office projects dropped to 3%.
Currently, the key priority for Plovdiv is development and promotion of an IT and BPO business-friendly ecosystem that will turn the city into a regional IT and BPO hub. Investors from high-tech companies are attracted to the highly qualified labor in the outsourcing sector graduating from Plovdiv’s universities and the favorable conditions for doing business in the city. Driving solid interest of the IT and BPO companies to expand in Plovdiv resulted in strong leasing activity and fuelled the office development. Office Park Plovdiv is a project by Galaxy Investment Group that meets the high requirements of high-tech companies for modern office spaces and offers build-to-suit development schemes. Located next to Mall Plovdiv and the Rowing Canal, the project consists of two identical, adjacent phases. Office Park Plovdiv will welcome its tenants in September 2016 and is already 40% leased.
With increases in the demand for office space, long-term leases, stable cash flows, and 8.0-9.0% yield, significantly higher than in other EU countries, the sector attracts more institutional investors. The office space market offers more opportunities for investments in income-producing properties.
A great example for this is Sofia Business Tower, another project by Galaxy Investment Group. It has an area of 10 112 sqm, located in the most developed and preferred business area in Sofia. The routes of buses and metro pass in close proximity to the site and provide fast communication with the other parts of the city. Nearby are located numerous amenities. The project includes a 24-floor building (Block A) and an 8-floor building (Block B and C). It has a total built-up area of all levels of 91 742 sqm with net leasable area of 8 022 sqm, four underground levels with total of 675 parking spaces. Sofia Business Tower has 22 office floors and the project allows the separation of large offices on one floor, up to 3 500 sqm. The technical characteristics of the building meet the highest standards for modern office spaces. Sofia Business Tower creates an opportunity for a profitable investment in a dynamic market.
Galaxy Investment Group develops office projects that meet the highest requirements for modern workspaces. Plovdiv and Sofia are put in a high priority, cities with long-term development potential, a diversified economic profile, qualified human resources and sustainable growing demand for modern office space.