Confindustria Bulgaria and SDA Bocconi - AUBG, with the support of Galaxy Investment Group, organized a conference "Real Estate market trends and the experience of Europe" at Royal City Business Park, Plovdiv. The initiative was opened by the Italian ambassador, His Excellency Stefano Baldi and Maria Luisa Meroni, Chairman of Confindustria Bulgaria. The event was also attended by Rosen Plevneliev, President of Republic of Bulgaria (2012-2017), Giacomo Mori, professor in Corporate Finance and Real Estate Management at SDA Bocconi, Martin Dragoev, Investments and Sales Director at Galaxy Investment Group, and Boyko Boykov, President of FIABCI Bulgaria.
The market trends and forecasts in the real estate sector in Europe were discussed, as well as the challenges that investors face, the good and bad practices in the different segments - office, commercial, industrial, residential, and other.
The participants united around the opinion that the real estate market in Bulgaria is developing much more sustainably than the previous cycle. "What happened in 2008-2009 is a great warning for Bulgaria. After the crisis, the European Commission did not introduce substantial restrictions, but the industry is self-regulating very seriously," said Rosen Plevneliev and pointed out as examples the markets in Germany and Ireland. He also pointed out that real estate is a good opportunity to invest in the long run, and recommended caution.
During the conference, it was also clear that the office and residential markets in Sofia could be compared with the neighbouring capitals of the Balkans, but generally prices here are slightly lagging behind. “Big projects must be sustainable and a result of the development of a given region. Business prefers to rent because location and characteristics of the property often are more important. The function of a project is not enough, but it is intertwined with the development of the economy, and also the industry is closely dependent on the existing infrastructure”, highlighted Giacomo Mori, professor in Corporate Finance and Real Estate Management at the SDA Bocconi, who has a rich consultancy background in the industry.
“On the other hand, residential space must be customized, that is why property in Europe exceeds 70%. In the long term financial investments generally provide better return, but this requires more flexibility and literacy,” Mori added.
Experts reported Plovdiv also as the new centre of Bulgaria for automotive, outsourcing and IT business. "The growth of industrial zones surrounding the city is of national level, investments in the region and the number of jobs created surpass any other location in the country. The development of the automotive cluster shows the effect of the critical mass. However, not all construction permits will happen in reality. Low unemployment rates and income growth created a demand for residential property,” explained Martin Dragoev, Investment and Sales Director at Galaxy Investment Group. “Our priority target are the high segment of well-informed residential buyers. We are also developing a new office project,” he added. “At the moment, the company invests entirely in five-star hotels in Sofia, which bring a lot of prestige for the country. “We invest also in an industrial project in the southern area of Plovdiv, because competition is already very high in the Northern zone,” Dragoev concluded.