The gradual accumulation of new office buildings due to be completed and opened for business throughout 2010 will have a "dis-balancing" effect on the market and keep prices low because of excessive over-supply, a study by real estate consultant firm MBL and global consultancy CB Richard Ellis was quoted as saying by Stroitelstvo Gradut weekly on January 12 2010.

According to MBL, about 72 000 sq m of office space were rented out in 2009 nationwide, making it the lowest rate in five years, since total completed office space amounted to 165 000 sq m. Additionally, about 375 000 sq m of new office space is expected to be made available on the market in 2010.

"Regardless of the faint signs of resurgence and demand increasing marginally, the outlook for 2010 appears to be 'difficult' for the office sector," MBL said.

Rents across the country have fallen by 30-40 per cent, after peaking in the first half of 2008, with "quality office buildings" now going at a rate of between nine and 13 euro a sq m monthly, Stroitelstvo Gradut said. Additionally, the "nationwide demand never exceeded 160 000 sq m annually".

Historically, this is "unprecedented growth" for the Bulgarian market, which now stands at about 1.1 million sq m of office space and is expected to increase by a third in 2010.

Analysts have said that office buildings in the Sofia city centre are likely to feel the brunt of the rental prices correction as new and spacious new office space is made available in abundance outside the immediate centre. Until now, prices in Sofia city centre which reached 25 euro during the peak period before the global economic downturn and have mostly retained their value in 2009.