At present Sofia had a total stock of 1.2 sq km (1 200 000 sq m) of contemporary owner-occupied and speculative industrial space, according to new Colliers International Bulgaria research. This figure included warehouse, manufacturing and flex buildings.

Of the total inventory, 160 000 sq m was speculative, with warehouses the overwhelming majority of that space, 146 000 sq m. The historic lack of contemporary industrial space had forced many occupiers to choose a build-to-suit solution, Colliers said in their new Bulgaria Industrial Market Overview, for the second half of 2007.

The average sales prices in emerging neighbourhoods in the southern part of Sofia were reaching the 1000 euro for a sq m, according to Colliers. The more established areas such as Doctors’ Garden, Ivan Vazov and Lozenets saw solid double digit growth levels in the first half of 2007, with an increase in the average asking sales prices of 19 per cent, 11 per cent and 19 per cent, respectively.

After a decrease in the second half of 2006, Doctors’ Garden compensated in 2007 and was now just below the 2000 euro a sq m mark. Iztok saw an impressive 51 per cent increase in average asking sales prices year-on-year to the end of June 2007. The supply of residential properties continued to increase at a steady pace and the focus remained on planned communities and compound developments. This type of construction was mainly located in Malinova Dolina, Kambanite, Simeonovo, Dragalevtzi and Krastova Vada but due to increasing land prices, new housing compounds were moving further away from the city.

Rental rates increased only marginally, when compared to sales prices. Levels varied substantially even within the same neighbourhood, depending on location and surroundings, quality, amenities and furnishing, Colliers Residential Market Overview said.

Colliers reported that Plovdiv was becoming an attractive destination for industrial facilities; because of its strategic location it was well-suited for nationwide distribution activities. There was a total stock of 450 000 sq m in owner-occupied and speculative industrial space.

And Bulgaria’s third largest city, Varna, was also catching up, said Colliers, with a total stock of 300 000 sq m in owner-occupied and speculative industrial space. The new Logistics Park Varna would deliver an extra 80 000 sq m in speculative warehouse space over the next couple of years.

Atanas Garov, managing director of Colliers Bulgaria, said, “European Union regulations and requirements have created a need for modern industrial space in Bulgaria. We expect levels of demand in this market to increase steadily.”

Ivan Velkov, general manager of Colliers Bulgaria, added, “More than a third of the total inventory of industrial space in Sofia was located close to the airport, which provided convenient access to ground, rail and air transportation.”

Philip Bay, regional director of Colliers International Southeast Europe, said, “I am proud of the high quality market research we produced. It’s a valuable tool for clients, media and other real estate professionals and just another reason why Colliers International Southeast was the leading property consultants in the region.”

The new research appeared in the Bulgaria Industrial Market Overview for the second half of 2007 and is available for download on the Colliers website (http://www.colliers.com/Markets/Bulgaria/MarketReports/).

In 2007 Colliers International Southeast Europe was named Property Consultant of the Year for the region for the second year in a row.