A RECENT networking conference under the auspices of RINFOR, Real Estate and Investment Forum, took place at the Sheraton Hotel in November, gathering investment and real estate companies to collectively discuss the Bulgarian market and its potential. Claimed to be “the largest conference in Bulgaria in the real estate, construction, and tourism sector”, RINFOR was executed in a highly professional manner, with security personnel, an adhered-to programme, speakers divvied into separate conference halls, and an organised registration process.
One of the keynote speakers at the conference was Paul Kornreich, CEO and owner of Bulgaria Real Estate Group. He is an American businessman living in Sofia, one of the few Americans involved in real estate. He was scheduled to deliver a speech on the second day of the conference in a private hall on the subject of The Best Investments in Bulgaria for a Foreigner. As a foreigner knowledgeable about the market, Kornreich has made his way across the country with the knowhow and ability to spot a good find and a promising opportunity. As a former windsurfer and professional skier, he is “uniquely qualified” to speak about beach and ski resorts, a topic he chose as the main focus for foreign investment, because he feels “it’s where all the action is.”
According to Kornreich, the shock that foreigners face when coming to Bulgaria to invest in property is something that can be avoided if they have someone who understands the differences that exist between Bulgaria and their own respective countries, such as the lack of mortgages, the “title deed – tax valuation price scam”, and the VAT issue. It’s taken him two years to truly adapt, and his unique role here enables him to give his clients the “foreign perspective”. The “rush factor” that exists is directly linked to “information availability”, so if foreigners are unable to find some footing, they will be caught up in the floodwaters and pulled under. He says no one is 100 per cent qualified to predict the market or advise clients on where, when and how much to invest, but he says, “no one else is willing to stick their neck out.” However, he has some pretty serious ideas about the future of the market, and with his level of experience and success stories, he is a man worth listening to.
Kornreich believes in the “Bansko Dream”, as he feels, “It has the largest growth potential with its plan to triple its skier capacity.” He sees Bansko as very similar to Aspen, Colorado in 1967 due to its “current prices and future upside”, and he sees a great future for it as an international ski resort if the developers can cut the right key that will bring all the foreigners here: the ski village. He sees “zero interest coming from foreigners” in developing Borovets and buying property there because there is no ski village, which means foreigners used to Western standards who come to Bulgaria to ski will be very disappointed. According to Kornreich, “Pamporovo will be the most exclusive ski resort in Bulgaria. Returns are higher than Bansko, but prices are moving up quickly as word spreads across the foreign investment community.”
At the moment, Kornreich describes Bulgaria is a “raging bull market”, with so much “over-construction” that he feels, “it’s impossible to find a good development project.” He doesn’t necessarily approve of all the construction and development projects along the Black Sea coast, but he says, “I’ve never seen such a demand from apartment buyers – mainly from the UK – even with the negative press.” In the near future, he predicts foreigners will get sick of the overcrowded Sunny Beach resorts and will start to look south of Bourgas. He feels that already that area is better as there are fewer crowds, better weather, better beaches and more seclusion. In the end, apartment buyers are very fickle, and he says, “You’re too late unless you can secure a front line beach location.”
Kornreich is sceptical about the real estate market in Sofia, with its swiftly rising land prices and says, “Bulgarian sellers here are the craziest and most difficult to deal with.” He doesn’t feel so many foreigners will be investing in apartments and is not a believer in the office projects that are springing up all over the city. One point of particular interest that he brought up which resonates with most foreigners is the idea of “the view”. Due to this Western desire for an excellent view, he does feel that some foreign investment will occur in places like Boyana and Dragalevski, with their outstanding views.
He has advice on how to invest money safely in this country and how to work with Bulgarian developers. He’s been in the game for a number of years now and has numerous market predictions that may prove accurate in the coming years. Though there were few foreigners involved in the RINFOR conference, Kornreich’s views and predictions of the Bulgarian real estate market and opportunities for investment for foreigners are intriguing.
