Research & Forecast Report Bulgaria | Investment Real Estate Market H1 2015
Investment Market Overview
• The total value of closed transactions on the investment market in Bulgaria in the first half of 2015 was slightly above 90 mln EUR. It is expected by the end of the year the total sales transactions volume to be similar or higher than in 2014, depending on the development of the Greek debt crisis.
Total Sales Transactions Volume (mln EUR) 600 500 400 300 600 200 500 100 400 0 600 300 500 200 400 300 200
• About 60% of the buyers in 2014 were Bulgarian companies. They continued to dominate during the period with a diminishing share from the total volumes.
100 0
2007
2008
2007
2008
2009
2010
2011
2012
2013
2014 H1 2015
100 6000 500
2009
2010
2011
2012
2013
2010
2011
2012
2013
2014 H1 2015
2012
2013
Bulgarian Companies` Share 400
2014 H1 2015
600 300 2007
500 200
2008
2009
600 400 100 500 300 0 400 200
2007
2008
2009
2010
2011
Total Sales Transactions Volume
2014
H1 2015
Bulgarian Buyers
300 100 200
0
100
46% 2009 2008
2007
2010
2011
Total Sales Transactions Volume 2007
2008
2009
2010
600 Total Sales Transactions Volume
2011
400 700
2013
2014
H1 2015
38% 85%
2007
2008
2009
38%
85%
2010
Greece & UK 2011 2012 85%
400 700 2007 2008 300 600 700 200 500 600 100 Investment Market Overview | H1 2015 | Colliers International 400 500 0 2007
2008
2009
2008
2009
2010
2009
2010
2011
2010
2011
2012
2011
2013
38% Romania, Turkey, Kazahstan, China, etc. 2014 H1 2015
Romania, Turkey, Kazahstan, China, etc.
Greece & UK
2007
Romania, Turkey, Kazahstan, China, etc.
Greece & UK
}} } } } }
USA & UK
0
2
2012
USA & UK 46%
300 600
600 100 400 500 0 300 400 200 300 700 100 600 200 0 500 100
H1 2015
46%
500
700 200 500
2014
Bulgarian Buyers
Buyers` Profile (mln EUR)
• In the recent years the pool of investors and origin of capital represented in Bulgaria became more diversified. In addition to the typical US and Western European investors, new players from Romania, Turkey, Greece, Kazahstan, China and other countries entered the market.
2013
USA & UK
}} }
0 700
2012
Bulgarian Buyers
2012
2013
2013
2014
2012
2013
2014
H1 2015
H1 2015
2014
H1 2015
} }
100 200 0 100
• The speculative transactions were prevailing on the investment market in the last two years. The explanation being that the Bulgarian market remains in the development stage with a limited number of class A office properties.
2010
2011
2012
2013
2014
H1 2015
0 2009EUR) 2010 Transactions Type (mln 700 2007 2008
2011
2012
2013
2014
H1 2015
2007
2008
2009
2012
2013
2014
H1 2015
600 700 500 600 400 500 300 400 200 300 100 200 0 100 0
2007
2008
2009
2010
2011
Income Generating Transactions 2007
2008
2009
2010
Speculative Transactions 2011
Income Generating Transactions
• The low volatility of the yields in 2011 - 2015 is due to capital markets lagging behind, as well as the relatively small share of pure incomegenerating properties from the total sales transactions volume. The development opportunities and the strong occupational market are also attracting significant amount of capital.
Romania, Turkey, Kazahstan, China, etc.
Greece & UK
200 300
2012
2013
2014
H1 2015
Speculative Transactions
Prime Yields 14% 13% 14% 12% 13% 11% 12% 10% 11% 9% 10% 8% 9% 7% 8% 6% 7% 6%
2007
2008
Offices 2007
2008
Offices
2009 Retail 2009 Retail
2010
2011
2012
2013
2014
H1 2015
2012
2013
2014
H1 2015
Industrial 2010
2011
Industrial
Forecast • 2015 total sales transactions volume is anticipated to reach at least the 2014 volume, depending on the availability of product for sale • Foreign investors are expected to steadily increase their share in the total sales transactions volume • Rental upside, discounts on existing debt and lower interest rates would continue to drive investor returns • Occupational markets in Western Europe and Tier 1 CEE lag behind Capital Markets; Strong occupational markets in Bulgaria will continue to attract more capital
3
Investment Market Overview | H1 2015 | Colliers International
502 offices in 67 countries on 6 continents United States: 140 Canada: 31 Latin America: 24 Asia: 199 EMEA: 108
$1.7
billion in annual revenue
Georgi Kirov Director Investment Services +359 2 976 9 976 georgi.kirov@colliers.com Adriana Toncheva Senior Market Researcher +359 2 976 9 976 adriana.toncheva@colliers.com
Colliers International | Sofia European Trade Center 115K Tsarigradsko Shose Blvd. Build. B, 7th floor 1784 Sofia | Bulgaria TEL +359 2 976 9 976
158
million square meters under management
16,300
professionals and staff
About Colliers International Colliers International is a global leader in commercial real estate services, with over 16,300 professionals operating out of more than 502 offices in 67 countries. The company operates in Bulgaria since 1991 and delivers a full range of services to real estate users, owners and investors worldwide. Presently Colliers represents some of the most innovative and professionally planned projects in all market segments, including office, retail, logistics, industrial and residential. As of June 2015, Colliers is an independently owned company. The common shares of Colliers International Group Inc. trade on the NASDAQ under the symbol “CIGI” and on the Toronto Stock Exchange under the symbol “CIG”. As part of the CEE Quality Awards 2015 Colliers won for the fourth time in a row the Industrial agent of the year award. The latest annual survey by the Lipsey Company ranked Colliers International as the third-most recognized commercial real estate firm in the world. colliers.com Copyright © 2015 Colliers International. The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of the material contained in this report.
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