Investment Real Estate Market Overview, H1 2018 | EN

H1 | 2018

H1 2018 | България Инвестиционен пазар | Colliers International

MARKET OVERVIEW

1

BULGARIA

INVESTMENT

2

H1 2018 | Bulgaria Investment Market Overview | Colliers International

INVESTMENT SALES TRANSACTIONS VOLUME DISTRIBUTION BY CITY

1% PLEVEN 4% BURGAS

95% SOFIA

HIGHLIGHTS African and Polish investors are leading the flow of capital to Bulgaria.

The total value of completed investment deals in the first half of 2018 was EUR 351 mn. Just five of those transactions accounted for slightly above 80% of the total.

The volume of deals concerning incomegenerating properties considerably exceeded (73%) speculative (9%) and owner-occupied properties (18%).

65% of the investment volume involved office buildings, followed by retail properties (23%) and development land (6%).

Yields maintained their end-2017 levels.

The share of international buyers continued to prevail over locals. South

TOTAL SALES TRANSACTIONS VOLUME (MN EUR) 957

1000 900 800 700 600

565

500 400

351 234

205

210

262

H1 2018

2017

2016

2015

118

2013

2008

0

59 2012

18 2011

27

2010

100

2009

200

2014

300

TOTAL SALES TRANSACTIONS VOLUME BY SECTOR

65%

23% OFFICES

6% RETAIL

3% DEVELOPMENT LAND

3% HOTELS

INDUSTRIAL & LOGISTICS

3

ORIGIN OF INVESTMENTS (MN EUR) H1 2018 | Bulgaria Investment Market Overview | Colliers International

838 800 700 600 500

506

400 300

245

202

200 100

59

27

16

87

8 51

31

2012

2013

102

132

101 109

117

144

119

106

0 2008

2009

2010

2011

International buyers

2014

2015

2016

2017

H1 2018

Bulgarian buyers

TRANSACTIONS TYPE (MN EUR)

900 800 700 600 500

PRIME YIELDS

400 300 12%

200 100

11%

Income generating

Speculative

Owner-occupied

H1 2018

2017

2016

2015

2014

2013

2011

2012

2010

2009

2008

0

10%

10% 9%

8.25%

8%

7.25%

7% 6% 2008

2009

2010

Offices

2011

2012

Retail

2013

2014

2015

2016 2017

H1 2018

Industrial

FORECAST Office and retail are the segments likely to show high investment potential by the end of the year; transaction volume in 2018 is not expected to exceed the 2017 level, due to the scarcity of large assets for sale.

Investment volumes registered in 2017 indicate improved market liquidity, making Bulgaria more attractive to new investors in 2018.

The available debt capital for real estate acquisitions will likely remain stable.

Continuing strong tenant demand will likely determine a further expansion of the development pipeline and more property acquisitions.

FOR MORE INFORMATION

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

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.

Copyright Š 2018 Colliers International.

Colliers International | Sofia European Trade Center 115K Tsarigradsko Shose Blvd.

Build. B, 7th floor 1784 Sofia | Bulgaria colliers.com Colliers International | Bulgaria