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Nov 01, 2017 17:51 EEST
SOFIA (Bulgaria), November 1 (SeeNews) – The leasing volume of office space in Sofia grew to 131,000 sq m in the first nine months of 2017 - a figure ranking among the largest on record and comparable only to the pre-crisis 2008 levels, commercial property advisors Forton said
In the third quarter alone, office space take-up in Sofia reached 44,131 sq m, 14% down compared to the same period last year, Forton, a strategic partner of Cushman&Wakefield for Bulgaria and Macedonia, said in its third-quarter Office Market Snapshot report published last week. Forton noted that one-off pre-lease of 20,000 sq m has dramatically affected the market volume in the third quarter of 2016.
"Sofia’s office market witnessed one more dynamic quarter thanks to the solid economic growth and tenant appetite for expansion. The supply is still lagging behind, although the completion of a number of large projects in 2017 will be a step towards re-balancing of the market," Forton added.
In 2017, new supply of office property is expected to reach 124,000 sq m, according to Forton. Almost 80% of this space has been already let out, reflecting the shortage of ready-to-move-in prime offices.
As in the previous quarters, expansions of IT and BPO companies are a notable source of activity with about 33% of the leases in the class A segment, Forton added.
Vacancy rates vary in the range 9.2%-9.6% with no prospects for significant change by the end of 2017.
"Development activity in the third quarter remained high with the start of about 30,000 sq m of offices scheduled for delivery in 2019. For the time being, more than 305,000 sq m are under construction, most of this space in suburbs and alongside main roads," the report reads.
Strong demand underpins steady increase of asking rents, Forton said.
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