May 19 (SeeNews) - The vacant retail space in Bulgaria's capital city of Sofia is expected to increase swiftly this year and recover gradually in 2021, Forton, a strategic partner of Cushman&Wakefield for Bulgaria and Macedonia, said.
After a year of strong leasing activity, which improved the occupancy rate in Sofia malls to 95%, the sector is now negatively impacted by restrictions imposed by the Bulgarian government over the spread of the coronavirus disease, Forton said in a statement published last week.
The economic crisis stemming from the coronavirus pandemic has put many expansion plans on hold, Forton noted.
"The COVID 19 crisis and the government measures to close shopping centers, restaurants and other retail businesses seriously hit domestic consumption which is one of the main growth drivers for the Bulgarian economy," the statement read.
Retailers in the sports goods, health and beauty, fashion and shoes segments are focusing on their online stores, trying to compensate for struggling physical sales. Online sales cannot offset the losses from physical stores’ closures but will likely see a substantial increase in share, Forton noted.
Furthermore, with retail bearing the brunt of the economic fallout rents will inevitably be under pressure in the coming quarters, Forton added.
Following a government decision, shopping malls in Bulgaria were allowed to reopen on May 18 - two months after the government ordered them to shut down in order to limit the spread of the coronavirus disease.