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Bulgaria offers Russian property investors safe haven -officials 16:47 Thu 09 Oct 2008 - Nina Todorova Bulgaria will continue to be a safe haven for Russian property investors despite the global financial crunch, a panel of Bulgarian officials have said during Sofia-Moscow video conference that is part of a series on the prospects of Russian-Bulgarian cooperation in the field of tourism, organised by Russian news agency RIA Novosti organized at the Hilton hotel in Sofia. The panel included Deputy Foreign Minister Milen Keremedchiev, the chairperson of the national association for real estate Luchezar Iskrov, the managing partner of Address real estate agency Katya Tsenova and the editor-in-chief of Index Imoti magazine Deyan Todorov. The bulk of Russian investors are 25 to 45 years old second-home owners along the Black Sea coast, who may or may not open businesses in Bulgaria, the panel participants said. Climate conditions, short distance from permanent residence and agreeable prices in comparison to other EU destinations compel them to build on their coastal activities and seek opportunities in the mainland. The critical mass buys a vacation house for 100 000 to 200 000 euro. Still more Russian investors buy complete apartments and houses in small and mid-size Bulgarian towns to develop businesses at ski- and medical therapy resorts. Total foreign investments in Bulgaria in 2007 amounted to 5.7 billion euro, of which 36 percent come from property investment. Russian investments made up for 39 percent of the grand total and 45 percent of the property acquisitions in particular. Statistics for 2008 are as yet unavailable. Keremedchiev briefed Russian officials on the e-Visa application system, effective March 2008, which enables foreign citizens to apply for Bulgarian visas online. The most beneficial way to invest in Bulgarian property for a Russian citizen is to enter the country on a one-year business visa, register a firm and acquire property as a legal juridical unit. A three-year business visa follows at the end of the first year, allowing the Russian investor to spend more time developing businesses in Bulgaria as well as the rest the EU. http://sofiaecho.com/ German firm Degi buys Mall of Sofia 11:47 Mon 13 Oct 2008 - dnevnik.bg German company Degi has acquired the Mall of Sofia shopping centre, said the anti-trust authority, which should rule on the deal. Sources told Dnevnik daily that Degi Deutsche Gesellschaft fuer Immobilienfonds was also a bidder for the capital's City Center Sofia but lost to US company Heitman, which offered 101 million euro. Degi's marketing director and press spokesman Dietmar Mueller declined to comment until the deal was wrapped up. No financial details or yield about the new sale are available. City Center Sofia was sold at a 7.1 per cent yield. In 2006, Mall of Sofia went to Irish investment fund Quinlan Private and GE Real Estate. It was previously owned by Israeli companies Ocif and Aviv, each with a stake of 25 per cent, and IT International Theatres with a 50 per cent stake. Mall of Sofia was unveiled in May 2006 in downtown Sofia and has a built up area of 73 000 sq m. All 130 shops have been rented out to major global brands for 30-60 euro a sq m a month. The complex boasts Bulgaria's first 3D cinema and 12 other cinema halls. Source: Dnevnik.bg Sozopol sets sights for the rich and famous 17:36 Tue 14 Oct 2008 - Nick Iliev The municipality of Sozopol, a Bulgarian Black Sea resort town, has implemented a construction plan, which aims to attract the rich and famous. Affluent tourists will be teased with the creation of a small airport for private aircraft, with a runway spanning 1.8km between the Ravna Gora and Izvor villages, Bulgarian construction news website stroitelstvo.bg reported. Sozopol chief architect Roumen Alexandrov and the mayor of the town Panayot Reizi have unveiled the plans which also include a 30ha recreational park near Gradina Camping. In addition, a new port and three golf courses will be built. The municipality owns the land that one of the golf courses will be built on, and the other courses will be on land currently used for farming. The local authorities want to create a new image for the resort and provide sleek, chic and modern tourism for the affluent from Bulgaria and abroad. The tourist industry will have several targets, categorised according to the different types of tourist. Sozopol boasts a very rich history with many archaeological sites and ruins which enhance the area's interest for tourism. The nearby island of St Nikola will be developed as a "tourist super centre", the website reported. The infrastructure surrounding the airport, the villages Ravna Gora and Izvor and other villages close to Sozopol will take two years to complete. Within 18 months, the waste water treatment station in Sozopol will be operational and would service the municipal centre, the villages Ravadinovo, Chernomorets, Atiya, Dyuni and Alepou. http://sofiaecho.com/ Kibela Royal holiday village to rise near Balchik 12:16 Wed 15 Oct 2008 - Svetlana Guineva A new holiday village, conveniently located close to the golf course that is being built near the Black Sea town of Balchik, will rise on about 27 000 sq m land plot, weekly Stroitelstvo Gradut reported. Investor of the project is Britannia-Balchik Inc., a partnership with British shareholders, while the design is done by architects Svetoslav Stanislavov and Delyan Zhechev from the Varna-based Disarch studio. Kibela Royal will be situated in the Tabiyata area and will feature one- and two-family buildings winding in a spiral-like shape, surrounding a middle ground with entertainment and recreation zones, and several outdoor swimming pools. The buildings bend in a shape of a crescent and a single driveway entrance from the south side will lead into the complex. Every building has an adjoining parking lot, and according to the plan, there are 195 parking spaces. There are 58 one-family houses with a total built-up area of 8328 sq m. The building's entrance faces the outer street and each one has a small backyard. On the roof there will be a large balcony, which has the potential to be transformed into a living area. Ten of the one-family houses are connected, according to the plan, and form a different type of three-level buildings with a total built-up area of 1809 sq m. Two small blocks feature buildings with 200 one- two- and three-bedroom flats. Their total built-up comes to 16 000 sq m. According to the plan, there will be a communal building facing the pools, which will include spa centre, a fitness hall, outdoor bar area, café on the balcony and administrative offices.
Designers have paid special attention to the village's landscaping and every building is envisioned with flower stands of its façade. http://sofiaecho.com/ Price of property average Bulgarian family can afford down 9.4% 17:04 Fri 17 Oct 2008 - Nick Iliev Due to the net decrease of earnings and the increase of interest rates, the average Bulgarian family was able to afford a house 9.4 per cent cheaper in August 2008 than exactly 12 months earlier, according to statistics worked out by website investor.bg. This is provided the borrower takes the loan in Bulgarian leva rather than euro, in which case the decrease is lower - 4.7 per cent, the website said. This year, wages have increased by 12.7 per cent, but this rise has been offset by an even steeper increase of expenditures - 14 per cent - which transpires into a net decrease of earnings by 1.3 per cent. The annual savings power for a typical Bulgarian household has decreased by 32 per cent this year, as compared to figures from last year around. Bulgarian National Bank data shows that interest payments for the average mortgage have risen by 1.18 per cent, to an annual 9.53 per cent. A twenty-year fixed-interest mortgage with an annual increase of 1.18 per cent would suggest that the house that the average family can afford is 8.1 per cent cheaper than in August 2007. The interest rates on loans denominated in euro have increased to 7.94 per cent, meaning should the mortgage be paid in euro, the house would be 3.4 per cent cheaper. In nominal terms, this means that by taking a loan in leva, with the monthly payment of 700 leva, the average Bulgarian family will be able to purchase a house for 75 000 leva, as opposed to 81 500 leva last year. Should the loan be taken in euro, the same family could buy a house for 84 000 leva, as compared to 87 000 leva a year earlier. The majority of loans given to borrowers for mortgages this summer were in Bulgarian leva, investor.bg said. So far, the statistics indicate that 57 per cent of the first or second mortgages for purchasing or refinancing of houses, be it cash out or no cash out, are done in leva. The falling purchasing power of Bulgarian consumers is expected to have a cooling effect on the property market in Bulgaria, which has been in recent years one of the main drivers of foreign direct investment and economic growth in the country. http://sofiaecho.com/ Property prices in Pamporovo down 15% -realtor 17:41 Mon 20 Oct 2008 - Nick Iliev The global financial crunch has had its effect in the tourist resort town of Pamporovo, Bulgaria. The flats available in the numerous apartment estates recently built in the town have declined sharply in value, according to Yavlena GEOS, a real estate agency based in Smolyan, quoted by website stroitelstvo.bg. The first decline in value was observed in the hotel-apartment complexes, especially in the cases where there is a larger loan taken out for their construction. On the internet, there are offers selling apartments in the hotels for three million euro, or the equivalent of 475 euro for a square metre, whereas the typical detached apartments in Pamporovo that are on offer now go in the range of 900 to 1200 euro a square metre. The drastic decline in the value of the apartments is a consequence of the sharp decrease in demand from foreigners to purchase property in Pamporovo. This is of course is accredited directly to the global financial crisis which is hitting the westerners hard, and with Western banks being reluctant in releasing loans for the purchase of property overseas, fewer people in turn can afford the mortgage payments and the interest in Bulgarian based apartments has dwindled. Until now, British clients were the main players on the market, with Irish, Russian and Spanish expats in close pursuit. However, there are fewer foreigners interested in buying, instead there are now cases of foreigners re-selling previously purchased property in order to reclaim as much as possible from their initial investment, Yavlenasaid. The wind of change is being felt on the market in Smolyan as well, with a sharp decline in the demand for property in the last several months after loan interest rates have gone up to further hit the already shrinking demand. http://sofiaecho.com/ Bulgarian real estate slumps in value 13:26 Tue 21 Oct 2008 - Nick Iliev The Bulgarian real estate market has enjoyed years of gradual growth, with prices constantly being on the upturn providing a healthy climate for the sector. These were the days of predictability and affluence. Not anymore, being on the outskirts of the hurricane of financial trubulence slowly approaching the country from the West, prices have taken on a sharp decline, as offers on the leading property websites in the country show. Single family homes, shops, offices and land plots are show a decline ranging from two per cent in the most modest instances to as much as 10 per cent in larger towns and cities across the country, data from websites topimoti.bg, imoti.net and imot.bg shows. In some grimmer cases, owners have slashed prices by as much as half in a direct consequence of the global credit crunch, the subsequent rising inflation and the waning purchasing power of the population. For the full story, please visit propertywisebulgaria.com BREF REIT prepays 20.16M leva loans 10:41 Wed 22 Oct 2008 - dnevnik.bg Bulgarian Real Estate Fund, the local real estate investment trust (REIT), has prepaid two loans from Eurobank EFG Bulgaria, worth a combined 20.16 million leva, to avoid interest payment, the head of the fund's project manager Kaloyan Ninov said. The loans financed the purchases of 78 000 sq m of land plots in Sofia's Mladost district and a building in the Borovets resort complex in the town of the same name. The company sold some of the properties to repay the bank loans, which both bore floating interest rates based on the Euribor inter-bank interest rate. The REIT has taken another seven million leva loan from Eurobank EFG Bulgaria to buy stores in Varna and Sofia, now rented out to do-it-yourself retail chain Mr. Bricolage. Source: Dnevnik.bg Mortgage rates hit new highs in September 10:42 Thu 23 Oct 2008 - dnevnik.bg Four Bulgarian banks raised the interest rates charged on lev-denominated mortgage loans in September, data from moitepari.bg website, which compares loan and personal finance offers of different lenders, showed. The Moite Pari leva-denominated index, which tracks the average annual interest rates of 20-year mortgages, picked up five basis points to reach 9.61 per cent, the highest since was launched at the end of 2005. Five of the fifteen leading local-currency mortgage lenders tracked by the index have revised their mortgage loan terms. Only Municipal Bank cut by the price of its most popular mortgage loan by two basis points after the central bank lowered its benchmark rate, the website said. The price of Allianz Bank Bulgaria's loans jumped by 0.76 percentage points as the interest rate grew nearly as much. Raiffeisenbank's Bulgarian arm added 30 basis points to the rate of its best mortgage offer, and the new service fee brought the total increase to 0.38 percentage points. The SOFIBOR index rising 0.15 percentage points in September drove up the price of ProCredit Bank's mortgages by 0.13 percentage points. UniCredit Bulbank made a milder increase, adding eight basis points and halving application fee, for a total increase of seven basis points. The Moite Pari euro-denominated index rose almost twice as quicker than its local-currency counterpart due to price hikes by EIBank, Allianz Bank Bulgaria, UniCredit Bulbank, Raiffeisenbank and ProCredit Bank. Up by nine basis points, the average annual interest rates of 20-year mortgages denominated in euro is now 8.46 per cent. Source: Dnevnik.bg CEE region to have 6B euro new malls in 2009 11:51 Fri 24 Oct 2008 - dnevnik.bg Shopping malls are booming in Central and Eastern Europe, where projects worth a combined three billion euro will open doors by the end of 2008 and a further sic billion euro next year, an analysis by market research firm PMR Research showed. Bulgaria is tipped for the second fastest growth in the region with its shopping mall market seen rising seven-fold to 760 million euro next year. Malls in Slovenia will top 99 million euro only to rise nine-fold to 882 million euro in 2009. Bulgaria's rentable shopping space will surge 350 per cent from 2007 to 2009, and Slovenia will see an 800 per cent boost. The report is silent on the toll that financial turmoil will taje on the segment, but analysts have warned that the credit squeeze may kill some of the planned mall projects. Almost half of the CEE's shopping mall space lies in Poland with Bulgaria holding a humble two per cent of the total. Romania now has 10 per cent of the total but is set to rise to second place on the back of the current construction boom, analysts have said. Source: Dnevnik.bg Bulgarian property prices gain 3% on average in Q3 13:19 Fri 24 Oct 2008 - dnevnik.bg The prices of Bulgarian residential properties have increased on average by three per cent to 1418 leva a sq m in the third quarter of 2008, compared to the previous quarter, data from the National Statistical Institute has showed. Flats sell for more than 1000 leva a square metre in half of the country's 28 administrative centres. Brokers say the market is settling and switching to stand-by mode as some sellers have withdrawn hoping for better times, while others are chopping off prices with loan installments digging deeper in their pockets. Property prices in Bulgaria's second largest city of Plovdiv have seen the biggest rise, growing by 11 per cent, followed by Dobrich in northeastern Bulgaria, where residential property was up nine per cent. The increase hovers around five per cent in the other regional cities. Prices went in nine major towns, with Shoumen posting an eight per cent drop. Home prices in Varna, Bulgaria's biggest Black Sea city, registered their first fall, be it a negligible eight leva a sq m. Sofia retained the lead as Bulgaria's most expensive city, with appartments selling on average for 2470 leva a sq m, a 6.8 per cent quarterly rise. The runner-up was Varna with 2129 leva a square metre, followed by Bourgas with 1755 leva a sq m and Plovdiv with 1655 leva a sq m. Source: Dnevnik.bg Buyers snub holiday properties 11:22 Thu 23 Oct 2008 - dnevnik.bg Bulgaria's holiday property market was saturated and big projects found no buyers because they were unprofitable, the managing director of Foros real estate agency Dobromir Ganev has said. Local company Terra Trans Consult has suspended a 200 million euro holiday village project in Balchik due to the severe economic conditions, the town's mayor Nikolai Angelov said. The company's Balchik Paradise complex was to deliver houses, a hotel, a spa centre, a conference hall and a cinema hall. Tsonko Tsonev, the mayor of neighbouring Kavarna,however, has said that none of the investors in projects near the town were selling their developments, nor suspending construction work. The tight credit market has not dampened demand for homes, but it did cause buyers to scale down the amount they were willing to invest, while also becoming less picky about the size, floor, exposure and location of the property. Buyers were moving to more peripheral areas where prices were lower, Ganev said. While investment purchases have not stopped, prices were now lower than even a year ago, he said. The latest trend was to buy stores and rent them out, he added. Farmland prices have gone through the roof with some selling for 20 000 leva a ha. Farmers, however, were facing difficult times because of frozen European Union subsidies, which made further increases of prices unlikely. London-listed property funds squeeze Bulgarian Projects 11:59 Mon 27 Oct 2008 - dnevnik.bg A large portion of the fund's portfolio is focused on the holiday segment, which is feeling the full force of the financial crisis with supply much bigger than demand, analysts have said. Photo: Georgi Dimitrov Two funds listed on the alternative investment market (AIM) of the London Stock Exchange said they would slash real estate investments in Bulgaria because of the ongoing financial crisis. Black Sea Property Fund gave up its Evergreen gated complex that it planned to build in the country, while Bulgarian Land Development (BLD) has slashed the number of apartments it agreed last year to buy in the Paradiso Verde 2 complex in the Bansko mountain resort. Sofia's housing segment has not yielded to the crisis yet, but credit is tight and some other segments are saturated, Black Sea Property Fund said in a statement. The fund said that it had steady cash resources and would revise its Sofia project to pick the most efficient time and the way to use them. BLD cut the number of flats it bough off-plan at a discout of 30 per cent in the Paradiso Verde 2 project to 55 from 100. When agreed, the deal was worth 3.7 million euro. A large portion of the fund's portfolio is focused on the holiday segment, which is feeling the full force of the financial crisis with supply much bigger than demand, analysts have said. Meanwhile, the Sunday Independent reported Irish homeowners are trying to shed Black Sea properties even at a loss. |
