Eastern Europe Property

BULGARIA TIPPED REAL ESTATE MARKET LEADER IN SOUTHEASTERN EUROPE
Bulgaria is one of the leaders on the real estate market in Southeastern Europe, Bulgarian and foreign experts agreed at a major international forum in Vienna.

“Bulgaria, together with Romania, holds significant potential in the commercial and holiday real estate sectors, where it is joined by Croatia. These will be the most prospective sectors for the next three years,” said Deyan Kavrakov, head of Bulgaria’s leading full service real estate companies ADIS.

Deyan Kavrakov, FRICS, CRE, CLHMS, CIPS, CEO of ADIS Ltd. was a key note speaker at a real estate investment congress in Vienna, titled “The Big Deals 05″.

“In the office sector, demand is getting stable and marks an increase in the multifunctional industrial buildings, which house offices, production facilities and logistics,” Kavrakov said.

He forecasts that price growth in residential sector will slow down and will be no more than 10-15% next year.

“We believe investments in real estate property in Bulgaria are really good and secure investments,” says Gerhard Engelsberger, CEO of Immobilien Anlagen. The company is developing a business center in downtown Sofia and plans further investments in commercial areas.

The “The Big Deals 05″ investment forum was held for the first time, bringing together over 50 companies from Western and Central Europe.

Bulgaria and Romania promise to become the most attractive countries in the South Eastern Europe region for foreign investors.

According to a latest report released this week by the analytical unit of Bank Austria Creditanstalt, investors will be attracted by the good privatisation offers in the two Balkan countries. Besides, since the early 90s the region has been turning into the fastest developing market after Asia.

With an average GDP growth of 5% annually since 2000, South East Europe surpasses the EU member states in its economic development, where the average annual GDP is 3.5%.

Structural changes, related to EU membership, would increase the positive economic developments as the two countries move forward toward EU membership. Bulgaria and Romania would develop greatly after joining the EU and were expected to become leaders in economic growth in the region, the report says.

Tuesday’s report by the European Commission will issue final warnings on Bulgaria and Romania that they might fail to meet deadlines, the Financial Times says.

According to the story, the report on Bulgaria would show that the country has lost momentum in modernizing its administration.

Bulgaria and the bloc have already signed an accession treaty, but the safeguard clause it includes could delay entry by a year.

If activated, the clause would adjourn Bulgaria’s membership until 2008.

“The Commission may recommend that the Council postpone the accession of Bulgaria and Romania until January 1, 2008, if there is a serious risk of any of those states being manifestly unprepared…” reads a draft EU executive report, obtained by Reuters on Monday.
According to reports the European Commission will push the two neighbouring countries to speed up corruption fight and to improve the work of their administrative and judicial systems. Unless tackled, corruption in both countries will threaten the EU’s internal market and EU-funded programmes, reads the report.

The EU executive Commission will officially approve on Tuesday the annual progress report of Bulgaria and Romania, which will assess the implementation of the engagements they undertook in the accession negotiations.

Later in the day EU Commissioner for Enlargement Olli Rehn will present the reports to the MEPs at the European Parliament in Strasburg.

The EC’s comprehensive report will not include any recommendations whether or not to use the safeguard clause.

The Commission will give Bulgaria and Romania six months to deal with shortcomings in the countries’ preparations to join the EU. It will make its final recommendation on whether the two Balkan countries should join the EU in 2007 or 2008 only in the spring next year.