(Read more on the industrial market.)
SOFIA, BULGARIA-Los Angeles-based Tishman International Cos. and GE Real Estate Central & Eastern Europe are partnering to build a $363-million LEED-certified, mixed-use office, hospitality, logistics and light industrial development here called Sofia Airport Center. To be located some 1,000 feet from this capital city's new airport, at full build out the project will be 1.8 million sf of commercial space in two- to three-story retail and other commercial buildings and low to mid-rise office buildings.
Karim Habra, managing director for GE Real Estate Central & EasternEurope, tells GlobeSt.com that the project--one of the first such LEED-certified ventures in the country--is about two weeks out from signing the first preleases. Asking rates, he says, are close to what the market now gets, which is about 16 euros or roughly $23.44 per square meter. Potential tenants include retailers, logistics and storage companies, local and international food companies, and businesses and companies that need be close to the airport. Phase one should be completed next year.
This transaction represents the first joint venture between GE Real Estate andTishman International in the region. The two are using their longstanding relationship in the Americas to expand overseas, according to Alan D. Levy, chairman of Tishman International. Sofia Airport Center is also the first development for GE Real Estate in the country, following two acquisitions it has made in the retail sector--the Mall of Sofia and Mall of Plovdiv.
GE Real Estate likes this market, Habra says, and plans to expand to other asset classes--namely residential housing--and cities from its current holdings, much as it has done elsewhere in Eastern Europe. In countries such as Poland and the Czech Republic, for instance, it GE Real Estate's pattern has been to invest not only in capital cities but also major secondary markets. Romania is another target market in which it would like to expand.
"Bulgaria has great potential because the retail sector is not saturated," he says. "And the office stock is still very small. This project will add a good amount of new product to the market but it will still be significantly underdeveloped."
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
