Why the Black Sea suits Yoo

Property overseas: Why the Black Sea suits Yoo

Last Updated: 12:01am BST 13/10/2007


Supercool design gurus building in cheap 'n' cheerful Bulgaria? What's the story, asks Graham Norwood

One of the world's top property brands is working with one of Britain's most respected estate agents to build and market holiday homes - but the location is near one of Europe's least fashionable areas.

New horizons: the view from one of the 257 flats being built at Obzor
Yoo, the brainchild of flamboyant London developer John Hitchcox and French design guru Philippe Starck, specialises in chic and contemporary apartments. Knight Frank, one of Britain's oldest agents, usually sells multi-million pound country piles.

Now they are working together on a scheme of 257 luxurious flats on the beach at Obzor on Bulgaria's Black Sea coast. Prices start at £49,000 - high for Bulgaria, but the cheapest price tag anywhere in the world carrying Yoo or Knight Frank logos.

The first impression when you look at other Black Sea resorts such as Golden Sands and Sunny Beach (both renamed in English to attract the stag night and charter flight brigade) is that they are a strangely modern take on the country's communist era.

The 2007 versions of Stalinist architecture are gaudy high-rise hotels; the creaking infrastructure is not the state industries of old but the resorts' shady shops and bars. But it's not like that everywhere along Bulgaria's Black Sea coast.

advertisementYoo and Knight Frank claim, with justification, that while Obzor is only 45 minutes' drive from Sunny Beach it might as well be a million miles away.

"The Black Sea coast is like Mallorca was a decade ago," says James Price of Knight Frank's international sales department. "There's a bucket shop part for cheap holidays and cheap properties where you get what you pay for. But Mallorca has transformed itself by discreetly developing quieter and more sophisticated areas at higher prices. Bulgaria is beginning to do that and Obzor is the first example."

Visit the scheme, officially called YooBulgaria, and you see that Price is right.

Obzor town sits midway between Varna and Bourgas airports and the development overlooks four miles of sandy beaches shunned by the package holiday masses.

The flats range from studios to three-bedroom penthouses, all overlooking the sea. They will have manicured gardens, four pools, a spa, tennis courts, play areas and a gym.

Sea views here are stunning and uninterrupted, and if this development was on a Balearic island or in the south of France you wouldn't think twice about it - and on Bulgaria's Black Sea coast it is a league ahead of anything else available.

Certainly, Obzor is attracting a new kind of buyer for this part of Bulgaria.

"We were keen on the association with Yoo and wanted to make sure we bought something of high quality," says Alpesh Lad, a London banker who with his wife Mina has bought a two-bedroom flat in the scheme.

"We want a home away from home, a place we can just get on a plane and reach easily. There aren't many good-value beachfront locations like that but Obzor is one of them," he claims.

"I'm intrigued by Bulgaria. Like most of eastern Europe there's clear price growth potential and it is wise to get in before the market matures. The country has beaches, ski resorts, spas - far more than we thought at first."

Developers think so too. YooBulgaria may be one of only a few new schemes on this part of the Black Sea coast but back at cheap and cheerful Sunny Beach, cranes dominate the skyline and building work starts daily at 8am.

Yet despite the high supply, Knight Frank's global index shows Bulgarian prices rising 27 per cent in the past year.

There are also signs that Bulgaria is learning how to control the builders. Planners now forbid building within 150 metres of the coastline - making the Obzor scheme one of the last virtually on the beach itself.

Other upmarket names are now looking at Bulgaria. Estate agents Savills and Hamptons International have sold there in recent months and there are four five-star Kempinski hotels across the country.

Yoo's John Hitchcox says: "Our ambition is to open a market for premium property in Bulgaria that stands up to anything in Spain, Italy and France, yet at a much lower price."

If YooBulgaria is anything to go by, he might just succeed.


Source: http://www.telegraph.co.uk

For more information on Property Investment in Bulgaria, then please contact WW Property Investments

Yields Force Investors to Get Savvy

Yields Force Investors to Get Savvy

8 October 2007, Monday

The managers of a new wave of listed overseas property funds like to offer investors an array of compelling "stories" involving economic growth and expanding domestic markets.

Execution of strategy - the most crucial yardstick of these vehicles' success - has not always been impressive, however.

Nowhere has this been more obvious than in central and eastern Europe, where some funds have been faster than others to find good investment opportunies.

So much money has been filtering into central Europe that yields in capital cities are now only a whisker over those in western Europe. Yields in eastern Europe have also fallen and are now more aligned with the rest of the continent.

Alastair Hughes, Europe chief executive of Jones Lang LaSalle, the agents, says there is a danger that the lower risk premium in the east European market could unravel.

"The difference between an office in Paris and an office in central or eastern Europe has narrowed a hell of a lot - that's an area that people have to be careful about," says Mr Hughes.

Prime yields in western Europe have fallen from 6.25 per cent to 5 per cent while in Budapest they have dropped from 8 per cent to 5.25 per cent, he points out.

Jean-Michel Gault, finance director of Klepierre, the French listed property company, says some investors failed to pay a sufficient risk premium. "There was no real distinction between prime assets in France or the UK and secondary [assets] in, say, Hungary or Poland."

Guy Barker, European head of Palmer Capital Partners, believes most of the European vehicles launched in the past 18 months were "too late" to catch the trend of "yield convergence" across the continent.

By the time many funds were fully invested they had missed the boat, says Mr Barker, former European head of real estate at Invesco.

"The pressure has in many cases led to some rather lazy investments, ones that won't necessarily stand the test or close scrutiny," he says. "They are likely to slightly disappoint."

At the same time, the cost of finance has increased in the region as swap rates are higher than before. German open-ended funds and traditional central European funds have emerged as the most active buyers of real estate.

"The rising cost of finance has taken the speculative and highly leveraged capital out of market," says Gareth Jones, head of capital markets for the region at JLL.

"Whereas a year to 18 months ago there would have been 12 to 20 parties chasing every deal, there are now typically between four and eight bids per transaction."

The gap between prime and non-prime assets, which had diminished to almost nothing, has since moved out again to nearly 200 basis points, says Mr Jones, as the price of secondary property has in some cases fallen.

Some specific markets will still provide rental growth, he says, for example central Warsaw and parts of Prague and Budapest. But rents are more muted elsewhere.

"We remain confident that the market will be strong for prime stock - as elsewhere in Europe there is flight to quality at the moment," says Mr Jones. "At the same time, for highly leveraged investors and investors that have hedge fund equity in their capital pool we have seen market disruption."

Put simply, the wave of capital targeting many of these markets dwarfed the amount of established property which was for sale.

"The problem in eastern Europe is that there is very little product there, set against the amount of money trying to invest. There are a lot of people who have been there for 10 years," says Mr Barker.

European Convergence Property is one fund that found it difficult to invest money as fast as it would have liked. It admitted in early 2006 that it was months behind its schedule. In August this year it said it would sell its remaining property and wind itself up.

Equest Balkan Properties floated in late 2005, aiming to buy investment properties and development sites in east European accession countries. At the time of the launch, a typical yield of 10 per cent was deemed achievable.

But with yields dropping rapidly since then, management has since shifted its focus more towards development. The move has not been warmly welcomed by shareholders, who have rewarded EBP with a fall in the price of its shares. Mike Foster, analyst at KBC Peel Hunt, says: "We believe the management has done the sensible thing in optimising the portfolio, given the changed circumstances." Another group, Engel East, said in August it would not pay a first-half dividend this year.

The more "vanilla" investment vehicles are likely to be superseded by established companies that have development portfolios on the ground.

So who is likely to survive the squeeze in yields?

Guy Meyohas, an Israeli-born property investor, has been doing deals in Bulgaria for the past seven years. During that time he has seen institutions accelerate their spending in the east European country.

Mr Meyohas is a co-founder of Orchid Developments, which floated on Aim in the summer of 2005, raising £20m and giving a market capitalisation of £80m. Orchid's share price has moved upwards ever since and last year it raised another £25m. Mr Meyohas says the secret of the group's success is that it acquires land and develops projects rather than just buying "dry" - that is, completed - product from others.

"Most of the other funds that have been raised are looking for ready product. We are the machine creating product for others," he says. Among Orchid's schemes is a 2m sq ft mixed-use project at Varna on Bulgaria's Black Sea coast, which will include a big Carrefour hypermarket.

Experts say more funds are likely to target markets where yields are still in the double-digits - in Russia, for example. Aisi Realty Public Limited floated on Aim this summer to target the Ukraine, where yields have fallen but are still higher than elsewhere in Europe.

By Jim Pickard
Financial Times

Casa Bulgaria, Sofia, Bulgaria

Casa Bulgaria, Sofia, Bulgaria

Description:

WW Property Investments are once again marketing a great investment opportunity. The outstanding development Casa Bulgaria is situated on Bulgaria Boulevard just after the crossroad with “Todor Kableshkov” Blvd., already a major growth location on the main road to Vitosha Mountain and yet only 10 min drive from the very centre of Sofia.

With European Union acceptance just around the corner, and the new international airport scheduled to open in September, the Casa Bulgaria limited-edition apartments become an offer you simply can’t refuse. Part of the hottest and most developed business area of Sofia, the new development will be surrounded by modern and luxurious residential and office buildings, top-class hotels and various shops and major stores. A preferred place for living, the region also offers clean air, numerous new buildings, schools, policlinics. On the other side of the boulevard is the hyper market Billa, while the elite Boyana District and Vitosha Mountain are some 5 min drive by car.

Casa Bulgaria is a lovely development of two blocks with a common underground floor of 22 garages and 27 cellars, as well as 5 parking lots in front of the blocks. On the ground and first floor of Block A there are offices and shops with separate entrance. The total number of apartments is 27 being one-, two bedrooms and maisonettes, all of them functionally designed. The two buildings are expected to be gasified.

Only 3 hours away from London Heathrow and with an easy, straight-forward buying process, the apartments feature excellent finishes throughout and offer a great deal of space and natural light.

Example Apartments:

Apartment No 1, one bedroom, open-plan kitchen with dining area and living room with outlet to a terrace, bathroom/wc, an entrance, cellar of 3.07 sq.m, total size 72.65 sq.m (actual size + common parts), price 58 744 Euros Reserved BS (S.D.)

Apartment No 2, one bedroom, open-plan kitchen with dining area and living room with outlet to a terrace, bathroom/wc, an entrance, cellar of 3.18 sq.m, total size 70.95 sq.m (actual size + common parts), price 62 742 Euros RESERVED nk

Apartment No 3, one bedroom, open-plan kitchen with dining area and living room with outlet to a terrace, bathroom/wc, an entrance, cellar of 3.18 sq.m, total size 76.50 sq.m (actual size + common parts), price 75 069 Euros RESERVED (dr)

Apartment No 4, one bedroom, open-plan kitchen with dining area and living room with outlet to a terrace, bathroom/wc, an entrance, cellar of 1.99 sq.m, total size 68.81 sq.m (actual size + common parts), price 61 233 Euros RESERVED (am)


Price: £36,736.00
Location: Casa Bulgaria

Area: Sofia

Country: Bulgaria

Type: Apartment

Bedrooms: 1 and 2 bedrooms

Area information: Sofia

Location type: City

Destination airport: Sofia

For more information on this great development or other property investment in Bulgaria then, please contact us now.

EU status increases confidence in Bulgarian property

Bulgaria's resent accession in to the EU has given overseas property investors confidence in the market, it has been claimed, according to BuyAssociation, the property advice web site, while the eastern European country was already popular with investors the fact that it is now a member of the EU - having joined in January this year - means buying property in the Bulgaria is now a lot easier for first time investors.

"It means that the property laws will start coming in line with the rest of Europe," Paul Collins, property editor for BuyAssociation, commented on the development.

"It means there is a possibility that things will become a lot easier to buy and there is some security in the market, because obviously it's got the support of the rest of Europe as well."

Mr Collins believes the popularity of property in Bulgaria as a location for property investment stems from increasing prices in Portugal and Spain as well as Bulgaria's warm climate.

Beach properties along the Black Sea coast, ski developments and Sofia apartments are said to be particularly popular.

Property Sales in Bulgaria
Bulgaria News

Bulgaria has highest rate of property ownership

Own a property in Bulgaria, in fact Bulgaria has one of the world's highest rates of property ownership and tops the chart in Europe, a study shows.

A total of 94% of Bulgarians owned property in 2006, marking an increase of 3% over the previous year, according to the study of international real estate broker network ERA that compared data from seventeen European countries.

Another 60% of Bulgarians own more than one property.

Cyprus and Spain follow Bulgaria in ERA ranking with 85% and 84% of property ownership respectively. At the bottom of the table comes Switzerland with 37.2%.

Europe's average rate of property ownership stands at 68.9%.

Teodora Dimitrova, head of the Bulgarian property branch of ERA, commented that the high rate of property ownership is a powerful engine for the market, because it boosts the potential for selling and buying real estate.

Residential property prices in Sofia remain the lowest among European capital, standing on average at EUR 78 000, ERA says.

Buyers deep deepest in their pockets when acquiring a property in Luxembourg - EUR 485 000 on average.

Property Sales Bulgaria

Source : novinite.com

Investing Bulgarian

Investing in Bulgarian property offers some exciting yields & capital gains if done right. Why invest in Bulgaria ?

Bulgaria has had 7 years of sustained economic growth, with GDP growth averaging 4-5% per annum and inflation contained to single digits

- The national currency, the Lev, has been euro-pegged since 1997 stabilising the economy.

- It has one of the lowest and most competitive tax regimes in Central and Eastern Europe.

- Prices of new build residential Bulgaria property has almost doubled in Sunny Beach compared to 2002! The National Real Property Association (NRPA) forecast that this upward trend will remain for the next few years with an average rise of 10-20% per year until 2007. This is due to a predicted increase of foreign direct and indirect investment in real estate.

- Mortgage lending - it has only been in the past few years that Bulgarians have been able to acquire mortgages. Currently, mortgages represent just 5% of the total credit supply within the local banking sector. And this is the first time foreigners can get mortgages in Bulgaria, which clearly gives more buyers an opportunity to purchase property there, which will in turn generate a much more competitive marketplace - just look at what happened to UK prices, as the mortgage market became more advanced.

For more information on investment property in Bulgaria, please contact us now.

Articles on Bulgaria

Articles on Bulgaria

Bansko budget for the year 2007 is the record-breaking one in the whole of South-western Bulgaria. The leading Bulgarian resort will have at its disposal the amount of BGN 30 million, and thus, if divided per capita of the population, it wins the whole country, even Sofia, the population of which amounts to more than 2 million people. This year’s budget of Bansko is BGN 11 million higher than that for the year 2006, and exactly 10 times higher than that for the year 2003. Eighty percent of the budget, or approximately BGN 22 has been envisaged for investments. Road designs, streets and squares repairs, water-conduit and sewerage, purchase of machines for Urban Development Planning and Communal Economy, an excavator, two buses, security and office equipment, schools repairs, a library, museums, etc., have been included in that item.

The expenditure for education, social activities and culture are entirely covered by private income. The Town Councils of Dobrinishte and Mesta will also be financed by local income. The funds for education amount to BGN 2 344 812, for social activities – BGN 1 006 695, for culture – approximately BGN 900 000, for a ritual hall – a little more than BGN 100 000, for sport and tourism - BGN 100 000. "

Bansko Utre Weekly, 5th April 2007

"A leading European Bank has predicted a 20 per cent annual increase in house price for the next four years, and this growth is likely to be boosted by new low-cost carriers recently launching after accession to the EU."

The Guardian

"Emerging markets like Bulgaria are starting from a lower base than mature markets so there is so much to profit from."

The Daily Telegraph

"The country's post-communist history is a success story with massive growth, a stable democracy and a booming tourist industry."

The Times

"We have added to our directory because everyone wants to go to there."

Thomas Cook Holidays in the Daily Mirror

"Bulgaria has been likened to France, on account of the sparsely populated countryside, sleepy towns and relaxed pace of life of its interior. Like France, it also boasts a coastline and ski resorts but a better climate and a third of the price."

Home Overseas Magazine

"Low price, stable emerging market, sociopolitical improvements, and a magnificent country!"

The Economist

For more information on investment property in Bulgaria, please contact us on info@wwpropertyinvestments.com