Sofia Office MarketSentiment Report

May 2012

2

Methodology

Type of research Quantitative

Method Online survey

Fieldwork Period March 2012

Sample size 307 companies

3

Executive summary (1 от 2)

Participants in the survey share positive attitudes toward the Bulgarian economy’s development in2012.

The target companies are also optimistic about the development of the industry they operate in andconsider that 2012 will keep the same pace as 2011.

36% of respondents assume an increase of their income.

57% will keep the same number of employees, while 20% even intent to increase their personnel.

Around 90% of the interviewed companies stated that the supply of office space exceeds the demand.

The respondents align as top 5 high quality office projects the following ones:

Business Park SofiaEuropean Trade CenterSopharma Business TowersMegaparkSerdika Offices

4

Executive summary (2 от 2)

As determinant characteristics of high quality office project, respondents defined:

Environment and convenient location

High quality of construction

Parking space

Approximately 1/3 of all interviewed companies have never thought about the quality of the environmentthey work in, but 50% would renovate their interior in correspondence to the established standards forecology construction.

Still the companies are more prone to rent than to buy their own office premises.

5

Outlook for the overall Bulgarian economy in 2012

Base: 307 companies

In your opinion, what is the outlook for the overall Bulgarian economy in 2012?

Same as 2011

Positive compared to 2011 Negative compared to 2011

22%

38%

39%

As a whole, the interviewed companies are

with positive attitudes toward development of Bulgarian economy in

2012.

6

Outlook for the industry, the interviewed companies operate in Bulgaria in 2012

Base: 307 companies

In your opinion, what is the outlook for the industry you operate in during 2012?

Same as 2011

Positive compared to 2011

Negative compared to 2011

30%34%

36%

Regarding the industry the companies operate in, they predict 2012 to keep the same pace as

2011.

7

Expectations towards company’s income

What are your expectations towards your company’s income in 2012?

To stay at the same level

To increase

To decrease

Base: 307 companies

36%

26%

38%

The companies are optimistic and according to 36% the income during 2012 will increase.

8

Number of employees

How many employees does the company currently have?

Base: 307 companies

32%

16%

15%

11%

8%

17%

0% 5% 10% 15% 20% 25% 30% 35%

Up to 20 employees

21-50 employees

51 – 100 employees

101 – 200 employees

201 – 500 employees

Above 501 employees

9

Plans regarding the number of employees during 2012

Till the end of 2012, what are your plans in terms of the number of employees in your company?

To maintain the current number of employees

The number of employees will decreaseThe number of employees will increase

Base: 307 companies

20%

16%

57%

7%Do not know

More than half of the researched companies consider to maintain

the current number of employees during 2012, and even 20% have intention to

increase the personnel.

10

Sofia Office Market, Current Situation

According to you what is the current situation on the office market in Sofia?

Да

Не

Base: 307 companies

88%

4%8%

The supply of office properties exceeds the demand

The demand of office properties exceeds the

supply

Do not know

According to approx. 90% of the interviewed companies the supply of office properties in Sofia exceeds the demand.

Office Projects Supply

Do you consider the current rental levels of office projects are aligned to the market

conditions?

Base: 307 companies

70%

21%

8%

Yes

No

Do not know

In your opinion is the supply of high quality office projects in Sofia sufficient?

35%55%

9%

YesNo

Do not know

High quality office projects in Sofia

Base: 100 companies

Which office building in Sofia can be classified as of high quality in your opinion ?

22%

21%

11%

8%

5%

4%

4%

2%

2%

1%

20%

0% 5% 10% 15% 20% 25%

Business Park Sofia

ETC

Sopharma Business Towers

Megapark

Serdica Offices

Este

Litex tower

Bellissimo

Abacus

Mall Sofia

Do not know

Characteristics of high quality office projects

In you opinion what characteristics an office project should possess to be classified as of high quality?

Base: 307 companies

Respondents define the environment and the

convenient location as determinant

characteristics of a high quality office project.

30%

23%

9%

5%

3%

3%

3%

3%

1%

18%

0% 5% 10% 15% 20% 25% 30% 35%

Environment and convenient location

High quality of construcion

Parking

Easy access by car

Image of the building

Overall costs

Availability of Property/ Facility management

Convenient public transportation

Proximity to governmental and financial institutions

Do not know

Quality working environment

In your opinion, do the office premises you are occupying currently provide quality working environment (quality illumination, sufficient fresh air, low levels of harmful

emissions of the finishing works)?

Base: 307 companies

44%

30%

26%

Yes No

Do not know/ Never thought about it

Would you consider to renovate the interior of your office premises in correspondence to the

standards for ecology construction?

48%

17%

36%

Yes

Do not know/ Never thought about it

No

Real estate characteristics

Interviewed companies are:

Base: 307 companies

45%

18%10%

26%

What is the approximate size of your current head office in Bulgaria?

Rent their office premises

Own office premisesHave both rented and

owned office premises

No answer

Approximately half of the researched companies

rent their office premises.

26%

15%

13%

10%

11%

25%

0% 5% 10% 15% 20% 25% 30%

Up to 200 sq m

201 sq m – 500 sq m

501 sq m – 1000 sq m

1001 sq m – 2000 sq m

More than 2000 sq m

Refuse to answer

Real estate characteristics

What is the level of satisfaction of your head office premises in Bulgaria?

Base: 307 companies

What is the contract duration for the office premises you rent?

46%

47%

1%

7%

0% 10% 20% 30% 40% 50%

Very satisfied

Satisfied

Unsatisfied

Very unsatisfied

13%

20%

11%

16%

39%

0% 10% 20% 30% 40% 50%

Up to 1 year

Between 2 – 3 years

Between 4 – 5 years

More than 5 years

Refuse to answer

17

Thank you!