Paradise Center, a lifestyle shopping center, was developed by Bulfeld, Bulgarian company backed by experienced retail developers in Eastern Europe. The project was conceived in 2008-2009 and Forton got involved shortly after the beginning with feasibility study assignment and later on as exclusive leasing agent. The project opened successfully in March 2013 with 80 per cent occupancy and diverse international brand and services mix boosted by expansive entertainment, leisure and lifestyle offer. Soon after opening Paradise Center achieved a stabilized 95 per cent occupancy and added a number of luxury brands for many of which it still is the only shopping mall location.
In 2009, amidst a severe economic downturn, a group of investors approached the shopping center market in Sofia with a brave and innovative concept – to create lifestyle space that would cater to the needs of the whole family and different income groups. Moreover, it was planned to become the largest and dominant retail project in Bulgaria, with around 80,000 m2 of gross leasable area.
The market was already fraying, with a total of 118,000 m2 to open in two projects in 2010 as well as a number of malls throughout the country. Rental levels were already under pressure and the fate of the existing projects was unsecure.
Against such backdrop the developer had to test the viability of the project and back its business plan with market research and financial modeling. But this was by no means a simple desk exercise. The property also had to be leased out upon completion at rates that would allow the developer to repay its lenders and achieve a profit.
Forton was assigned with the feasibility study of the project in the last days of 2009 and delivered the report in January next year. Our Consultancy and Valuations team provided economic and market overviews, assessed the project’s catchment area, retail demand, outlined the marketing mix and delivered operating income and cash-flows projections. The study confirmed that Paradise Center was feasible even in the negative economic context at the time and would be a huge success in a full-speed economic recovery scenario.
After that, Forton was trusted with the chance to prove its assumptions by providing exclusive leasing services. Our efforts helped build awareness and confidence in the project by presenting it on several public events and in direct marketing to interested parties. As a result, a number of international and local key tenants were brought in, including the Inditex brand portfolio (Zara, Bershka, Pull & Bear, Massimo Dutti, Stradivarius and Oysho), H&M, LPP’s Reserved, Cropp, House and Mohito (first mono-brand store in Bulgaria), LC Waikiki, Carrefour, Technopolis, Adidas. The project was also used as a platform for a number of retail concept debuts like upscale multi-brand store Collective, Sport Vision, Dirk Bikkembergs, Original Marines and saw the reinvention of Puma.
When applied at an early development stage, professional real estate advisory services can reap substantial rewards for the project owner. In the Paradise Center case they included the deep understanding of the marketplace and the key strengths of the concept, reputation building and active business customer relationship management. All in all, they resulted in timely opening and consistent performance of the project. In less than two years after opening, Paradise Center was in the position of one of the dominant shopping malls in Sofia and a preferred choice for consumers and retailers alike.