ECONOMY: the expansion goes ahead

The main economic indicators suggest that Bulgaria’s economy continued to grow at the start of 2025. In January and February, production in the all-important service sector was up, retail sales in constant prices edged higher, and foreign investment increased. The economy was driven primarily by household spending and investments, while industrial production and exports underperformed.

GDP is expected to rise in Q1 2025, but likely at a slower pace compared to 3.4% y/y in Q4 2024 (6th highest in the EU), partly due to somewhat softer consumer confidence. Still, the economic sentiment is firmly in positive territory, suggesting continued expansion.

SUPPLY & DEMAND: large stores gobble up new space

The supply of new retail space was solid in Q1 with deliveries of some 17,000 sqm. Two thirds of this volume came from the expansion of XOPark Sofia.

The total retail park stock in Bulgaria reached 594,000 sqm spread across 60 locations, which amounts to near 75% the stock in shopping malls. The volume of space under construction stood practically unchanged at 164,000 sqm between 11 retail park facilities.

Demand was strong with 57 newly opened stores for near 30,000 sqm. Openings in retail parks amounted to a third of the stores and two thirds of the space. Grocery retailers like Kaufland and Lidl took almost 7,000 sqm in retail parks, whereas fashion brands Half Price and Sinsay took some 3,000 sqm in shopping malls. Store activity was particularly strong in West Mall with as much as 10 new outlets. Among the high-profile openings was the new store of Sephora in Plovdiv Plaza, the first outside Sofia.

PRICING: rents climb higher

The vacancy rate in shopping malls and retail parks remained low across the country. Prime rents in Sofia climbed to 45 euros/sqm in shopping malls and 13.0 euros/sqm in retail parks. Prime yields remained flat at 7.5% in mall and park facilities alike.