Varna Logistics has procured a EUR 22 mln loan facility to fund the development of its 132,500 m[sup]2[/sup] logistics park in Varna, the third largest city in Bulgaria. The park is the company's sole asset. Varna Logistics was bought in October 2006 by Bulgarian Property Developments (BPD) and FairPlay Commercial in a 50/50 joint venture. Currently, run-down industrial buildings occupy two-thirds of the site and are tenanted, producing a net return of 5.3% per year. The rest of the site is vacant.
Varna Logistics has procured a EUR 22 mln loan facility to fund the development of its 132,500 m2 logistics park in Varna, the third largest city in Bulgaria. The park is the company's sole asset. Varna Logistics was bought in October 2006 by Bulgarian Property Developments (BPD) and FairPlay Commercial in a 50/50 joint venture. Currently, run-down industrial buildings occupy two-thirds of the site and are tenanted, producing a net return of 5.3% per year. The rest of the site is vacant.
Fairplay and BPD plan a mixed-use development for the site, to include trade showrooms and a supermarket. The vacant part of the site will be developed first and will have two 5,000 m2 warehouses together with associated offices, a multi-storey car park and a parade of shops with offices above. Initial building works on this part of the site have already started. Once the new buildings are occupied and let, the rest of the property will be redeveloped.
The loan is for three years, with an option to extend it when the project is finished. It should cover 88% of construction costs.