Landmark Centre Varna will be offered for sale at a public auction at the initial price of seven to eight million euro on March 21 2012.

The sale of the Landmark business center in Varna with a guide tag of 6.7 million euro will test the attitudes of Bulgarian real estate investors toward a market which surged in volume to just less than 200 million euro in 2011 on the back of foreign money inflows.

Belgrade’s office of real estate advisor Jones Lang LaSalle said on February 28 it will hold the first public auction for property asset sale in the country on March 21. But the building, located in the very center of Bulgaria’s third largest city of 340 thousand, has little chances of attracting the likes of Bluehouse or Europa Capital, who were behind the bulk of deals in 2011, for reasons like Varna’s thin occupational market and general reluctance of international investors to go outside the capital city in the moment.

While the building’s rentable area, which includes some 6,300 of class A offices and ground-floor retail, yields 532 thousand euro from leases that amount for just less than half of the space, locals that could make use the vacant premises are expected to show up at the auction.

Andrew Peirson who runs the Serbian and Bulgarian operations of JLL from Belgrade said, “As it is very early days we don’t yet know how many people will turn up but interest is very high. The majority of this interest is from the domestic Bulgarian market.”

The Landmark building, opened in late 2009 in the place of the ruins of former listed hospital building, has leased to books and entertainment store Public most of the retail space but has since struggled to find office tenants in the competition of a business park on the city fringes and the Varna Towers development.

The asset, initially part of the Landmark portfolio built by former Colliers International executive Tanya Kosseva-Boshova and British real estate professional Richard MacDonald, has been acquired by the latter in early 2011 from Landmark Property Management S.A., the Luxemburg-based company established by Iceland’s billionaire at the time Thor Bjorgolfsson, private equity firm Altima Partners and UK real estate investor Henry Gwyn-Jones to cash in on Bulgaria’s real estate market prior to the European Union accession of the country of 7.5 million. The cash generating buildings of the portfolio were sold to Bulgarian Alfa Finance Holding as the real estate investment market peaked in 2008. Owners had been looked for for the remains, including the Retail Park Plovdiv, sold to London-based fund manager Europa Capital for around 20 million euro a year ago.

As of the end of 2010, prior to the Varna business center transfer, Landmark Bulgaria Park, the asset holding company, owed around 6 million euro to Greek EFG Eurobank’s local arm. “I am working in conjunction with the bank”, Richard MacDonald said on the telephone when asked to comment by Gradat.bg. “I want to sell and the bank wants to sell.”