Real estate developer Equest Balkan Properties has recorded a loss of 9.5 million euro before-tax loss in the first half of 2008, compared to a 9.7 million profit recorded in the first six months of last eyar, on the back of rising finance costs, operating and administrative expenses, as well as falling valuations of its assets, the company said in a statement filed with the London Stock Exchange, where it is listed on the alternative investment market.

Equest's portfolio was evaluated by consultants CB Richard Ellis at 387.5 million euro at end-June. Since then, the developer sold one of its biggest assets, Sofia City Center shopping mall, to Heitman European Property Partners III fund for 101.5 million euro.

The deal is pending regulatory approval, which it expects to receive soon and close the transaction before the end of the year. The deal was brokered and managed by Cushman and Wakefield.

Appart from the Sofia City Center, Equest's investment assets include three shopping malls in Romania, as well as the Business Centre Skopje. All of them are on the trading block as Equest looks to divest itself of mature investments, the company said in its statement.

Bulgarian market reports and statistical analysis indicate that demand for commercial real estate premises in the Balkan region remains inheretenly strong and stable, thus ensuring support for the property market valuations in the future.

However, the epicentre of the problem thath has effected Equest mainly due to the current global environment and financial crisis that has gripped the US and Western Europe, with the ripple affecting business enterprises in Bulgaria as well. According to the company, though, investor demand for prime assets remains firm and given the quality of its property portfolio, Equest anticipated a positive outcome for their portfolio and future business operations.