SPV Structures and Eurozone Investing: Flexibility, Security, and Strategic Advantage
- Nicole Banchevska
- Jul 25
- 4 min read
When it comes to smart investing, especially in real estate within the context of the expanding Eurozone, the way your investment is structured can be just as important as the property itself.
An SPV (Special Purpose Vehicle) is a legal entity created with a specific goal in mind, offering exactly that kind of strategic flexibility and protection.
In this article, we’ll explore what an SPV is, why it’s used by investors, and how it gains even more value in the context of Bulgaria’s adoption of the euro.
What is an SPV structure and why is it used in investment?
An SPV is an independent legal entity, created to hold or manage a specific asset or project, such as a residential building, a commercial property, or a land plot.
Unlike traditional companies that may run multiple operations, an SPV focuses exclusively on one investment.
This makes it an exceptionally effective tool for risk management, ensuring transparency and simplifying reporting.
This type of structure is widely used in international practice and has long been a preferred vehicle for institutional investors, banks, construction consortia, and investment funds.
In Europe, particularly in countries like Ireland, Luxembourg, and the Netherlands, the SPV model underpins many infrastructure and real estate projects involving cross-border participation.
The key advantage of an SPV is that it functions like a “container” - all activity related to the specific property goes through it: acquisition, construction, financing, rental, and eventual resale. This simplifies not only management but also the process of bringing in partners or investors with defined rights and responsibilities.
Benefits of using an SPV for real estate investment
Using an SPV provides several strategic benefits:
Risk isolation – If the project fails, the losses are contained within the SPV and do not affect the investor’s other assets.
Better control – Every financial and operational activity is managed separately, offering full control over the specific asset.
Financing opportunities – SPVs allow for structured project finance deals, where the asset itself secures the loan.
Attracting partners – New investors can easily join by acquiring shares or equity in the SPV.
Simplified exit – Selling shares in the SPV is often quicker, cheaper, and more predictable than selling the property directly.
These advantages make SPVs a convenient instrument not only for large investment vehicles but also for individual investors seeking greater security and strategic clarity.
How does the Eurozone boost the value of SPV structures?
With Bulgaria expected to join the Eurozone in the next 1–2 years, the environment for SPV structures becomes even more attractive:
Currency stability – Eliminates the risk of exchange rate fluctuations between the BGN and EUR, making cash flow management easier and financing more transparent and cost-effective.
Increased trust from foreign investors – The Eurozone represents financial stability and legal alignment, boosting interest in Bulgarian projects structured through SPVs.
Easier access to European financing – EU-based financial institutions and funds are more willing to issue euro-denominated loans to SPVs in countries with a common currency and harmonized regulations.
Harmonization of legal and accounting standards – With Eurozone membership, Bulgaria adopts directives like CRD V and STS, making SPVs fully compatible with regulations across the zone.
In other words, the Eurozone not only strengthens the economic climate but also opens new channels of capital and removes barriers to international collaboration.
How to set up an SPV: Key considerations for investors
Creating an SPV requires careful planning and expert guidance.
Here are the key factors to take into account:
Choice of jurisdiction – In Bulgaria, registration is relatively straightforward, but there are specific tax and regulatory requirements. In other jurisdictions (e.g., Cyprus, Ireland, Luxembourg), further optimization may be possible.
Legal structure – SPVs are most commonly registered as limited liability companies or joint-stock companies, with custom agreements between partners.
Financing model – The balance between equity and debt should reflect the real returns and structure of the project.
Contracts and accountability – Investor rights and responsibilities, control mechanisms, and exit strategies must be clearly defined.
Governance – An SPV must have separate accounting, a tax ID, a bank account, and a management body, typically with majority ownership by the founding partners.
The good news? With the right partner, the entire process can be structured efficiently and transparently.
SPV Structures – A Key Tool in Modern Investment Practice
In an era of growing demand for legally protected and sustainable investments, SPV structures are a logical choice, especially for joint ventures, international participation, or complex assets.
While not a one-size-fits-all solution, well-structured and professionally managed SPVs offer valuable advantages such as clarity, flexibility, and added protection.
In recent years, this model has gained strong traction in the Bulgarian market, particularly among investors seeking transparent distribution of rights, clear reporting, and well-defined exit strategies.
Bulgaria’s upcoming Eurozone membership only strengthens the case for this approach, unlocking greater access to European capital and investor confidence.
SPVs and the Eurozone: Final Thoughts
Bulgaria’s accession to the Eurozone opens up a new investment landscape - one of increased stability, easier access to capital, and higher trust in international transactions.
In this context, choosing the right investment structure, whether it’s an SPV or another vehicle, can be a decisive factor in a project’s success.
There’s no universal formula. But a strategic approach is always possible with the right knowledge, legal and financial understanding, and a focus on long-term value.
That’s the approach we follow at Vaisman Investment Group.
Resources: