Properties in Poland - Introduction
15 Czerwiec 2007
The Polish property market is concentrated in Warsaw, where most business activity and foreign investments are located. The market went through a significant development in recent years and is still growing strongly. As the market matures investments are spreading to regional cities, especially Silesia Region, Poznan and Lodz.
Although they are decreasing, the property market yields are still higher than in Western European countries. Investment yields in 1st Q 2006 went down below 6% in office sector and below 8% and 7,5% in warehouse and retail sectors respectively. The total value of transactions on property market in 2005 amounted to about EUR 2.60 bn, which is substantially higher than the previous year (EUR 1.25bn in 2004).
In 2005 the development of the property market in Poland was driven by a relatively healthy GDP growth (3.2%) and low inflationary indicators. The interest that the Polish property market commands amongst foreign investors is due to the existence of attractive letting opportunities and also to the fact that thanks to low labour costs Poland is seen as an attractive location for service centres of global corporations. Some large companies have already declared their intention to relocate their "back-office" functions (accounting, finance, logistics) to Poland.
The growth in office sector is still mostly seen in Warsaw, where in 2005 about 120,000 sq m of new office space was completed. The figure shows a significant drop in comparison to 2004, however nearly 450 000 sqm are under development and are to be completed between 2006 and 2007.
Significant openings on the Warsaw retail market will take place in 2006 (about 100,000 sqm). In 2005 investors concentrated on retail developments in regions offering high yields. The importance of regional cities is rising significantly. It is estimated that over 1million sq m of retail space is planned or currently under development outside of Warsaw.
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Properties in Poland - Introduction
15 Czerwiec 2007
The Polish property market is concentrated in Warsaw, where most business activity and foreign investments are located. The market went through a significant development in recent years and is still growing strongly. As the market matures investments are spreading to regional cities, especially Silesia Region, Poznan and Lodz.
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