Developer profits still rocketing

The aggregate net profit of the 30 largest commercial property developers in Poland hit an all-time high of PLN 985 mln (EUR 230 mln) in 2018, which translated into a net profit margin of 25 pct. The latest data from the investment transaction market and property developers’ interim financial statements suggest that 2019 could be as good a year as 2018 was for the industry in terms of profitability. The aggregate net profit margin of the 30 leading office, retail and warehouse developers operating in Poland ranged between 17 pct and 26 pct from 2012 to 2018, which represents an average annual margin of 21 pct.One major factor is the solid volume of property investment transactions in Poland, which has been consistently high in recent years and has had a stabilising effect on commercial property developers’ hefty profit margins. The property investment transaction volume topped the PLN 30 bln-mark (EUR 7 bln) for the first time on record in 2018. What is important is that as