Edition 5 (169) May 2012


Bread and circuses

The most difficult art is that of making money, according to Jan Wejchert, one of the founders of the ITI media group and one of the people on the world's richest list - words that have stuck in my mind. While seemingly devoted to the media business he has also invested heavily in property. But this is the topic for another article.

Ewa Andrzejewska
Investment & finance

The core of the problem

CEE REGION As European investors - spooked by the euro zone crisis and the gloomy economic prognosis - fall back on the security of prime assets, where does this leave the market for non-core product in the CEE region? As Tristam Larder, the director of Savills' cross border investment team, recently stated: "Opportunity funds can't base their business models off future yield compression - they need active asset management angles. Core funds, on the other hand, are looking for prime assets or good quality assets with long leases in ?B+' locations. There is a middle ground of secondary assets with no immediate asset management angle languishing between the two types of buyer."

Nathan North
Retail & leisure

Under one roof

POLAND Nine o'clock in the morning as another Saturday begins, it's snowing outside and you are wading through the snow on the streets of Warsaw from one store to another in search of bathroom tiles, a sink or a fireplace. This is a typical nightmare of many residents of the Polish capital. A construction hypermarket would be a good alternative, for example a Praktiker, a Leroy Merlin, a Castorama or... a complex of stores under the name of DomExpo. The first such centre is to be built in Opole. "We are planning to bring all of the construction industry under one roof. Those planning to do up their homes will find everything they need: developers, designers, surveyors, interior designers, and also shops offering doors, tiles, furniture, lighting and more. At the same time we do not want to be an ordinary DIY or construction market. Our goal is to offer innovative solutions and products," explains Artur Braniec, who is in charge of the commercialisation of DomExpo.

Ewa Andrzejewska

Own homes for families, profits for developers

POLAND Fear makes cowards of us all - and this could have been said of residential developers after summarising their results for Q1 this year. The beginning of 2012 saw the introduction of the ?S' recommendation to the market, which was supposed to turn off the mortgage taps and lower the price limits for apartments included in the Family's Own Home programme. However, developers listed on the Warsaw Stock Exchange only achieved sales similar to those in Q1 2011. In total they found buyers for over 1,400 apartments. According to Reas' figures, the number of transactions on the six major markets (Warsaw, Poznań, Wrocław, Kraków, the TriCity and Łódź) grew by just under 2 pct over Q1, amounting to just over 7,500 apartments. "Admittedly, this was 5.5 pct less than a year earlier, but the result should still be considered a very good one," declares Katarzyna Kuniewicz, the director of market research and analysis at Reas.

Zuzanna Wiak

Small is beautiful ...and cheap

POLAND Probably the smallest apartment in the world was sold in 2010 for EUR 50,000. The area of the apartment was a mere 5 sqm. The 'apartment', on Piazza di Sant' Ignazio in Rome, was built in an alcove where a wardrobe had once stood. It consists of a shower, a washbasin and a toilet, as well as a mezzanine with a place for a bed. The size of the apartment is every bit as shocking as the price it was sold for.

Zuzanna Wiak
Stock market report

Correction without panic

For the global stock markets, the first quarter of the year marked the beginning of a correction. The reasons for this were the relatively strong Q1 results and weaker figures from developed economies


Vicious CIRCLE

Overdue invoices, unpaid liabilities and payment gridlocks are among the most frequent causes of the bankruptcies of Polish construction companies. Payment gridlocks have turned into a nightmare for the sector

Aneta Cichla, Alex Hayes
Office & mixed-use development

Article of bad faith

A weapon of mass destruction, so powerful that few even want to talk about it, is striking fear into the heart of the Polish property market: Article 685.1 of the civil code. A developer can put it to good use - to protect the value of a property. But it can also be employed to get rid of unwanted tenants

Zuzanna Wiak
Retail & leisure

Licensed to sell

Around 7,500 entrepreneurs are planning to open franchises in Poland. But franchising groups are not the only ones who are smiling - provincial shopping centre developers also look set to cash in on the boom

Aneta Cichla
Retail & leisure

Mobile revolution

Shopping centre managers have been peeping into our pockets. And what have they seen there? Around 6-7 mln smartphones. now they have started wondering how they can make themselves pop up on those small screens, offering enticements to their users. Has the mobile retail revolution already started?

Radosław Górecki

Coming home after the wilderness years

The housing markets of Lithuania, Latvia and Estonia have been stuck in the deep-freeze for several years, but now a slight thaw seems to be occurring. Prices are starting to rise - and developers are even thinking about new projects

Anna Pakulniewicz

The envy of the business

T-Mobile has leased 27,000 sqm of office space - in one project! This is the biggest transaction on the market in the last few months and could easily turn out to be the largest of 2012. Polska Telefonia Cyfrowa (the operator of the T-Mobile network) has chosen a Ghelamco building that does not exist yet. The project is being developed at ul. Marynarska 12 in Warsaw. Ghelamco itself is not commenting on the matter, as it is under contractual confidentiality. The T-Mobile deal is not the only transaction that Jarosław Zagórski, the commercial and business development director of Ghelamco Poland, can be proud of. In the last few months Ghelamco has secured a number of other significant leases, including one with PKN Orlen (9,000 sqm in Senator in Warsaw), and is also to build an office for Netia. The developer has signed leases for a combined area of more than 30,000 sqm since the beginning of the year.


What crisis?

At the moment there is a lot of optimism on the Polish office market. Poland has managed to avoid the worst effectsof the financial crisis, which has stirred up the interest of investors. Our market has a dominant position in the region thanks to the high demand from tenants in the BPO/SSC sector. Green, in turn, is the most fashionable colour in the business, not only in Poland, but also in other countries in Central and Eastern Europe. these were some of the conclusions of the??Office and FM Market in Central Europe' conference

Aneta Cichla

A more dubious shade of green

An article was recently published in Polish magazine 'Przekrój' unearthing a behind-the-scenes story about the production of 'green' energy acquired from biomass (i.e. the production of clean, supposedly ecological energy from burning agricultural waste or fast-growing trees).

Radosław Górecki