At the beginning of the year?J.W. Construction announced that it was increasing its activities in the commercial development sector.Józef Wojciechowski, president of the supervisory board of J.W. Construction Holding: Residential construction has been the foundation of our business for nearly 20 years. However, we would like to grow further. So we have analysed the market and decided to extend our strategy. We have diversified our revenue sources both in geographical terms and with regard to the segmentation of our business. The decision is also meant to generate stable revenue during the downturn.
What are the company's plans in this sector over the next few years?
There is work currently pending on the commercialisation of the completed Jerozolimskie Point project, which offers over 4,000 sqm, and the Hanza Tower mixed-use development in Szczecin. Our portfolio also includes hotel projects. A four-star hotel with app. 150 rooms is being developed in Szczecin, in an old part of a building. In September we are opening Czarny Potok - a four-star hotel with a five-star spa in Krynica Zdrój. It will feature 187 hotel rooms as well as 42 suites, four restaurants, a night club, six bars, a disco, nine conference rooms plus a recreational swimming pool, a complex of baths and massage and treatment rooms. We are also preparing for the sale of a project developed in Sopot. It is a product for a very select group of clients, including 19 finished luxury seaside apartments with top class hotel infrastructure. The finishing work on its interior is currently in progress. Also, the construction of Galeria Jagiellońska in Białystok is to start in Q4 later this year. The shopping centre will have a leasable area of 50,000 sqm with around 230 tenants.
The company is planning to extend its commercial activities and at the same time has put its Hotel 500 in Tarnów Podgórny and Hotel 500 in Stryków up for sale. Why was this decision taken?
This is part of our plan to study the market. We want to get a better idea about the value of the hotels and check the level of investor interest in properties of this type. However, if a client with an interesting financial proposal comes along, we would be prepared to finalise the transaction.
In April your company bought land on ul. Kasprzaka in Warsaw. What is going to be built there?
The final work on the design is pending, but it will be a self-sufficient ?mini-town'. We want its residents to have access to the full retail and service infrastructure within the estate, and so we are planning to build a commercial facility with a useable area of over 72,000 sqm. However, the project will not be a traditional shopping centre - we do not have permission to build retail facilities with areas exceeding 2,000 sqm on this site. Our concept involves creating a project which will take on board these limitations, but it will offer a modern retail area at the same time. In July Warsaw city council passed a local zoning plan for the site of the estate, so we are very close to the start of construction.
Does extending your commercial property portfolio mean limiting your operations on the residential market?
Residential properties are the basis of our business and will continue to be so. I am also going back to the beginnings of my development activities, to the times when I used to build luxury villas in the US. Our offer includes detached houses now - twelve show houses are already available for viewing in the Villa Campina estate in Kaputy near Warsaw. I think this is the first exhibition on this scale in Poland. In addition, the residents of Villa Campina will be able to use concierge services.
What is your residential offer to be in the nearest future?
We are currently constructing six residential projects and planning to launch three more. Two of these will be built in Gdynia and another in Poznań. Over the next two years app. 6,430 apartments will come onto the market, of which 26 pct will be outside Warsaw. The capital city is of course the fastest growing and the most profitable market and we want to continue our operations here; however, the number of projects will depend on the economic climate. Our company's strategy is now to put a lot of emphasis on geographical diversification.
What goals does the company have over the next few years?
Our main aim is to move into niches in regions with the highest potential for growth with unique designs and sales concepts for luxury projects. It would be hard to go in a different direction for development at this point because of the difficulties involved in financing the purchase of an apartment and the ending of the Family's Own Home programme to help home buyers, which have both considerably weakened the market.
Interview conducted by Zuzanna Wiak
