Playing it safe

Bruno Le Corre, the managing director of Bouygues Immobilier: We certainly don’t expect Miasteczko Orange to be our final project. We are already preparing another project of about 20,000 sqm of useable space in the same neighbourhood. The land is owned by us,
we’ve obtained a building permit, and we’re talking with potential customers about a build-to-suit contract. We expect to start building it in the first half of 2014 and to finish by the end of 2015. The working name of the project is ‘Nettuno’, but this could change in the future. It is important that Bouygues Immobilier has substantial experience of BTS office projects in its home market in France. We are the leader of the office sector there in terms of innovation. In 2011, for example, we built the first large-scale (app. 23,000 sqm) positive energy building, which produces more energy than it consumes. Thanks to renewable energy sources, such as solar panels and other green technologies, after one year in operation the building consumed 2 kWh less electricity per sqm annually than it produced (the production amounted to 63 kWh per sqm per year). It is fully leased to IT firm Steria and was sold to the Scor group of financial services companies.

Should we also expect such positive energy-balanced buildings by Bouygues Immobilier here in Poland?
Unfortunately this depends on the climate, which is quite different here in Poland to what we have in France. Therefore, the implementation of this concept in Poland still requires some research, but we are willing to develop such kinds of technology in Poland.
Miasteczko Orange is not a positive energy building, but it did receive a BREEAM certificate with a ‘Very Good’ grade at the design phase and it may well become the biggest office building in Poland to receive BREEAM ‘Excellent’ certification. Regarding energy efficiency, the building was designed to use 30 pct less energy than a typical class ‘A’ building.

Why have you chosen a strategy of developing BTS office projects instead of competing on the speculative market like most developers?
Developing build-to-suit projects is a fantastic way to respond to the expectations of our customers. You actually work with them, you try to understand their expectations, and you try to provide the solutions that fit in with their needs. We don’t want to operate like everybody else: buy a plot designated for office use, build the car park, and after that wait for tenants to appear. This does not chime with our experience, our knowledge, or culture of doing business.

Is there a market for BTS offices in Poland?
When we entered Poland in 2002, the office market was really young and not yet mature. People used to think that BTS offices are more expensive and this kind of arrangement was not popular on the market. But this is not true. Rents do not depend on whether this is a BTS building or not. If you design a building without having any particular tenant in mind or design it for someone in particular, the process costs the same. All that is required is to change people’s mentality. In France we develop build-to-suit offices starting from 10,000 sqm. But we could even develop 5,000 sqm projects as well.

Here in Poland, so far you have mainly been known as a residential developer. Why did you enter the office market so late?
Developing residential buildings is a pretty straightforward process. You buy a plot, you design a project, and you start selling apartments as soon as you have the building permit. With BTS offices it is a different story: it takes time to meet potential tenants, discuss the projects with them, understand their expectations, explain the process, design the building with the tenant, and finally construct it.

In terms of sales 2012 was your record year during your ten-year presence in Poland. You sold 350 apartments and 20 houses. The situation on the residential market, which is seen by many as a difficult one, doesn’t seem to be affecting you?
It is true that the market is difficult. It does not allow any mistakes to be made, therefore you need to minimise all the risks. But we are trying to offer realistic prices for the right locations and we have also benefited from the Rodzina na Swoim [A Family’s Own Home’] programme. But the thing that is helping us the most is the experience we gained in France. We are a developer with a pedigree of around 50 years and have already survived four or five crises back home. Our experience here in Poland, where GDP still remains in positive figures, I would not even call a crisis – it is more a case of the market adapting to the reality of the Polish economy. We are still interested in all of Warsaw’s districts and are not currently planning to expand to other cities. Our target is to sell roughly 400 apartments this year and slowly but surely increase that number over the next few years.