Another string to BIK’s bow

Logistics beginnings

Kraków-based company BIK, which began with developing warehouse and logistics properties, has been operating on this market for 14 years. “We have built warehouse halls all over Poland. In addition to Kraków, we also operate a warehouse park in Sosnowiec and have built a facility in Ożarów Mazowiecki – this was sold to the Arka BZ WBK fund in 2005 – and Pruszcz Gdański, which was sold to British fund Guardian in 2008,” says Mirosław Koszany about the company’s activities. Following the slight slowdown in the wake of the credit crunch, the company is now resuming projects with renewed vigour. “We have a plot near Kraków, in the Niepołomnice district, and the interest in this area is clearly increasing due to the lack of suitable plots in Kraków. We want to build two more buildings there with a total area of 20,000 sqm,” says the president of the board at BIK. When will this happen? “Purely speculative areas are not being built today. We will not start the project unless we find a tenant for at least some of the space, a minimum of 40 pct. We are planning to start the construction work next year,” adds Mirosław Koszany. The company is also thinking about continuing a project in Sosnowiec, where it owns a warehouse area of 35,000 sqm. “Another 30,000 sqm could be added in three halls. Two of these are already being designed and so we are looking to obtain a building permit in the spring. The logistics market in Upper Silesia is a very interesting and promising one. However, it needs to be constantly monitored in order to fit projects in at the right time. A lot of relocations of larger tenants are taking place and so we are remaining vigilant. We are targeting tenants who are looking for small and medium-sized areas with substantial office space adapted to individual requirements. These are more stable tenants with whom long-term cooperation is possible. And they are the ones we want to build for,” emphasises Mr Koszany. The company also has land in Wrocław, among other locations, but is not planning any projects around the city at this time. It is not planning to sell its facilities, either. “There’s not going to be anything like the shopping spree on the logistics market that took place in 2005 and 2006. At that time funds were buying warehouses and diversifying their portfolios. However, it turned out that their unfamiliarity with the specificity of this business put them off from making similar purchases. There are few funds that do specialise in warehouse projects, mostly targeting the purchases of large logistics real estate portfolios. We do not have such large facilities in our portfolio. However, if we receive any good offers, we have not ruled out selling. Nonetheless, nothing is forcing us to do this,” stresses the head of BIK.

Branching out

Biuro Inwestycji Kapitałowych has now also made a name for itself as a developer of small retail facilities in medium-sized and small towns. “The crisis of 2008 admittedly put our logistics plans for other locations on the back-burner. Taking into account the fact that the warehouse market was seriously impacted by the changes at that time – when vacancy was increasing at an alarming rate – we decided to enter the promising retail market in order to diversify the risk,” explains Mirosław Koszany. After a few years the company completed its first project – a retail park in Puławy, which was opened in 2011. “It has an area of 2,700 sqm. And we are very satisfied with it,” says Mr Koszany of the park. The end of this year will see the opening of a 6,300 sqm mini-mall in Bielsko-Biała, featuring tenants such as Biedronka, Apteka Ziko, Pepco, Neonet and Decathlon. The company is also finalising a leasing contract with a large fitness club. Another facility is to be opened in Lower Silesia. “We are working on a small retail project in the centre of Dzierżoniów, right next to the town’s market square. We would like to start the construction work next year, although we had originally planned to open it this year.
However, the current situation when it comes to leasing retail facilities means that from the purchase of the site it takes 3–4 years to finish a project. We currently have contracts signed for 1,500 sqm in the 5,000 sqm project,” he explains. A number of other smaller facilities will be built by  BIK in southern Poland, mainly south of the Poznań–Warsaw line. Mirosław Koszany insists that money can still be made from retail properties in smaller markets, even though the returns are relatively lower than for larger centres. “Developing a retail project in a small town poses another challenge – you need to take on board that it might be more difficult to sell such a property because investors are still not interested in such products. So you need to manage the facility and look after it for a longer period of time,” explains the head of BIK.