The Patience of the Long Distance Runner

Eyal Litwin, CEO of Adgar in Poland: First and foremost it is an excellent location in Mokotów, and as well as the fine quality of the building itself and its very good tenant mix, the building is almost fully leased. In the spring we are planning a number of upgrades to Adgar Wave in line with Adgar’s standards, which we have in place in other buildings in our portfolio. These include tenant service software, a new parking system, a new signage system, and Wi-Fi. We will also modernise the structured cabling and the area around the building. Then we will add bike stands, changing rooms and showers for those who cycle into work. We are currently negotiating with a new tenant for the ground floor and I hope to be able to announce who it is soon.

How much did the building cost?

Around EUR 32 mln.

Is Adgar planning any more purchases in the nearest future?

We are working on a new purchase in Warsaw. The building will be larger than Adgar Wave. At the moment I can only say that we are looking at Warsaw city centre. We want to close the transaction next year.

Maybe it’s time to sell something?

We have been in Poland for 15 years now. We are the owners of the Adgar Complex (Adgar Plaza & Adgar Business Center) in Mokotów, which has an area of 38,600 sqm. It is among the most cutting edge properties of this kind in Warsaw, with exceptional infrastructure helping people work more efficiently. Our portfolio also includes Adgar Business Centre II on ul. Konstruktorska, with an area of 8,100 sqm, and a property in the district of Wola, situated on al. Prymasa Tysiąclecia which houses the BMW Inchcape dealership and service point. Adgar Group is currently modernising Adgar Park West which we bought in 2013 – it has 44,600 sqm of office space. So far we have not sold any of our properties and we have no intention of doing so. We are more likely to keep on buying.Adgar is a group that invests for the long term and we are focused on buying high quality properties, which we then manage actively. Taking the long view helps us avoid the pitfalls faced by companies which invest in commercial property in the short term. We are less impacted by market instability and can concentrate on our business.

Your company is planning to develop a data centre in Służewiec. How is this project progressing?

We are in the process of obtaining a building permit and looking for potential tenants. I can tell you now that the architectural concept is very attractive. Once we have the permit we will disclose more details. I can also say that we are obtaining a building permit for a fourth building of the Adgar Park West complex. The complex itself is currently undergoing a thorough modernisation and refurbishment. We would like to expand it with an office building with 8,000 sqm of leasable office space. In December we are opening the reconstructed Adgar Park West, which will feature AdgarFit – a unique 6,000 sqm section dedicated to leisure, sports, wellness and shopping. We see it as a meeting place for fans of an active lifestyle. We are very excited about AdgarFit, as this is our retail debut. We have managed to secure excellent tenants, such as the Gravitan gym, fitness club, restaurant and café, Sport Guru sports and lifestyle store, an Ala ma Kota kindergarten, a Garmin concept store and a PortaMedica Sports Rehabilitation and Medicine Centre and a Sports Dietetics Centre. This is the first project of its kind in Warsaw, with a year-round 900m running track all the way around the office complex.

On average, what is the occupancy rate of the buildings in Adgar’s portfolio?

Apart from Adgar Park West, which is being modernised, all our buildings are almost fully leased. At 75 pct leased, Adgar Park West is an exception, but we are currently negotiating lease agreements for the remaining office space.

Are you talking to large tenants?

Not necessarily, I like small tenants. I know that many landlords hold a different view, but we watch our buildings very closely and manage them actively, with the help of our team. We are also close to our tenants – they all have my mobile number and can always call or text me. And they do. We also look after our tenants by making sure all our buildings have a good tenant mix so that a variety of needs of the people who work there are catered for – like a gym, a restaurant, a conference centre or car wash.

Is Adgar thinking of other cities, not only Warsaw?

We looked at Kraków and Wrocław a year or two ago. The markets there are a lot smaller than Warsaw’s. Added to that our asset management policy requires strong teams of managers on the spot, so it is a big decision for us to enter a new market. And finally, Warsaw is brimming with investment opportunities...