New life for an old district

Case study
With 23 ha and 100,000 sqm of leasable space, the largest warehouse to be developed inside Warsaw’s city limits has certainly been making an impression – and not only due to its size, but also its drone landing site, the insect hotels, rain gardens and the app that will manage the vehicle access

City Point Targówek is being built in Targówek Fabryczny, a district that has traditionally been the site of warehousing and manufacturing. Partners Group together with Peakside Capital Advisors bought the plot with its existing buildings in 2022. “Over the next three years, we intend to develop a new complex of modern warehouse space,” explains Roman Skowroński, the managing director of Peakside Capital Advisors. “This location has a history, because 50 years ago industrial buildings were constructed here, and, for this reason too, it is a site worth rebuilding and investing in,” adds Wojciech Zielecki, the project management director at Peakside Capital Advisors.

The bank providing the finance for the project, Pekao SA, has obviously also recognised its potential, since it has provided a PLN 500 mln loan for the construction of City Point Targówek. “As in every sector of financing, ESG issues have recently taken on an added importance,” points out Łukasz Białecki, the director and head of real estate financing, structured finance and commercial real estate at Pekao SA. “It is important whether an investor has an idea of how to fulfil its green commitments, since ESG requirements are increasing every year. But the people behind the City Point Targówek project have already demonstrated that they can adhere to the changing standards and predict which of them will be important in the future,” he explains.

Recycling on a grand scale

Such a recommendation sounds encouraging, but this is not going to be a simple and quick project to develop. In order to bring the brownfield site back into the Warsaw area’s warehouse and logistics stock, it has been divided into a number of stages, but at the same time this has made the project more complicated. “The effort, resources and time that will need to be put in are of a completely different scale than for a greenfield project; and to add to this, there are other risks that are often impossible to predict when launching work on a new project,” explains Roman Skowroński.

The concept design for the park, including its layout and the shape of each individual building, is the work of the Ferma Kresek studio with input from Midori Project. The old buildings on the site are to be demolished and will gradually be replaced by new ones. The demolition work and its impact are being carefully monitored, not only by the construction supervisor but also by the investor and the general contractor. “During the demolition of the buildings and the removal of the existing paving, we are segregating the waste for recycling. We are only disposing of materials that cannot be recycled, but this happens in only a tiny minority of cases,” reveals Katarzyna Maćkiewicz, a sustainability specialist at Kajima Poland, the general contractor for the first stage, which involves some of the demolition work and the construction of the first building.

The entire development site has been divided into four sections that are in turn are going to be gradually transformed. Originally, twenty-something buildings stood on the site. “We plan to have fewer buildings than this, but the space has been planned out to be more practical. Some of the newly erected space is to be occupied by the current tenants, thus freeing up more buildings for the next stage of the demolition,” explains Wojciech Zielecki.

The life of a tenant

The new park will contain a mixture of both old and new tenants. The first building, which is now ready, is a 7,000 sqm BTS construction that DPD is to move into before the end of the year, following the installation of the company’s most modern sorter in Poland in November. “The building’s high level of complexity was a huge challenge for us, as was tailoring it to the specific demands of the final customer,” admits Paweł Kijanka, the senior project manager at Kajima Poland. Peakside also points out that DPD for the first time ever decided to work with a broker and not to construct the new building themselves.

At the time City Point Targówek was taken over by its current owner, it had 56 tenants – and so ‘Operation Relocation’ had to be put into action. “I’ve been an asset manager for 15 years, but this is the first time that I’ve had to relocate so many tenants and add annexes to their leases,” reveals Bożena Kaczanowska-Tajan, the asset management team leader at Peakside Capital Advisors. “We are putting in every effort to ensure that our tenants’ operations are not disrupted by the ongoing construction work and that they can continue under the same conditions. So far, we have signed 37 annexes to leases and we are negotiating yet more. Our tenants like their location and the layout of the planned park so much that some of them have even agreed to move twice before moving into their final buildings, which is extraordinary. This says a lot about the quality of our services,” she proudly points out.

It’s also worth mentioning another rather unusual tenant in the park. For eight months, Peakside has made space available to the Red Cross for its humanitarian aid work in Ukraine.

Increase the power

City Point Targówek has been designed for different types of tenants. “In the first stage we have space for a logistics operator, but in the next phases we are planning buildings with typical city modules of 2,000–3,000 sqm, followed by an SBU building with units starting from 700 sqm and a BTS building of 15,000 sqm,” reveals Fabian Kowalewski, the leasing and development director for the industrial market at Peakside Capital Advisors.

The later stages have been designed for manufacturing, as both the zoning and access to utilities allow for this. “The fourth section of the park comprises an area of 4 ha, where we have provided substantial access to electricity (40 MW) and an independent entrance. Here we are planning to build a single 15,000 sqm building, designed for the requirements of one large specialised tenant,” Roman Skowroński explains.

According to the investor, due to City Point Targówek’s urban location, tenants can be provided with a virtually unlimited supply of mains gas, municipal heating and electricity. “This is important for pharmaceutical manufacturers and data centres. We are talking about tenants of all types on 23 ha – there’s no other project like this kind in Poland and there are maybe only two or three in Europe,” claims Fabian Kowalewski of Peakside. To this, Bożena Kaczanowska-Tajan adds: “We will also be providing unique and modern solutions in the new park, such as fully-automated entry and exit gates controlled via a smartphone app. This will also be linked to the electric vehicle charging stations and our traffic management system, which, for example, will give users up-to-date information on the availability of parking spaces.”

Some of the more unusual features of the park might still seem a little fantastical. “The project will include landing sites for drones, because we want it to be ready for the transport of the future,” reveals Emilia Jabłońska, an architect at Ferma Kresek.

No greenwashing allowed

Remarkably, the scope of ESG activities in Peakside’s project goes far beyond the framework set by certification requirements. “In preparing the ESG strategy for the whole of City Point Targówek, we first set out our priorities for Peakside,” explains architect Magdalena Zielińska, the founder and president of Midori Project. “Sustainable construction is a very broad term, which is often misused. We were not interested in painting the grass green or any other kind of window dressing. We had a clear understanding of the need for scientific research and solutions that produce real, long-term results,” she says.

In the end, the strategy includes such aspects as water and energy saving and carbon footprint reduction, and it is also inspired by the circular economy and modularity. Some of these features can already be seen in the first stage of the project, while others are to follow in subsequent stages. The grounds of the park are to be landscaped to retain as much rainwater as possible, through the creation of rain gardens designed to do this. A solar power system is also to be installed, which will meet app. 25 pct of the electricity demand. “We are applying for two environmental certificates for City Point Targówek: LEED ‘Platinum’ and BREEAM ‘Outstanding’, along with a Well Health and Safety rating, which is still rare in this sector. For all three applications, the project’s location is of great importance,” explains Katarzyna Maćkiewicz of Kajima. City Point Targówek is accessible by bicycle and public transport, but also (or perhaps most importantly) the complex is being built on a site that was previously occupied by buildings of a similar purpose, which makes it possible to maintain the location’s historic use while keeping the environmental impact down to a minimum.

“City Point Targówek includes many unusual solutions on a scale that has never been seen before. One example is a flower meadow, which we will plant over an area of 0.2 ha. It will also have green walls and green roofs, and we are constantly on the lookout for the best BMS systems. Outdoor gyms and a recreation area are to be provided so that employees can eat their lunch surrounded by greenery. All of these elements in one place will create a place that is ideal to work in and attractive to tenants who want to look after their employees,” insists Emilia Jabłońska of Ferma Kresek.

A clear future

The present is full of new challenges – we are faced with a difficult economic situation and a war to the east. But this project in Warsaw’s Targówek district is being developed with a better future in mind. “We hope that City Point Targówek – with its class and approach to ESG – will become a model for anyone considering brownfield development in the future,” declares Roman Skowroński.