Gimme shelter

In the first half of 2023, the Polish fire brigade service completed a nationwide inventory of buildings (excluding private properties) that would be suitable for providing temporary shelters. These included cellars, schools and churches, with the work having been commissioned by the MSWiA. The results may seem surprising, because there is enough space in them for 49 mln people, which is more than the actual population of Poland. Nonetheless, shelters (of which there are 224,000) and places to hide (which number over 8,700) are not the same as hermetically-sealed shelters. The national inventory only recorded a little over 2,000 of these, which is decidedly too few. Only this kind of shelter could provide adequate protection, not only during a military conflict but also in the event of natural cataclysms.

Russia’s invasion of Ukraine has certainly had an impact on Polish people’s sense of security. According to a 2023 survey conducted by CBOS, 68 pct believe that Poland’s safety is at risk from armed conflict. People also fear for their future and have started to regard their homes in a different light as they wonder whether they could provide adequate shelter in the event of danger. Climate change is also causing freak weather conditions to become more common, as has recently been seen in the south of Poland and in neighbouring countries when flooding caused widespread destruction. Setting up shelters in apartment buildings will, however, result in extra costs for developers and general contactors, which in turn will mean higher apartment prices.

Paying the price for safety

The design of shelters also requires additional evacuation and fire safety requirements as well as increased costs and additional time for the completion of a development. Krzysztof Tętnowski, the CEO of Tętnowski Development, believes that formulating appropriate regulations is a huge challenge under current global conditions and that it is controversial to make developers responsible for them. “In my opinion, the state should fully guarantee compensating the costs of building such shelters. Otherwise, this will result in a significant increase in the price of properties,” he says. The Polish Association of Developers (PZFD) also points out that prices could rise even by as much as several hundred złoty per sqm and that the construction costs could be 30 pct more than for a standard project.

Mateusz Bromboszcz, the vice-president of Polish residential developer Atal, also has a poor opinion of the proposed bill. “There is just too little time to introduce such measures. Particularly when the rules in their current state are unclear and are open to multiple interpretations,” he complains. He also points out that it is difficult to estimate the specific costs of building shelters and the technological systems needed for them. In addition to that, the equipment required for such buildings is not readily available on the market and, as a result, this could further exacerbate the pricing. “You have to bear in mind that higher development costs will mean higher prices per sqm for apartments and, as a result, buyers will have to face rising property prices. Our preliminary estimates for the additional work and construction of car parks that can serve as temporary (but not as proper) shelters is an extra cost of around PLN 300 per sqm,” he warns.

Tomasz Kaleta, the managing director for sales and marketing of another Polish residential developer, Develia, shares this point of view. “In my opinion, the passing of the bill for the protection of the population and civil defence is going to have a significant impact on the real estate market. For new buildings, the proposed regulations could result in less space for car parks or locker rooms,” he points out. It can also be expected that more time will be spent on the design and on the completion of a project, while the costs of both will increase. As a result, the new regulations may well result in higher apartment prices, the cost of which will in the end be borne by buyers. He also points out that the capital investment costs of construction firms would also increase since they will have to strengthen the buildings under construction, fit the correct ventilation and insulation, and also set up an emergency power supply. On the other hand, the requirement to build shelters could spur technological development and inspire the entire building materials sector. “With such solutions, shelters will not only fulfil their primary use of protection but will also become flexible useable space that could increase the value of the entire project,” says Piotr Koszyk, a member of the board of Q3D Contract.

Now to raid the piggy bank

But do the potential residents of new projects take into account the existence of such shelters? Michał Świętosławski, the communications specialist at Archicom, claims that apartment buyers are not currently interested in whether the estate has such facilities. “The current laws make no such requirement of investors and we don’t see the necessity of building such units. However, we haven’t definitively ruled out such an option when we consider possible changes in circumstances in the future. Our estimates, however, are that the cost of building such a unit would be significantly more than PLN 5,000 per sqm for the total area. The calculations also need to include the upkeep of the shelter during its usage,” he explains. Among the challenges that such projects would entail are the requirement to add the area of the shelter to the building density figures. Developers will also have to ensure their projects comply with the requirements of local zoning plans.

Shraga Weisman, the CEO of Polish residential developer Aurec Home, points out that it is not only the stability of the development industry that is under threat. “All organisations with a stake in the market are going to suffer. This includes local authorities developing social housing, housing cooperatives and social housing organisations,” he says. One hope is that under art. 83 of the shelter bill, local authorities will be able to transfer funds to cover the costs of constructing buildings that provide shelter and such support can cover as much as 100 pct of the costs. Nonetheless, such support would be purely optional. Additionally, the Protection of the People and Civil Society Fund has been set up to support the managers and owners of shelters and such people will be able to apply for up to 80 pct of the costs of constructing a new building or converting an old one.

Bunkers from profiteers

The European leader when it comes to shelters is Finland, which has more than 50,000 of them. The state authorities declare that they have space for almost everyone out of a population of over 5 mln. Some of these buildings are mixed-use, which means they have been in operation for some time. They include classrooms, ice rinks and gyms. In 2022, the German foreign minister Annalena Baerbock visited one of them and said that similar buildings should also be constructed in Germany.

Since the outbreak of the war in Ukraine, interest in shelters has also increased. “There is a lot of demand and interest in this sector because there aren’t too many suppliers. No one could have expected that a conventional war would once again break out in Europe but history, unfortunately, repeats itself. Mario Piejde, the technical director of BSSD, on the Deutsche Welle portal that his Berlin-based company builds shelter systems for private, business and military usage and its products include safety equipment, panic rooms and full-scale bunkers that cost up to EUR 200,000. There can be no doubt that more such buildings need to be constructed but everything points to such activities mainly being undertaken by private companies. André Berghegger, the head of the German Association of Towns and Municipalities, has appealed to the authorities to build more shelters, pointing out that in 2024, there only remained 600 out of the 2,000 public shelters that had been built during the Cold War. “There is an urgent need to once again restore the former bunkers. The shelters that currently operate can only hold around 500,000 people,” he explained to the Funke media group.

The shelter sector, however, lacks systematic solutions that could be used as a reference point for Poland. It cannot be ruled out that once the new regulations come into force, which should be in just over a year, development and construction companies will have to blaze a totally new trail for this sector. And indeed there is little time. “A short vacatio legis period [a period when laws are in force but not yet applied] will not leave much time to make project adjustments. This could lead to delays in launching planned developments and in extreme cases to their abandonment,” admits Andrzej Gutowski, the vice-president and director of sales at Ronson Development.