PL

Wild days are over

Retail & leisure
Fewer greenfields, some brownfields, more redevelopments and probably residential projects. These are the niches Acteeum Group is now interested in in Poland. ‘Eurobuild CEE’ talks to Arne Bongenaar, the company’s managing director, on what is now happening.

Recently you have bought two Polish retail projects together with Rockcastle: Galeria Tomaszów in Tomaszów Mazowiecki and Fabryka Wołomin in Wołomin, so now you co-own a total of five projects in the country. Why is the Polish retail market attractive to you?

Arne Bongenaar, the managing director of Acteeum Group: For us the Polish retail market is very interesting. There are still some areas where supply of modern retail space stands below international standards and there is a need for modern retail space. But it is a limited market today. Unlike in the past years, these days you cannot simply build shopping centers everywhere you are able to. You need to be much more selective, do much more research and try to establish the exact specifications in sqm for different units across different market segments as well as remain more aware of the consolidation among retailers and the online retailing power. This makes operating on the market tougher than in the past. For the greenfield developments all you previously needed to do was to buy an agricultural land plot, rezone it and put a shopping center there, the opportunities are drying up. You can still find maybe 10 of such potential opportunities in Poland, and that is it.

But you still carry out greenfield projects jointly with your business partners…

Our first greenfield development in Poland was Galeria Solna in Inowrocław. It has been open for two years now and we can certainly call it a success. The project is 99.5 pct leased and we welcome more than 300,000 visitors to the centre every month. Its OCR (occupancy cost ratio) is around 11.5 pct, a very healthy result for this dominant center in a limited catchment ara. It is an example of taking an opportunity in the right time. There is no competition on the local market and the centre is attractively located. If these conditions are met, you can build a shopping centre on agreenfield location even today. Our next projects include Vivo! Stalowa Wola and VIVO! Krosno. Both centres, which are being developed jointly with Immofinanz, are being created close to where the people actually live. However, the pipeline for these kinds of schemes is set to dry up in five years times. By that time we need to be well established in other segments of the property market.

What exactly do you have in mind?

We are experimenting with some brownfield projects. We buy old factories in order to redevelop them. I think these kinds of projects have a future. For instance, our Tomaszów Mazowiecki project, Galeria Tomaszów, is situated in the perfect location – in the middle of the town. Tomaszów Mazowiecki is not a big city, but it has no modern retail facility. Therefore we took the opportunity to build something needed on the site formerly taken by a textile factory. Construction is scheduled to start in two months, and the one-level scheme, which will be only 17,000 sqm big (downsized from a pre-crisis three layer old plan of over 35,000 sqm GLA), is enjoying tremendous tenants’ interest, reflecting our belief that brownfield developments can still be quite successful. Another direction for us is to redevelop existing shopping centers. The two projects that we did with CBRE Global Investors, Sarni Stok Bielsko-Biała and Ogrody in Elbląg, show how we approach redevelopments. The 3,000 sqm extension of Sarni Stok was a relatively small project. But in the Ogrody case, we transformed the 17,000 sqm GLA one level scheme in a completely new five-level 40,000 sqm shopping centre experience.. We act in this case as the project’s fee-based development manager, without equity at stake, which is something we tend to do as well in case the development partner prefers full ownership. In Poland there are over 100 shopping centers that should be refurbished, redeveloped, extended or remodeled. This is all a very labor-intensive process. You must choose the right model individually for every single property and the local market. The hardest thing is to convince the owners that they need to change something in order to stay in line with the changing market offer and standards. And when an investor understands the need but doesn’t want to pour extra money into the project our job is also to bring money to the project. Convincing the city, the community and the immediate neighbors to support a redevelopment is another time consuming, sensitive process, for which we are very well positioned.

Can we expect to see you settling any new transactions in the near future?

We are working on a number of new acquisitions. We always try to work with reputable international and domestic investors like Dariusz Miłek and his Libra Project, CBRE Global Investors, Immofinanz and Rockcastle. Our role is to find new joint venture opportunities for these kind of partners. Our share in a project typically varies between 10-20 pct. When we find a potential development, we do market research, analyze its environment and prepare a feasibility, talk to tenants, City authorities, etc. . We sometimes decide to drop a project after a few months of thorough analysis. This is an enormous part of our work, obviously largely remaining unexposed. Two, maybe three, out of the ten projects we examine see some continuation. The market is now in that sense more mature and disciplined. The wild days on the Polish retail market are over. Developers start to listen to the tenants and rely on market research, which is all a very healthy sign. Unprofessional parties fade away, to the benefit of all.

Why did you drop the projects in Biała Podlaska and Białystok?

We concluded an initial purchase agreement for a plot in Biała Podlaska, which was set to serve an Agata Meble store and a retail scheme. We believe the city is ready for such a large scheme, but much to our regret we could not convince our investors to incorporate the large demand from Belarussian customers in the future turnover assumptions. In Bialystok the competition between retail schemes is quite intensive and the plot we analyzed, close the central station, is much better positioned for a mixed scheme, with limited supporting retail. Such schemes are not our main focus.

What locations are you most interested in?

We always operate in cities and towns with 50,000 to 100,000 residents. The catchment area should amount to between 200,000 and 350,000 people. This leaves us with mid-scale assets. Currently there are app. ten project opportunities in Poland left in this segment. And we hope to develop two or three out of them. The entire retail development industry realizes that in a couple of years from now we won’t be developing any new projects, but concentrate on redevelopments instead.

How much money have you invested in Poland so far?

Well, we are a private company and we don’t disclose such details. Jointly with our partners we have however published our stakes in Galeria Solna, Vivo! Stalowa Wola, Vivo! Krosno, Galeria Tomaszów, Galeria Wołomin investment projects, of 10 to 20 percent in each of them. The investment volumes for each asset reach app. EUR 40 mln on average, with banks financing taking ca. two thirds of the investments. We see our returns when we exit the projects, but we haven’t sold off any of them so far.

Maybe in the future?

It seems to be a good time for considering the sale of a shopping center. The investment appetite for the areas where we operate is growing. We expect to sell our first Polish shopping center, in Inowrocław, within the next twelve months. It will of course depend on the offers we are currently analyzing and our partners’ stance.

You only develop joint projects. Why do work this way?

It is rooted in our background and history. We all come from big companies like Ahold Real Estate, Multi Development, TK Development, and we used to developed big schemes of 20,000 sqm to 100,000 sqm. When we started our own company we wanted to keep carrying out projects of similar size, but we didn't have enough equity. Therefore we tried to identify partners interested in the joint venture approach. We now cooperate with market leaders which are not only capital strong but also have vast experience in retail and we are proud they have selected us as their partner.

Any new projects in the pipeline?

Apart from the two we talked about - in Tomaszów and Wołomin - we are in an acquisition process that will take another three months. Our retail focus will subsequently shift towards redvelopments. We furthermore have a new idea involving the Warsaw residential market. It is not about houses for sale, but about blocks of flats for the rental market. This segment may also grow in the future, even though the owner-occupier segment is the strongest, going forward.. We started to work with new investors from Holland and they asked us to have a closer look at the Polish residential market. In the next six months we will continue to search for investment opportunities and by mid next year we should make our ultimate decision on whether to invest in that market or not.

What about other CEE countries?

We have been examining investment opportunities in Belarus for some time. Although the local political situation oftentimes scares away investors in the country, we continue our market research. We are now discussing potential business models with Belarusian entities. The biggest problem in Belarus today is that the lack of retailers. Also, the existing projects are too large and show substantial vacancies. The concept of designing flexible schemes, which can be properly phased once the market matures does not really exist yet. But the situation will hopefully improve at some point.

Where do you see your company in the next ten years?

It is a good question. Now we work with a two to five year long time span in mind as the market changes quite dynamically. We will definitely lean towards the residential market and the asset management services. In the future I would like us to co-own the majority of our assets even if as a developer we normally should sell them. Maybe we will redevelop some of our schemes. Our asset management team is active in Galeria Solna and we would like to expand the services to other projects. There are some new investors on the market who don’t have their platform here and look for people to represent them locally in the long term. This sort of activities creates a lower income, but it gives more stability. The combination of selective (re-)development with asset management with some sort of parallel diversification towards residential for instance is on our mind and we will have to strike the balance between them.

Latest news

Office & mixed-use development

Czech Republic CTP opens Building I in Vlněna complex

schedule 13 September 2024
Opr./edited by ANZ

CTP opened its state-of-the-art office building I in Brno's Vlněna complex, which was created by revitalising a former brownfield site. The 60-metre-high building, designed by architectural Studio acht, boasts innovative technologies including a drone mail system.

Eurobuild CEE

Poland The September edition of ‘Eurobuild’ is here!

schedule 13 September 2024
Opr./edited by ANZ

The September ‘Eurobuild’ is now available in print and online - as always full of expert commentary and analysis, interesting topics and the latest news. Take a look!

Warehouse & industrial

Poland Highway to Hillwood

schedule 13 September 2024
Opr./edited by ANZ

Industrial Park Poland by Hillwood has gained access to the A2 motorway. Hillwood Poland has obtained an occupancy permit for the extended and upgraded access roads that connect the emerging industrial and logistics park to the motorway.

Investment & finance

Poland Citylink sells land in Łódź to DSV

schedule 12 September 2024
Opr./edited by ANZ

CL Property, a Polish developer specialising in multi-functional industrial and logistics space, has announced a transaction with DSV for the Citylink Łódź project. A new DSV logistics centre will be built on the 5.7-ha property located on ul. Zakładowa.

ESG

Poland Green is the standard

schedule 12 September 2024
Opr./edited by ANZ

Warsaw has adopted a green standard to make urban construction more energy efficient and environmentally friendly. The capital is the first city in Poland to implement such a solution.

Investment & finance

Poland Upturn in offices and retail sector

schedule 12 September 2024
Opr./edited by ANZ

According to JLL, the Polish investment market saw a significant increase in activity in H1 2024. Despite continuing challenges related to the cost of capital, a return of large transactions was recorded, suggesting a potential end to the slowdown phase.

Technology

Poland Velis has a new name

schedule 12 September 2024
Opr./edited by ANZ

Velis Real Estate Tech is officially changing its name to Singu, adopting the title of its property management product. The rebranding aims to both refresh the company's image and unify its operations. Velis Real Estate Tech will remain the company's administrative name.

Residential

Poland AFI Home conquers Wrocław

schedule 11 September 2024
Opr./edited by ANZ

The AFI Home platform is making its debut in a third Polish city. The development on ul. Długa in Wrocław offers 232 furnished flats.

Warehouse & industrial

Poland Industrial Poland is going strong

schedule 11 September 2024
Opr./edited by JC

The Polish industrial and logistics market continues its strong growth momentum, reveals BNP Paribas Real Estate Poland in its latest report “At A Glance – Industrial and Logistics Market in Poland” for the Q2 of 2024.

Office & mixed-use development

Poland The French on The Bridge

schedule 11 September 2024
Opr./edited by JC

The French Institute has decided to change its Warsaw headquarters in September 2026. It has chosen the historical building of the former Bellona Publishing House, currently undergoing modernization as part of The Bridge.

Investment & finance

Poland Greykite debuts in Poland

schedule 11 September 2024
Opr./edited by JC

European Real Estate Fund has commenced its deployment programme with the acquisition of a logistics portfolio in Poland. Three multi-tenanted properties will form the initial investment in a EUR 300 million joint venture with White Star Real Estate.

Warehouse & industrial

Europe Panattoni offers its BTS services in the Baltic states

schedule 10 September 2024
Opr./edited by ANZ

Panattoni is planning to extend its operations to all three Baltic states but is to concentrate particularly on Lithuania. As part of the new strategy the company intends to unify its cross border services, which will allow its clients to take advantage of BTS solutions both in Poland and the Baltic states.

Office & mixed-use development

Poland IBC is getting healthy

schedule 10 September 2024
Opr./edited by JC

Siemens Healthineers has expanded its cooperation regarding office space lease with Deka Immobilien, the owner of the International Business Center complex in Warsaw.

Warehouse & industrial

Poland Cosmetics brand chooses MDC2 Park Łódź South

schedule 10 September 2024
Opr./edited by ANZ

MDC2 and Fortress Real Estate Investments have finalised the lease of around 25,000 sqm within MDC2 Park Łódź South. The tenant, Oriflame Holding, owner of the Oriflame cosmetics brand, will start operations at the new location in Q1 2025.

Retail & leisure

Poland Another Smart Park has been sold

schedule 09 September 2024
Opr./edited by JC

Newgate Investment has acquired a completed retail park in Zgorzelec with over 5,400 sqm GLA. The seller was Smart Park Poland.

Infrastructure

Poland Beyond.pl expands its colocation project for AI

schedule 06 September 2024
Opr./edited by ANZ

Beyond.pl, a data centre, cloud, and managed services provider and owner of data centres in Poland, is expanding its colocation project for AI, machine learning, and high-performance computing solutions launched in January this year. The company announced that it is working to increase the target capacity of its campus in Poznań by almost 2 times.

Public buildings

Poland Palm changes ownership

schedule 06 September 2024
Opr./edited by ANZ

The most famous palm tree in Poland will be owned by the Museum of Modern Art. One of Warsaw's best-loved art installations will soon undergo a major overhaul.

Warehouse & industrial

Europe Top destinations for industrial nearshore supply chains

schedule 06 September 2024
Opr./edited by ANZ

According to the 2024 Savills Nearshoring Index study, the Czech Republic is the second most attractive location for industrial occupiers looking to ‘nearshore’ supply chains. Portugal ranks first, Poland in third place, Sweden being fourth, and Japan rounding out the top five.

Residential

Poland Port Praski development concept

schedule 06 September 2024
Opr./edited by ANZ

Preparations are underway for the expansion of the Port Praski project. A housing estate and an attractive public space are planned along the quays of the former Warsaw port. The project will be evaluated by local residents as part of a dialogue about the investment.

Office & mixed-use development

Romania A considerable new demand rebound

schedule 05 September 2024
Opr./edited by ANZ

According to data from the Cushman & Wakefield Echinox, the net office take-up in Bucharest across Q2 exceeded the renewal and renegociation transactional volume for the first time during the last two years, with a positive impact on the average vacancy rate, given that no new office projects were delivered in H1.

Latest in Retail & leisure

schedule 09 September 2024

Another Smart Park has been sold

Newgate Investment has acquired a completed retail park in Zgorzelec with over 5,400 sqm GLA. The seller was Smart Park Poland.

schedule 05 September 2024

One Gallery, one museum

One United Properties is carrying out restoration works on the former Ford Hall in Bucharest, which will be modernized into a mixed-use space. In addition to offices and a food market concept, One Gallery will feature a museum area, as well as a multifunctional hall.

schedule 04 September 2024

Giant welcomes first guests

San Park Piaseczno, a retail park developed by Ed San III Sancak, has been officially opened. The complex offers a total of more than 40 shops and service outlets.

schedule 29 August 2024

Shopping centres fuell the development activity

According to data from the Cushman & Wakefield Echinox, retail projects totalling more than 87,000 sqm were delivered throughout H1 2024, corresponding to a sharp increase when compared with the 30,000 sqm new supply from the same period of 2023. This year’s evolution was mainly fuelled by Q2 completions.

schedule 27 August 2024

San Park Piaseczno is ready 

San Park Piaseczno, the largest retail park currently under construction in the Mazovia voivodship, will open on 4 September. The retail park, offering a total of nearly 40 shops of brands from many sectors, was fully commercialised a few weeks before the opening.

schedule 23 August 2024

Big Gorzów with first thousands of customers

The Big Gorzów retail park opened a month ahead of schedule. The park was built on an 8 ha site in the north-eastern part of Gorzów Wielkopolski. It will serve 160,000 buyers from the city and the region. On the day of the opening, around 10,000 visitors had visited by 2 pm.

schedule 08 August 2024

Promising environment for luxury retailers

According to Colliers "Luxury Retail Brands in CEE-6” report, key factors attracting luxury brands to Central and Eastern Europe include local wealth,  the growing desire among customers for a Western standard of living,  and the potential of cities to attract large numbers of tourists and visitors.

schedule 08 August 2024

Five parks in five years

Mitiska REIM has announced on behalf of the Merep 3 fund a joint venture partnership with Park Lane Developments to develop retail parks in Bulgaria. 

schedule 24 July 2024

Record-breaking Q1 2024 sees arrival of 20 new brands

Twenty brands debuted on the Czech retail market between January and the end of June, the highest ever recorded in the first six months of a year. The biggest categories were Health and Beauty and F&B. All but one of the new brands opened in Prague, the other setting up shop in an outlet centre in the Moravian town of Hatě.

schedule 16 July 2024

Polish retail market continues its strong momentum

Cushman & Wakefield has summarised the situation on the Polish retail market in Q2 2024. There were eight new retail completions with the development pipeline comprising app. 400,000 sqm. This indicates healthy supply levels amid unwavering occupier demand and strong retail sales, shopping centre footfall and turnover figures.

schedule 10 July 2024

Food market to open at One Gallery

One United Properties announced the lease of a retail space with a GLA of 3,600 sqm on the ground floor of One Gallery building, including terraces and storage spaces. The contract has been signed with Tomcat Hospitality.

schedule 02 July 2024

The shopping basket analyzed in Romania

Romanians spent EUR 36 bln in large retail chains, an amount 11 pct higher compared with 2022, out of which the FMCG spending accounted for EUR 22.5 bln (more than 60 pct share), according to the Romania Retail Snapshot 2024 performed by the Cushman & Wakefield Echinox, based on the financial results of 116 companies from 12 different retail segments.

schedule 27 June 2024

A positive momentum for the film market

Romanians spent EUR 63 mln in cinemas last year, an amount 25 pct higher compared with 2022, as ticket prices also recorded a 8.2 pct y-o-y increase, according to the data offered by the Romanian Film Center and analyzed by the Cushman & Wakefield Echinox.

schedule 25 June 2024

New luxury destination in Bucharest

CBRE Romania has announced its exclusive involvement in the leasing strategy of H Știrbei Palace, a historical monument located in the heart of Bucharest. After the completion of the renovation works, Știrbei Palace aims to become a landmark shopping gallery for luxury brands in South-Eastern Europe.

schedule 25 June 2024

Karuzela in Jastrzębie Zdrój

Mitiska REIM has announced the opening of a new retail park in Jastrzębie Zdrój, a city of 90,000 inhabitants in southern Poland. Developed in partnership with Karuzela Holding and owned in joint-venture with the FRI 2 fund, this latest opening is the third retail park development opened in Poland by Mitiska REIM and Karuzela Holding in the past nine months.

schedule 13 June 2024

Froo Froo! Żabka Group starts operations in Romania

The Żabka Group has opened its first shops in Romania. Over the past month, five outlets under the Froo banner have opened in Bucharest.

schedule 10 June 2024

Ready for any event

Norblin Factory has a new event space. The Event Hall is a 670 sqm area outfitted in an industrial style, designed for events up to 500 guests.

schedule 06 June 2024

Another Leroy in Romania

Leroy Merlin has leased a 9,000 sqm of space within Pitesti Shopping Park, developed by Square 7 Properties. The logistics park, with a leasable area of 22,000 sqm, is located in the northern part of Pitesti, in the Gavana area.

schedule 24 May 2024

The one and only Answear Concept Store

In Warsaw's Norblin Factory, the only stationary Answear.com concept store in Europe started its activity. On the area of 2,000 sqm, the customers will find an offer of premium fashion brands, which so far were available only online.

schedule 07 May 2024

Empik flagship store in the city centre

The Cepelia pavilion at the junction of Al. Jerozolimskie and ul. Marszałkowska in Warsaw is undergoing renovation. A three-storey Empik store with a total area of 1,300 sqm will open in the building.

Edition 9 (291) September 2024

Latest comments

Categories