Why invest in Poland?

Cushman & Wakefield and Vastint also contributed to the report. A survey was conducted of key decision makers of companies operating in Poland. The eight main factors the report examines include infrastructure, the labour market, education, the standard of living and the how business friendly the local authorities are. Those surveyed were asked to rate the quality of the business environment in their cities on a scale of 1 to 10. The report also includes market data on living costs, office rents and salaries, which was collected and collated by Antal, Cushman & Wakefield, Vastint, ABSL, the Central Statistical Office of Poland and the National Bank of Poland.

“The business environment has a big effect on company growth. Factors such as infrastructure and office space directly affect financial performance, while the availability of human capital, the level of competition, innovation and products are of no less importance. All of the above factors have come together to create a new investment environment, which we have outlined in our 8-part series of reports on future investment in Polish cities,” says Artur Skiba, the chairman of Antal and the vice-president of the Association of Employment Agencies.

Real Estate

Two major strengths of Polish real estate are its unconventional office space and its attractive pricing. In examining how attractive Polish real estate is the following factors were examined: transportation, the quality of the space, its availability, the additional amenities in a building or its immediate vicinity and the office space attractiveness. Depending on the type of investment you are planning, it is advisable to choose the city that scored highest in those categories that you personally consider important. Some organisations prefer low rents, whereas others are willing to pay more for creative interior designs. The cities that were ranked highest for their real estate (with scores out of ten) are : Lublin (8) the Tri-City (4) and Kraków (2)

“Lublin has once again proven its status as one of the most investor-friendly cities in Poland. Lublin is a great choice for companies that wish to lower their operating costs as it is approximately 20 -30 pct cheaper to do business there than in Central or Western Poland. Yet, potential investors usually expect more than just being able to operate on the cheap. The Business environment, the office space quality and the availability of amenities that improve the quality of life are all considered important and I am happy to say that Lublin delivers in all of these areas,” said Agnieszka Gułaś, a negotiator at Cushman & Wakefield.

Investors want to find the best offices at the lowest possible price so value for money is important. Monthly office rents in Poland’s regional cities range from EUR 13.3 per sqm in Szczecin, to EUR 14.75 per sqm in Wrocław, which compares to Warsaw where they even go up to EUR 23.75 per sqm.

“The future looks bright for the office market. The total supply of office space in Warsaw and Poland's regional cities is estimated to be 10 mln sqm, making Poland the CEE leader and one of Europe's fastest-growing markets. It is worth pointing out that demand for offices in leading regional cities is growing, mainly due to the ongoing expansion of business service companies. The BPO, SSC, IT and R&D industry generated almost 60 pct of last year's demand for office space in regional markets and 30 pct of the total demand,” explained Radosław Kostka, the acquisition manager, Vastint Polska.

Infrastructure

Poland is rapidly developing its infrastructure, including its roads, railways, airports and seaports and investors have taken note. Some cities stand out, such as the Tri-City with its direct access to Poland's biggest seaport, which is a major advantage that sets it apart from the country's other big cities. Others, like Warsaw, are well-connected within the country’s infrastructure. Despite not being one of Poland’s top three cities, Łódź scored the highest for its international road connections (8.6 out of 10) and rail connections (7.9 out of 10). The cities which have the best infrastructure are the Tri-City (with 7.4 points), Kraków (with 7.2) and Poznań (with 7.1).

Business activity

Data collected by the National Bank of Poland proves that Poland is doing well as a place to do business with a 20 pct rise in FDI in 2018. Poland's competitive advantages include its highly skilled labour and large number of suppliers. The report includes an assessment of the level of competition on a scale of from 0 to 10. The leaders of the ‘Business Activity category were Wrocław (7.8), Warsaw (7.6) and Kraków (7.3).

Human capital

A region's labour market is determined by a number of factors. Potential investors look at the level of education in a region and the number of students studying each particular subject. Wrocław has numerous engineering students (17,600), while Poznań specialises in linguistics with over 25,200 students and Warsaw has the most computer science students (over 16,000).

For its education Kraków scored 8.6 out of 10, the Tri-City and Lublin – 7.9, while Warsaw and Wrocław scored 7.8.

Availability of qualified labour

Of all Polish cities Lublin has the largest pool of qualified workers of all Poland’s regional cities, which is largely due to the fact that its inhabitants are reluctant to move in search of work. One in five of the city's residents have changed jobs only once throughout their careers, and one in three have worked for the same company throughout their entire professional career. Unlike Warsaw, where the demand for skilled labour exceeds supply, Lublin has many qualified workers who are ready to start new jobs. Lublin scored highest with 7.4 out of 10, Warsaw came second with 7.2 and Kraków third with 7.0.

“The modern business services industry, one of the fastest-growing sectors in Poland, plays a very important part in the economies of Polish cities. This is why investors will often choose locations with an ample supply of employees with experience in the finance and IT industries as well as a with foreign language skills. Having access to the best talent in the country, Warsaw, Kraków and Wrocław are also home to almost 50 pct of Poland's shared services and outsourcing centres. The majority of workers employed in the industry live in those three cities,” says Karolina Korzeniewska, an account executive at Antal for the CEE.

Quality of life

Human capital is a crucial factor when choosing where to invest and as a result factors such as the cost of living, comfort and location are of increasing importance. Today, the recreation and shopping in a city also contribute to its business environment. The Tri-City is ranked as the city with the best quality of life and even scores higher than such cities as Lisbon, Paris and Rome in international rankings.

The study was conducted between 2017-2019 and was based on a sample of 588 decision-makers, including CEOs, board members and company directors in Poland.