PL

Poland Wrocław offices for Austrian investor

Investment & finance
Vienna,-based United Benefits Holding has entered the Polish market with the acquisition of the Silver Forum office building in Wroclaw. In an exclusive interview, Michael Klement, the CEO of the company, tells ‘Eurobuild’ about the company's plans for Poland and discusses the state of the investment market during the present crisis.

Magdalena Rachwald, ‘Eurobuild CEE’: Can you tell us more about the transaction? Why Wrocław and why this project?

Michael Klement, CEO and partner, United Benefits Holding: We acquired Silver Forum in Wroclaw at the end of last year and it took us nearly a full year to complete the transaction. Stepping into the Polish market was very important for us. We can’t disclose the value of the transaction as it’s confidential between the buyer and the seller. We were analysing the seven major Polish cities. Wroclaw is very well known and perfect for us, a lovely and well located city with a perfect size. And then we came to analyze the location of the project, which is the most important issue for us in real estate. And the location is amazing. It’s well connected to the city centre and has an unique stand alone location.

Silver Forum was built in 2007. What are your plans for the building?

A project of a certain age usually means that it needs further investment, so our plan is to invest in the facility on basis of sustainability aspects, and add some new flavour to it in terms of architectural upgrade and repositioning. We will also set up an ESG strategy and aim for building certification “in use”. In terms of leasing we will attract new tenants from the market looking also into start up hubs and business parks.

Wrocław is a starting point for your activity in Poland. What is your strategy?

In entering Poland, we aim to acquire more than one asset, of course. At the moment we are observing the market, trying to get the feeling of it. The investment market seems to be stable, despite all the current circumstances. We’re trying to find the right product for us. We have two models of activity – one is to acquire existing value-add projects and attract new tenants including additional investment, and the other is to observe the market and select class office buildings in the core segment for institutional clients.

Are you only going to focus on regional cities, or are you also considering investing in Warsaw?

I would say both. Warsaw is very interesting, I would say it is absolutely our number one focus. We are also carrying out research in Wrocław, Poznań, Kraków and Katowice. And I'm also interested in the Tricity, but I haven’t been there for several years. To put it simply, we’re analyzing all the markets.

Do you consider other countries in the region?

Our main markets are Austria and Germany, but our biggest project so far was located in the Netherlands, in Amsterdam. So we do also invest outside the DACH region. What counts is the size of the market. There are currently around 40 mln people in Poland, while the unemployment rate is around 3 pct. Besides Warsaw, you’ve got six other strong and big cities, so Poland was always going to be my favorite choice.

Will you operate in Poland in cooperation with local partners or will you establish a Polish team here?

We have a team completely dedicated just to Poland – people with a very long track record on the Polish market. At the moment we’re cooperating with local partners, but if we acquire a few new projects, we would definitely establish a local asset management team. For us, the key thing is being on-site. You need to be present, managing the assets, staying in contact with tenants.

United Benefits Holding was established in 2020, during the pandemic. Since then, the situation has become even more complicated, due to such factors as the war in Ukraine. Is this really a good time to invest in the real estate market?

We have a saying in our company, which is “never miss out on a good crisis”. You can keep a good business ongoing when you find and establish proper market products during a crisis. The problem now is in keeping a focus on Poland – with the high inflation and the sharp hikes in interest rates. And financing is getting much more expensive. Anyway, I do believe that Poland is a very good bet for real estate investment at the moment. When you are prepared to stay and manage the asset on-site, and you have a clear business plan for the next ten years, the timing is definitely excellent for creating significant additional value.

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