Eastern Europe Property

Poland, as the largest of the 10 new Countries that joined the EU in 2004, stands out as offering significant growth opportunities for overseas property investors. A recent Channel 4 programme cited Poland as being one of the best places to make money from property investment in all of Europe!

EU membership removed the obstacles that previously prevented foreigners from purchasing property there. In addition, EU funding will generate significant impetus to the development of the economy, as Poland seeks to establish itself as one of the major players in the expanded EU.

Poland has focused on economic liberalisation and with membership of the EU, the key economic challenge now is to align the economy to the strict economic criteria for entry into the European Single Currency zone which may be feasible from around 2010. In the meantime, property prices are likely to be influenced by improving economic circumstances, the prospect of joining the Euro zone and increasing demand for quality housing in the major cities by the Poles and expatriates alike

Many cities such as Warsaw and Krakow have ambitious development plans to cope with the increased demand, particularly among the young population, for affordable but quality new build developments. With Warsaw’s population forecast to double by 2010, demand for such property is increasing and property prices in Warsaw have experienced significant growth over the past two years.

Many International Companies have been attracted to Warsaw by the educated workforce and lower overheads associated with running offices or Companies there. These Companies and the growing population are fuelling the need for quality residential accommodation. Demand for premium residential apartments is likely to remain high for the foreseeable future, providing significant opportunities for the investor interested in the buy-to-let market.

Some forecasts suggest that property prices may double in some areas of Warsaw over the next five years, and this coupled with the prospect of excellent rental returns make for an opportunity not to be missed for the overseas property investor.

Contact us for more information on how to invest in Poland’s property market

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The number of tourists who visited Poland soared in July and August, thanks to an advertising campaign which turned the negative symbol of cheap eastern European labour – the Polish plumber – into a blonde hunk carrying a monkey-wrench who beckons foreigners to visit his country.

“The campaign was well taken up around the world. It focussed the attention of lots of people on our country,” the Polish tourism board’s Krzysztof Turowski told reporters.

The symbol of the Polish plumber, representing cheap labour from new EU member states, was vilified earlier this year during national referendum campaigns on the EU constitution, which was rejected by French and Dutch voters.

But Poland’s tourism board cleverly turned this negative image into a positive when it launched a campaign at the start of the summer that used a seductive blonde man clutching pipes and a monkey-wrench, above the slogan, “I am staying in Poland — come on over.”

Thanks to the handsome, muscle-bound Polish plumber, the number of French tourists visiting Poland in July and August rose 14 percent compared with the same two months last year to 57,400.

“Our plumber even scored in Australia,” said Turowski. Fifty-six percent more Australians, or 10,200, visited Poland this summer than the previous year.

The numbers of Cypriots, whose country, like Poland, joined the EU in May last year, rose the most — by nearly 130 percent. Eight-hundred Cypriots visited Poland in July and August.

Other visitors who found the idea of coming to Poland particularly attractive were; Canadians – up 62 percent to 19,500 visitors in July and August, new EU nationals from Malta – up 59 percent, and British and Irish nationals – up 47 percent and 33 percent.

The number of summertime visitors from the United States rose nearly 25 percent to 95,100, while Japanese visitor numbers rose around 20 percent to 8,500.

Poland, as the largest of the 10 new Countries that joined the EU in 2004, stands out as offering significant growth opportunities for overseas property investors. A recent Channel 4 programme cited Poland as being one of the best places to make money from property investment in all of Europe!

EU membership removed the obstacles that previously prevented foreigners from purchasing property there. In addition, EU funding will generate significant impetus to the development of the economy, as Poland seeks to establish itself as one of the major players in the expanded EU.

Poland has focused on economic liberalisation and with membership of the EU, the key economic challenge now is to align the economy to the strict economic criteria for entry into the European Single Currency zone which may be feasible from around 2010. In the meantime, property prices are likely to be influenced by improving economic circumstances, the prospect of joining the Euro zone and increasing demand for quality housing in the major cities by the Poles and expatriates alike

Many cities such as Warsaw and Krakow have ambitious development plans to cope with the increased demand, particularly among the young population, for affordable but quality new build developments. With Warsaw’s population forecast to double by 2010, demand for such property is increasing and property prices in Warsaw have experienced significant growth over the past two years.

Many International Companies have been attracted to Warsaw by the educated workforce and lower overheads associated with running offices or Companies there. These Companies and the growing population are fuelling the need for quality residential accommodation. Demand for premium residential apartments is likely to remain high for the foreseeable future, providing significant opportunities for the investor interested in the buy-to-let market.

Some forecasts suggest that property prices may double in some areas of Warsaw over the next five years, and this coupled with the prospect of excellent rental returns make for an opportunity not to be missed for the overseas property investor.

King Sturge represented Dawnay Day International on the purchase of four shopping centres in Poland.

Dawnay Day Carpathian, the AIM-listed retail commercial property fund created to invest in central and eastern Europe, has purchased the shopping centres from a joint venture set up by Heitman and GE Capital. The transaction value was €64.5million reflecting a yield of 8%.

The four shopping centres are located in the Tulipan Centre in Lodz, Osowa in Gdansk, Kometa in Torun and Centrum Sosnowiec in Sosnowiec. The centres are anchored by Geant Hypermarkets and comprise 908,083 ft² (84,363 m²) of retail space.

05 October 2005

More finance for real estate in Poland

Aug. 9 2005

Press Release – European Bank for Reconstruction and Development

The EBRD is supporting the development of commercial properties across Poland with a PLN 49.5 million investment in the new BPH Property Fund. Other subscribers to the fund, which has a total value of PLN 330.6 million, include pension funds, insurance companies and retail investors. The fund expects to be listed on the Warsaw Stock Exchange later this year.

The fund is denominated in zloty, meaning it will be easier for domestic institutional and individual investors to invest in real estate. The fund will focus mainly on medium-sized commercial properties. Investments are likely to include office buildings, retail units, warehouses, business parks and outsourcing centres. Up to 30 per cent of the fund may also be invested in other central and east European countries.

BPH Property Fund was set up and is managed by BPH Towarzystwo Funduszy Investycyjnych, a Polish management company majority owned by Bank BPH S.A, Poland’s third largest bank in terms of assets. Bank BPH is majority owned by HVB Group.

Ilaria Benucci, EBRD Director for Property and Tourism, said the fund will provide domestic and international investors with the opportunity to invest in real estate in a market with growing demands. The EBRD’s participation should strengthen the development of market standards and has been highly welcomed by institutional investors.

As of March 2005, the EBRD had signed 140 projects in Poland, totalling €3.2 billion. An additional €7.9 billion has been mobilised. A total of 83 per cent of projects are in the private sector.