Poland: A Safe Address For Investors

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Nowadays, there is a strong global trend of investing in real estates. We are talking with Michał Styś, Managing Director of OPG Property Professionals, about the results for the previous year and whether 2018 is actually a good year to invest in profitable real estates.
Michał Styś, Managing Director, OPG Property Professionals
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What can you tell us about the previous year due to transaction and investment activity in the real estate sector?

The previous year was definitely very intense. If it did not end with a record-breaking value of transactions, it was certainly very close to this achievement. The estimated figure for 2017 amounts to approximately 5 billion euro, nearly half a billion more in comparison to 2016. According to preliminary analyses, the total sales volume of plots could amount to over 1.2 billion euro. Nowadays, there is a growing demand for new areas mainly due to such industries as BPO, SSC and IT. This trend does not only concern Warsaw. The real estate sector is developing and stratifying really fast which increases the role of regional markets and allows for further diversification of the investment portfolios.

Can we say that the Polish investment sector in 2017 augurs well for the future?

In the medium-term context, we are currently recording the highest increase since the time of the global economic crisis. It has turned out to be so significant that the FTSE Russell index agency classified Poland as a developed market last autumn. The progressing changes in perceiving our country by the foreign capital constitute a great challenge as well as growing expectations among the participants of the market. As an effective team of experts in the field of real estates and design management, we eagerly support investors in meeting those expectations.

What is the Polish market in the context of real estates? What is its potential?

Poland is still on the leading position when it comes to the markets of Central and Eastern Europe. Due to profitability of investing in real estates, our position against the western part of the continent is very prospective. The best assets purchased in Warsaw offer the return rate at the level of approximately 5-7%. This is nearly twice as much as, for instance, in Munich. We are the fifth economy of the Community and the third choice in the world due to location of outsourcing centers. At the same time, we have a low indicator value against other developed markets, which constitutes an additional spur for investors. In general terms, we are a safe address with an attractive relation of necessary outlays to potential profits.

What types of investors are attracted by Poland?

Poland definitely more frequently attracts institutional investors these days. As our country has joined the group of developed markets, it has an access to the new segment of investors, for whom the economic risk of a given country is of greatest importance. If our country provides safety as well as several “extra” percentage points, we stand a chance to attract a completely new capital. This is a comfortable situation because we are also classified as a developing country by the MSCI index agency which should partially allow us to maintain the popularity of the existing investors. It is also worth emphasizing the growing importance of regional markets. Krakow has already exceeded 1 million sq. m of office space, and Wroclaw will soon achieve the same number. This is something more than just a symbolic threshold. For many investors, for instance, German funds, such considerable size of commercial space is a technical condition necessary for making a decision on investing in a given market.

 

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