International counselling company CBRE has presented an experts commentary concerning the investment land prices in Poland. Current number of land for real estate transactions is rising, but their level is still lower than in years 2005 – 2008. Property developers are highly interested in attractive lands adjusted to medium size constructions. Very big pieces of land sale only sometimes, as they demand significant funding. What changed in relation to years 2005 – 2008 are noticeable precautionary measures of the investors before the land purchase and a careful analysis of the possibility of construction on it.
When describing the attractiveness of the real estate, property developers consider its two primary assets: not only the value of one meter square of the land, but above all its value per one square meter of rentable or apartment space of the planned investment. The latter parameter is of key importance in the process of evaluation of property's investment – states Grzegorz Wożniakowski, Associate Director in CBRE price evaluation department and the author of experts commentary.
In office real estate sector city centres of places like Warsaw, Cracow or Wrocław are of highest interest. The biggest prices can be found in the centre of the capitol, being also the place where the highest rent rates are present.
Price differentiation between very good and average lands has become more noticeable than before the crisis. The best grounds, located in centres of big agglomerations, haven't changed their values and the prices of less attractive real estate decreased even by a half. The decrease in total construction costs during the last years is a positive tendency which can be connected with the increase in supply. However, a certain disadvantage still remains a difficulty in gaining financial support – the purchase of land usually has to be financed directly by the property developer as a possible loan covers only the construction costs.
At the same time we can notice an increase in demand for land caused by sales of real estate of major public institutions, such as Polish Railway or Polish Post Office, as well as the users of grounds running a low profitable companies on high quality grounds, which are unable to cover the bills for usage of the ground after their significant increase in 2011 and 2012 – says Grzegorz Wożniakowski.
Full version of expert's commentary in PDF file is implemented below.Download PDF