A combination of higher property yields and positive economic prospects has turned Poland into an investor darling and fuelled construction activity across the country’s major markets.
A combination of higher property yields and positive economic prospects has turned Poland into an investor darling and fuelled construction activity across the country’s major markets.
In total, more than 1 million m2 of offices is currently under development, of which roughly half is concentrated in the capital Warsaw. Construction is mainly occupier-led and vacancies remain at a healthy level below 10%, said Hadley Dean, managing partner for Eastern Europe at Colliers. In the retail sector, a total of 18 new schemes are under development.
‘We have already seen two yield compressions in Poland, one in 2004-2007, and the other in 2010 and 2011. The market is now expected to stabilise, while rents are forecast to rise gradually,’ he added. ‘Poland has a very compelling rental growth story, with landlords slowly gaining a stronger negotiating position.’
Growth in the retail sector is being accompanied by development of the country’s infrastructure. EU-funded projects are creating new logistics corridors and are expected to completely change the distribution patterns in the country over the next few years.
‘Poland has become a key location for the distribution of western goods into the expanding economies of Eastern Europe,’ said Charles Hazen, president and CEO of Hines Global REIT. The firm has just acquired a two-building logistics facility in Sosnowiec, a town in the Upper Silesia area. It is the fifth logistics park asset in Poland that Hines Global REIT has purchased from Prologis European Holdings.
Hazen: ‘We are bullish on Poland because it has growth characteristics similar to many emerging markets, yet benefits from European Union integration.’
The full article is published in the November issue of PropertyEU. Please click on the link below to subscribe
