Tadeusz MiroszPoland’s Real Estate Market - The only core in CEE?
GRI Club members gathered in Warsaw to discuss where value can be found for core real assets in and out of Poland.
October 11, 2018Real Estate
GRI Club members gathered in Warsaw on 2nd of October to discuss where value can be found for core real assets in and out of Poland. It was a special occasion to take some time out from everyday business activities and have a coffee with CEE’s leading investors and developers with a fantastic view from Zlota 44 tower over the city centre of Warsaw.
Moderated by Piotr Mirowski, valuable insights on medium and long term investment strategies were gained and debated.
Poland’s upgrade to developed market status – What does it mean for domestic and international investment appetite?
Members revelled in the recent news regarding Poland’s upgrade to ‘developed market’ status, indices run by FTSE Russell. Becoming one of the first countries in the world to be awarded such an upgrade in almost a decade, members felt that this change represents a fundamental shift in the perception of Poland among global investors. Some expressed the opinion that this reclassification is expected to spark the interest of new investors and open up exciting new opportunities.
What macro economical and political impacts might hinder real estate investment and development in Poland?
The room swapped their personal views and concerns about whether we were nearing the end of the cycle in European real estate, and what this would mean for the CEE market cycle. Could Eurozone economies with high debt levels (especially in a dollar trap) contribute to a micro economical crisis? What impacts would this directly have on Poland’s economy and overall real estate supply and demand? Even with such fears around global trade and values, the majority of participants believed that the worst case scenario would rather be a slowdown rather than a destructive downturn crisis, as Poland’s fundamentals would keep us on track. Poland is set to further benefit from increased market demand from the west and labour supply from the east.
Rents are expected to rise – So is it the right time to build, buy or sell?
Positive sentiments drew on the hopeful anticipation of a rental increase and an overall price adjustment strategy for the market. Many agreed that construction costs have increased, some developers gave examples of 15 % yoy increase; raising animated debate about whether we should be developing to risk an oversupply. However, many judged that the yield-rent-cost ratio will inevitably rebalance
Diversification might just be the best strategy – But out of core in Poland or out of Poland altogether?
In conclusion, whilst Poland was undoubtedly the king of the conversation in terms of its ability to bring long term stable income to portfolios, much of the discussions centred upon diversification and value add strategies outside of Poland. Contributing to such ‘out of Poland optimism’, was some thought around prices being shaken up, Europe wide; as investors wait on tenterhooks for a dollar shortage vs a brexit pound drop vs an asian goldrush into Europe’s emerging markets, most felt that it was presently important to diversify into alternative assets.
Among the participants were: Brian Patterson, Managing Partner, White Star Real Estate, Poland; Jaroslaw Wnuk, General Manager, Poland Bluehouse Capital, Poland; Karol Pilniewicz, Head of CEE, Cromwell Property Group, Poland; Czarek Jarzabek, Founder & CEO, Golub GetHouse, Poland; Christopher Zeuner, Head of Europe, Amstar, Poland; Robert Martin, Founding Partner, Head of Central Europe, Europa Capital, UK; Paul Betts, Managing Director CEE, M7 Real Estate, Czech Republic; Nebil Senman, Co-Managing Partner, Griffin Real Estate, Poland; Robert Dobrzycki, Chief Executive Officer Europe, Panattoni Europe, Poland; Marek Jakubiak, Director Head of Real Estate CEE, Deutsche Asset & Wealth Manage, Poland; Anna Duchnowska, Managing Director Poland, Invesco Real Estate, Poland; Michael Abel, Partner, TPG, UK; Krzysztof Kalicki, Chairman of the Board, Deutsche Bank Polska, Poland; and many more.
Moderated by Piotr Mirowski, valuable insights on medium and long term investment strategies were gained and debated.
Poland’s upgrade to developed market status – What does it mean for domestic and international investment appetite?
Members revelled in the recent news regarding Poland’s upgrade to ‘developed market’ status, indices run by FTSE Russell. Becoming one of the first countries in the world to be awarded such an upgrade in almost a decade, members felt that this change represents a fundamental shift in the perception of Poland among global investors. Some expressed the opinion that this reclassification is expected to spark the interest of new investors and open up exciting new opportunities.
What macro economical and political impacts might hinder real estate investment and development in Poland?
The room swapped their personal views and concerns about whether we were nearing the end of the cycle in European real estate, and what this would mean for the CEE market cycle. Could Eurozone economies with high debt levels (especially in a dollar trap) contribute to a micro economical crisis? What impacts would this directly have on Poland’s economy and overall real estate supply and demand? Even with such fears around global trade and values, the majority of participants believed that the worst case scenario would rather be a slowdown rather than a destructive downturn crisis, as Poland’s fundamentals would keep us on track. Poland is set to further benefit from increased market demand from the west and labour supply from the east.
Rents are expected to rise – So is it the right time to build, buy or sell?
Positive sentiments drew on the hopeful anticipation of a rental increase and an overall price adjustment strategy for the market. Many agreed that construction costs have increased, some developers gave examples of 15 % yoy increase; raising animated debate about whether we should be developing to risk an oversupply. However, many judged that the yield-rent-cost ratio will inevitably rebalance
Diversification might just be the best strategy – But out of core in Poland or out of Poland altogether?
In conclusion, whilst Poland was undoubtedly the king of the conversation in terms of its ability to bring long term stable income to portfolios, much of the discussions centred upon diversification and value add strategies outside of Poland. Contributing to such ‘out of Poland optimism’, was some thought around prices being shaken up, Europe wide; as investors wait on tenterhooks for a dollar shortage vs a brexit pound drop vs an asian goldrush into Europe’s emerging markets, most felt that it was presently important to diversify into alternative assets.
Among the participants were: Brian Patterson, Managing Partner, White Star Real Estate, Poland; Jaroslaw Wnuk, General Manager, Poland Bluehouse Capital, Poland; Karol Pilniewicz, Head of CEE, Cromwell Property Group, Poland; Czarek Jarzabek, Founder & CEO, Golub GetHouse, Poland; Christopher Zeuner, Head of Europe, Amstar, Poland; Robert Martin, Founding Partner, Head of Central Europe, Europa Capital, UK; Paul Betts, Managing Director CEE, M7 Real Estate, Czech Republic; Nebil Senman, Co-Managing Partner, Griffin Real Estate, Poland; Robert Dobrzycki, Chief Executive Officer Europe, Panattoni Europe, Poland; Marek Jakubiak, Director Head of Real Estate CEE, Deutsche Asset & Wealth Manage, Poland; Anna Duchnowska, Managing Director Poland, Invesco Real Estate, Poland; Michael Abel, Partner, TPG, UK; Krzysztof Kalicki, Chairman of the Board, Deutsche Bank Polska, Poland; and many more.