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RESEARCH & FORECAST REPORT | MID-YEAR 2012 | POLAND | LAND MARKET
Land Market
TRENDS 2012
OFFICE
GENERAL OVERVIEW
• In 2012 activity on the investment sites market is expected to remain stable,
SUPPLY
what is confirmed by the results of the first half-year.
DEMAND
• The volume of transactions is growing; however, it will not reach the value of
transactions recorded before the crisis. In years 2006-2007 transactions worth
PLN 1 billion were concluded on single regional markets.
PRICES
• Investors willingly buy land for office and residential development. On such
Source: Colliers International
investments they have released 85% of their funds, 10% of funds buyers
dedicated for retail investment sites and 5% for industrial investment sites.
• 80-85% of purchases of land under residential and office development takes
place in Warsaw.
TRENDS 2012
RETAIL
• Consistently areas well-prepared for the investment process in terms of
technical, legal and planning conditions are priced relatively higher. Good
location is another factor increasing the value.
SUPPLY
DEMAND
TRENDS
PRICES
• In case of retail investment sites, plots located in cities with more than 20,000
inhabitants are becoming increasingly popular. The land acquired in smaller
towns is intended for small retail parks.
Source: Colliers International
• Developers cannot afford freezing money, that is why they buy such plots, on
TRENDS 2012
RESIDENTIAL
SUPPLY
DEMAND
PRICES
Source: Colliers International
1 | COLLIERS INTERNATIONAL
which they can start with the investment process as soon as possible.
Nowadays the investments are planned short-term – they are expected to
begin and end within 5 years due to less stable situation on the market. If
there are any problems with the site that can be solved in a relatively short
time, a conditioned preliminary sales agreement is concluded.
• Despite high supply, demand for investment sites has not been fully met,
preliminary due to lack of sites meeting requirements of developers. The
unfavorable location or shape of the plot, which prevent effective management
of the property, are the main reasons why some of the sites are not subject to
sale.
• Investors search for markets where prices of flats, rents and appropriate
demand will guarantee the quickest return on the equity.
RESEARCH & FORECAST REPORT | MID-YEAR 2012 | POLAND | LAND MARKET
Land Market
PRICES AND TRANSACTIONS
SELECTED TRANSACTIONS
H1 2012
• Since the beginning of 2012 the value of transactions on the investment sites
market under office, retail and residential development reached circa PLN 800
million. This constitutes 60% of expenditures incurred in 2011, which
amounted in total to PLN 1.2-1.3 billion.
LOCATION
PLOT
SIZE
(ha)
PRICE
(PLN
mln)
Grzybowska
Warsaw
0.2
43
Confidential
Warsaw
7.0
70
Confidential
Warsaw
1.0
45
of land needed to build 1 m² of residential usable space in the first half of
2012 was lower than in 2011: by 25% in Kraków, by 23% in Poznań and Łódź.
The land for office development became cheaper in Katowice by 27% and in
Wrocław by 26%.
Confidential
Warsaw
2.3
14
• In comparison to 2011 the average transaction prices in the Capital City
INVESTOR
GetHouse
Golub
Source: Colliers International
PRICES FOR THE OFFICE
DEVELOPMENT SITES (€/m² of GLA)
CITY/REGION
MIN
MAX
• In most of the cities transaction prices are decreasing. Statistically, the price
declined respectively at least among the largest Polish cities. For investors
opting for an office investment site purchase, prices went down by 8% and
remained at a similar level for residential investment sites.
• Prices of retail development sites normalized and it seems that in the coming
months they will be rather stable, both for sites for shopping centres and retail
parks.
AVERAGE
FORECASTS
Warsaw:
City Centre
180
900
540
Kraków
150
320
235
170
135
300
225
transactions should be larger than last year.
Łódź
100
Source: Colliers International
Poznań
150
Upper Silesia
75
160
117.5
TriCity
100
300
200
Wrocław
100
350
225
Source: Colliers International
CITY/REGION
MIN
MAX
AVERAGE
Warsaw:
City Centre
300
800
550
Warsaw:
Uptown
140
380
260
Kraków
120
300
210
Łódź
70
180
125
Poznań
80
280
180
Upper Silesia
60
200
130
100
300
200
130
300
215
Wrocław
• In 2013 the investment sites market may slightly slow down compared with
2012, and undoubtedly this will happen in 2014.
• In the coming months we will observe a continued interest in land intended for
office development, especially in Warsaw and Wrocław, but also in Kraków
and the TriCity. The demand for residential land in major cities will be also
recorded, however mainly in Warsaw.
• As a result of new regulations (Developers Act) that became final and valid in
PRICES FOR THE RESIDENTIAL
DEVELOPMENT SITES (€/m² of PUM)
TriCity
• 2012 is a good time on the investment sites market. The volume of closed
Source: Colliers International
2 | COLLIERS INTERNATIONAL
April 2012, residential developers began the process of consolidation, as only
the largest and most financially stable companies will be able to meet the
requirements imposed by the legislator. As a result, some of the smaller
development companies may be offered for sale or will seek joint venture
opportunities in the market and new investment offers will appear on the
market.