The private rented sector (PRS) is poised for growth and will go from zero to hero in Poland, delegates heard at Real Asset Media’s Outlook 2020 – Europe & CEE investment briefing, which was held at Colliers International’s Warsaw office earlier this month.
‘Renting is going to be a huge trend in the decade ahead,’ said Peter Noack, Co-Founder and Managing Director, Zeitgeist Asset Management. ‘In Poland, unlike Germany, there is a tradition of owning rather than renting, but it’s all changing now because of rising property prices. More and more people will be forced into renting, and there is a real lack of product’.
The demand is there, the financing is there, the companies are ready for this new phase in Polish real estate development.
‘Everyone is ready but the only thing missing is the product,’ said Piotr Mirowski, Senior Partner, Director, Head of Investment Services, Colliers International. ‘Clearly the demand is there, which means that the conveyor belt of new product has been set in motion’.
The sector will not mushroom overnight, he warned, because it is starting from a low base and much of the product will have to be built from scratch.
The same applies to student housing, another resi sector that has great potential in Poland.
‘We see a lot of interest for niche sectors like student housing,’ said Noack. ‘But while in Prague we just do refurbishment of existing assets, in Poland it is so difficult to find product that we are forced to become developers. We don’t want to be, but there is no alternative so our entire portfolio in Poland is developments simply because there is nothing to buy’.
Even companies that have focused on the office sector are now looking at resi alternatives.
‘We like the Polish market and we have been aggressively looking for opportunities,’ said Paul Hallam, Managing Partner, GalCap Europe. ‘We would like to focus more on residential, but so far we are waiting in line’.
Financing is available even from the traditionally cautious banks. ‘There are new products being developed for alternative asset classes,’ said Justyna Kedzierska-Klukowska, Head of Berlin Hyp Warsaw Office. ‘This is remarkable, because there is no track record for this market and no knowledge of how tenants’ behaviour will develop’.
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