The BPCC’s Real Estate & Construction Policy Group met on 25 October to discuss the potential of the private rental sector (PRS) in Poland, which is attracting much interest among investors. Speakers outlined the current scale of the sector, the legal and tax aspects of investing in it as well as presenting a case study from the largest investor in this market in Poland. The event was held at the offices of law firm Osborne Clarke and MDDP.
As is the case across countries in Central and Eastern Europe, most Poles have wanted to live in properties that they own – but this is changing. A young generation entering the labour market feels less of a desire to tie themselves to the long-term commitment of a mortgage, and feel the need to remain mobile, with a career that could see them working in multiple cities – countries even.
The answer to this need is a high-quality dwelling unit, built to rent by an institutional investor – a step beyond students’ halls of residence, something like a hotel for three to five years, close to their workplace, offering a rich social life in an attractively landscaped environment. At present, there are only around 8,000 such units in Poland, of which over 3,000 have been built by Resi4Rent, a developer whose main investors are Echo Investment and Griffin Capital Partners.
After an introduction and overview from Michael Dembinski, the BPCC’s chief advisor, Konrad Płochocki, the director-general of PZFD, the Polish developers’ association gave an outline of the PRS in Poland and the main challenges it faces, in particular economic problems caused by inflation as it affects the price of construction materials and labour. Fiscal considerations of investing in PRS were presented by Justyna Bauta-Szostak, head of the real-estate team at MDDP, while Agata Demuth, head of Osborne Clarke’s real-estate practice covered the legal aspects. Alicja Kościesza, sales and marketing director of Resi4Rent, Poland’s first apartments-for-rent platform, explained how it works and the firm’s plans for further expansion.
The four speakers were joined in a panel discussion by Łukasz Białecki, director of Bank Pekao S.A.’s commercial real-estate finance office. He talked about the current state of the mortgage market, which is making it much harder for first-time buyers to take out a home loan, and the specifics of investing in PRS projects. The panel, moderated by Michael Dembinski, considered the social issues surrounding the rise of the sector from a very low base, and how it would affect the labour market and urban development, as well as potential demand- and supply-side problems in the current economic situation. The concept of ‘accommodation-as-a-service’ fits in with other new models such as ‘mobility-as-a-service’ that is slowly encroaching on car ownership, said Mr Dembinski. There were also many interesting questions and comments from the floor, including ones about town planning and prospects for re-purposing office and retail space for rented accommodation, and how remote working would boost the growth of PRS in Poland.