By Dorota Lachowska, head of research at Knight Frank
pole-KnightFrank BP


Investments in commercial real estate in Poland slowed considerably in 2023. The total volume of investment transactions was slightly more than €2 billion and 60% lower than in the previous year. Last year, around 80 transactions were recorded, a decrease from nearly 130 in 2022. This translated into lower market liquidity.

Interest rates in the eurozone were not reduced during the first four meetings of the European Central Bank held this year. Credit costs are at the highest level since 2001. However, they are likely to be reduced due to a gradual decrease in inflation.

As a result of interest rate cuts forecast in the upcoming months of 2024, the inflow of institutional capital to Poland is expected to increase. If this scenario occurs, the number of ‘core’ transactions will increase and market sentiment will improve.

The investment market in Poland in Q1 2024 has remained limited in the main sectors. The volume invested in commercial real estate in Q1 2024 amounted to over €360 million and was the lowest quatrely value since 2015.

Warehousing premises were still the most popular types of premises among investors followed by office and retail schemes.  Investors in the BTR (Built to Rent) sector remain active thanks to which the share of this sector increased to the record 12%. For another consecutive quarter, we have also seen transactions in the hotel market, where two chain properties were traded thanks to which the sector’s share of the total volume amounted to 4%.

Warehouses and logistics facilities are still the most liquid sector of commercial real estate and have been popular among investors since the outbreak of the pandemic and structural changes on the market.  In Q1 2024, the warehousing sector, as last year, was the most popular one among investors. The share of warehousing facilities in the total volume was 38%, whereas the value of the capital invested therein was €138 million.

Stable results of this sector are related to strong demand for renting warehousing facilities and the rate of its growth. A slump in consumption resulting from an increase in inflation rates as well as a decrease in industrial production in 2023, which weakened the demand, do not affect investors’ long-term strategies.

In Q1 2024, a total of €107 million was invested in the Polish office market, constituting a 29% share in the total volume. Nearly all of the transactions involving office premises in the first three months of 2024 were concluded in Warsaw, which is a continuation in the trend observed in the previous year when the investors were also focused on the most mature market in Poland.

In the first quarter of 2024, as in 2023, no ‘prime’ transactions were recorded on the office market, while the investors focused on non-central locations. The limited activity of investors results from high interest rates, strict borrowing conditions and an uncertain macroeconomic environment. A recovery on the investment market in the office sector is expected in H2 2024.

The situation on the retail market in 2023 improved. Shopping malls footfall and their nominal turnover bounced back to the levels recorded before the pandemic. Despite the favourable situation on the market, the share of commercial real estate in the total volume decreased and accounted for 16% in Q1 2024 (an averaged share in 2023 was 20%). The total value of investments was as low as €60 million.

The retail market is still dominated by transactions involving small facilities, such as retail parks and small shopping malls aiming at satisfying local residents’ everyday needs. No ‘prime’ transactions have been recorded since 2022. 

Developers’ activity is also focused on small towns (under 100,000 inhabitants), the result of high saturation with commercial premises in the largest agglomerations, lack of appropriate land plots or their high prices, as well as high demand for small commercial facilities from the investment market.

In Q1 2024, two transactions in the BTR sector were recorded – the sale of Noli Mokotów and Siennicka 29a, which offer 280 and 120 apartments, respectively. The total capital invested amounted to €44 million, giving a high share of 12% in the total investment volume.

A record-high share of BTR facilities in the total volume indicates stable foundations of this market and its positive prospects for the future.

After a few years’ break, in Q4 2023 and Q1 2024, transactions involving chain hotels started to appear. In Q1, two Hampton by Hilton hotels in Gdańsk and Świnoujście were sold, as a result of which the share of this sector in the total volume constituted 4% and reached the highest level since 2019, which was a record-breaking year for the hotel market in Poland.

Referring to the Polish investment market in general, it is worth paying attention to the increased number of transactions involving Polish capital. This indicates an opportunity used by local companies, which taking advantage of the current situation on the market, are purchasing commercial real estate at attractive prices. Although these are low-volume transactions, related to small retail and office facilities, they indicate the local capital’s appetite for investments in commercial real estate, not only investments in apartments for rent, as it used to be the case before.

For further questions please contact:

Magdalena Michalak, PR & Marketing Director, +48 508 429 401,  

Iwona Mitros, PR & Marketing Manager, +48 507 218 966,  

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