New investment opportunities in Poland

investment opportunities in Poland

Our experience of cooperating with the country on the Vistula

Recently, on the 5th of November of 2019, EXNOVO Performing Value had a pleasure to participate in the seminar about new investment opportunities in Poland organized by the Polish-Spanish Chamber of Commerce in cooperation with the Consulate General of the Republic of Poland in Barcelona, the Catalan Confederation of Employers Fomento del Trabajo Nacional, ACCIÓ, Santander Bank Polska and the Domański Zakrzewski Palinka law firm. We were especially intrigued by the topic of the seminar not only because of our interest in this country but also due to the fact that for the last 12 years we have been representing and advising Spanish real estate investors in Poland.

Based on our experience and the information acquired during the conference, we would like to present new investment opportunities in the Vistula country and explain why it is an attractive destination. During the last 12 years, we have observed an increasing interest of foreign investors in the real estate market and also other sectors such as infrastructure, transport and logistics. Without a doubt, Poland has become a significant and dynamically growing market in Central-Eastern Europe.

What makes Poland an attractive investment destination?

What personally attracted us to start cooperating with Poland is its rich history, abundant cultural and natural heritage. Already 12 years ago, we saw a potential dormant in this country and encouraged our clients to conquer this unexplored market. Driven by curiosity of exploring new business opportunities and lower than in other European cities costs, our clients started to implement their business vision undertaking ventures such as purchase and sale of properties in strategic Polish cities: Warsaw- the capital, Tri-City and also historic Cracow.
It has paid off.

Why is it worth invest in Poland?

As Dorota Szczesniak, a Head of International Factoring in Santander Bank, noted there are many reasons why international investors should establish commercial connections with Poland. Being a bridge between Russia or the Scandinavian countries, Poland offers a central, strategic location making it an attractive investment object for entrepreneurs targeting both Eastern and Western Europe. Its political and economic stability together with the population amounting to 38 million has also contributed to the fact that Poland is considered as the 6th economy of the European Union. Within 15 years of being its member, a country which for a long time suffered communist regime has significantly strengthened its position which can be reflected in the GDP which in 2018 reached 5.1%.

On the other hand, Juan Carlos Orozco, a financial director of Celsa Group pointed out that Poland attracts foreign investors also due to its qualified and productive but relatively inexpensive (comparing for example to Spain) human capital specialized in IT, modern technologies or engineering. It is an important factor especially for entrepreneurs who would like to invest their capital in people, not products, for example creating workplaces and start-ups. From our experience, we would like to add that its quite easy to establish business relationships in terms of communications as most people from the professional environment speak English. It’s not difficult to overcome language barriers. However, we agree with the observations made by Juan Carlos Orozco when it comes to impediments at the level of communication with restrictive administrative staff and rigid bureaucracy. Any investor should have in mind that administrative officials take all deadlines and formalities very seriously.

Real Estate Investment in Poland

As a real estate and hospitality consulting company we have been advising our clients interested in acquiring, selling or managing properties in Poland. The real-estate sector in Poland has been especially tempting for foreign investors which can be reflected in the amount of participation of foreign capital in this sector which estimates at around 90%. It is due to the low capital values for property which eventually brings profit as a result of price appreciation.

Not only is the price per square meter lower than in other European countries. Aside from the financial benefits, there are also some advantages for investors who are not interested in property purchase but would rather hold by lease. Lease agreements in Poland are much more flexible which gives investors more freedom and protection in terms of contract duration and fees. It also means that there are no restrictions and the process of property acquisition is equally achievable for the citizens of Poland as well as foreigners.

In addition, there is another property interest in land especially popular in Poland- the right of perpetual usufruct. The concept which originally arises from the reluctance of the officials to sell a property or land that belongs to the State Treasury and give full control to private ownership. Not that different from the standard ownership, the perpetual usufruct also allows to use and make income on the property and the right to it can be then either transferred or inherited. We mentioned this type of investment because for the last 3 years, we have been advising our clients on managing this type of property, acquiring all necessary building permits and performing renovation works. We do assure that it’s profitable.

Subsidies from the European Union and convenient connections

During the seminar, we also had a chance to hear a speech from Jose Luis VillaCampa from Domański Zakrzewski Palinka law firm who took us through the topic of legal protection and public subsidies for investments projects. As he said since 2007 Poland is one of the mains beneficent of the funds from the European Union. Only between 2014 and 2020 Poland will have obtained 82.5 billion euro which will be assigned to infrastructure, business development and IT. Real estate investors can count on numerous European funds, aids and tax reliefs from the Polish Investment Zone.

Also flying to Poland has become more convenient and affordable than ever. Malgorzata Wieteska, the Country Manager for Spain & Portugal of LOT Polish Airlines, highlighted that there are connections between Spain and Poland with daily flights to the most influential cities such as Warsaw, Cracow, Tricity or Wroclaw.

It is definitely another reason to choose Poland as an investment destination. Speaking from our own experience and on behalf of our clients, after 12 years of successful cooperation, we still believe that Poland has great development potential and many interesting investment opportunities.

If you are thinking of implementing your business vision in Poland, don’t hesitate to contact our team.

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