Welcome, investment
Several years ago, a Warsaw analyst referred to the Tri-City real estate market as "shallow". As far as offices are concerned, the situation hasn't altered but when it comes to retail space, Tri-City is buzzing
In "Poland: The real state of the real estate" published by the Ernst & Young consultancy firm, it is stated that the total demand for office space in this part of northern Poland amounts to approximately 270,000 sqm. Compared to the smaller Poznań, with its total of 550,000 sqm, Kraków with 450,000 sqm or Wrocław with 500,000 sqm, Tri-City seems a small market indeed. Does it mean that developers should avoid investing in office buildings here, or that on the contrary, this market is open to new, attractive stock?
Cinema to office block
This seems to be the view of Portico Development, which along with the
experienced developer Apollo-Rida, has decided to build the Baltic Corporate
Centre right in the centre of Gdańsk, at the crossroads of ul. Rajska and ul.
Heweliusza. BCC is a class A building with 20,000 sqm of space available for
lease on six storeys. The designer, Andrzej Kapuscik, was selected in a contest
organized by SARP (the Association of Architects of the Polish Republic). The
building will be constructed for a specific tenant, so the work will commence as
soon one is found, and according to Robert Pawlak of Portico, this could still
be in the first half of this year. The construction permit is valid until the
end of 2003 and the work, the estimated cost of which is USD 20 mln, should
continue for no longer than 13 months. The plot was originally meant for a
multiplex cinema but the developer redefined the scheme when a similar project
began only a few dozen metres away.
Retail in the centre and outskirts
BCC's closest neighbour will be the Madison Park retail centre, to consist of
33,000 sqm total and 18,000 sqm of retail space, which is currently under
construction and whose investor is Hossa, a construction and development company.
There will be four stories above and one underground in this complex and it will
house over 100 retail units varying from 60 to 1,600 sqm. Two medical complexes,
offices, a recreation and sports' centre and a 114 car underground car park will
complete it. The building will open at the end of November.
Another retail centre, Manhattan, is being constructed in Wrzeszcz, Gdańsk's
shopping district. The investor is Gdańskie Centrum Handlowe and Hydrobudowa is
the general contractor. There will be total space of 55,000 sqm, 23,000 sqm of
which will be retail, accommodating approximately 120 shops and service units.
Światowe Centrum Handlu Bursztynem, Złotem i Diamentami (World's Amber and The
Gold and Diamond Trade Centre), who have leased around 3,000 sqm, will be among
the main tenants. The agents leasing the space are Lambert Smith Hampton and the
centre will be launched towards the end of this year.
Yet another retail centre, Alfa Centrum, with a total of 15,500 sqm of retail
space on five floors (a two-level underground car park, ground floor, retail and
services floor and a second floor with an 8-cinema KINOPLEX) was opened in the
residential Przymorze district in Autumn last year. The firm Centrum-A is behind
this PLN 124 mln investment.
In the next few years, The Outlet Company, part of Liebrecht & wooD, are
planning to build northern Poland's first factory outlet on a plot near the
Tri-City ring road. The construction permit was issued in March, and the Gdańsk
Outlet Centre will be home to shops selling end-of-line products, out of season
collections and faulty garments at discount prices. The architecture of GOC is
reminiscent of a fishing village and the total cost of the undertaking will
amount to USD 30 mln.
Shipyard of the future
The number of attractive investment areas is considerable, the most promising of
which are the 73 hectares of industrial plots owned by Synergia 99 in the city
centre. These sites, once owned by the shipping industry, are to become the
property of retail, office and residential developers. There are also plans for
a road which will facilitate easy communication around the three towns. Janusz
Lipinski, President of Synergia, maintains that there are already 27 projects in
the area ready to begin, three of which have attracted genuine interest but, as
he himself admits, "it will take many, many years to develop the whole area".
Trouble island
When journalists in Gdańsk run out of ideas there is always Wyspa Spichrzów (the
Granary Island), an almost 1 hectare plot smack in the city centre. The city
authorities have long searched for a suitable investor prepared to develop the
area, though all of the companies selected for the job have turned out to lack
competence and trustworthiness. In 1996, an American company, Genesis Hotels,
took over the land, and with the local authority, (which had an 8 per cent stake),
had plans to develop a hotel-residential complex, though nothing came of it
because the company had insufficient funds to carry out the investment. In 2002,
WSC Investment and Mennica Invest took over the company's shares. Janusz
Ciesielski of Mennica told us then that the investment would require PLN 130 to
150 mln, but the two firms seem not to have intended to invest in the island.
After a few months they borrowed a sum of PLN 10 mln from ComputerLand, the
guarantee for which was the mortgage of several plots on the island. At the end
of last year the area was burdened with a debt once more of USD 3.6 mln, this
time owed to Dresdner Bank. Last January, WSC and Mennica sold the most
attractive Gdańsk plot to Stołeczne Przedsiębiorstwo Handlu Wewnętrznego (the
Metropolitan Interior Trade Enterprise), a company with no experience in
development.