Best year for resi developers

One of the most important incentives stimulating sales at the end of last year were the changes to the ‘Apartments for the Young’ programme, which added to the incentives for large families and extended the beneficiaries to secondary market buyers. “In all the cities surveyed, the proportion of such applications in the number of apartments sold went up. Concerns that the pool of subsidies could run out as a result of the competition from secondary market buyers was one motivating factor behind this. The participation of 3+ families was also significant, according to BGK’s data, submitting eighteen times more applications for subsidies than in the first eight months of 2015,” comments Kazimierz Kirejczyk, the president of the board at Reas.

Record high sales

The data collated by Reas confirms the high level of sales for developers. The majority of companies finished the year with higher sales, while some companies enjoyed the highest sales in their histories. These included Atal of Cieszyn, Archicom, Robyg, Ronson Development, Matexi Polska and Lokum Deweloper.

Atal sold 1,690 apartments in 2015, with a gross sales margin of 28.3 pct and a net margin of 16.7 pct. In 2016 the company is planning to invest PLN 100–120 mln in the purchase of plots. It also plans to launch 21 new projects and subsequent stages of projects already under construction. These will all be located in the cities the company has operated in up till now (Łódź, Kraków, Katowice, Wrocław and Warsaw) as well as Gdańsk and Poznań. This year the company is aiming at a similar sales level to last year, i.e. between 1,500 and 1,800 apartments. In the period between 2018 and 2020 it is planning to increase its sales to 2,000–2,500 apartments. The Archicom group signed development and reservation agreements for 611 apartments in 2015 – 17 pct more compared to 2014. In the first few months of 2016, Archicom is planning to launch the sales of around 300 apartments in its two latest projects. “In 2017 we are planning to exceed annual sales of 1,000 apartments,” declares Paweł Ruszczak, a member of the board of Archicom. Robyg, meanwhile, signed sales contracts for a net amount of 2,333 apartments in Warsaw and Gdańsk last year – a 10 pct increase on 2014. This brings the developer closer to the execution of its investment plan, which envisages 5,000 apartments handed over in 2015 and 2016. Its management board is hoping to sell around 2,500 apartments in 2016. Ronson Development finished 2015 with sales of 906 apartments, 27 pct more than a year earlier when 711 apartments were sold. This year the company hopes to maintain its sales pace thanks to launching the sales of as many as ten new projects, comprising almost 1,200 apartments in total. “In 2016 we want to have a similar sales result as last year. Our goal is to exceed 850 apartments sold. However, much will depend on how quickly we can obtain building permits, which is particularly the case with our latest projects in Warsaw – on ul. Jaśminowa in Mokotów and ul. Marywilska in Żerań,” explains Tomasz Łapiński, the financial director of Ronson Development. Lokum Deweloper, which builds residential projects in Wrocław, increased its pre-sales of apartments by 37 pct in 2015 – the highest figure in its history with 486 preliminary contracts signed. It is planning to maintain the high level of sales this year because it is plans to put four new projects on the market with 767 apartments.

New records will be hard to achieve

“Even though there are no macroeconomic grounds for suggesting a strong decline in demand over the next few months, the uncertainty factor could impact buyers’ decisions. Changes in the economy are difficult to predict: the speed of price increases, changes on the job market, the scale of the increase in households’ incomes – particularly when it comes to households interested in buying apartments. The government’s approach to such crucial issues as the act on the protection of buyers’ rights, financing the ‘Apartments for the Young’ programme and extending the number of apartments for rent carried out by BGK Nieruchomości, will also turn out to be important. We do not know what will happen with mortgages denominated in Swiss francs, the construction code or the regulations on the availability of land for development. Assuming that the Polish economy will carry on without any sudden disruptions, it can be expected on the one hand that 2016 sales will still be good although lower than last year, while on the other hand the supply will be the same as in 2015,” adds Kazimierz Kirejczyk.