The Slovak who stayed

Stanislav Frnka, senior partner, Griffin Real Estate: When it had already been decided that I was leaving HB Reavis for good, I had several phone calls from my friends, mostly from Poland, and I also got a few requests for joining some other groups in Slovakia. But I’ve been on the market for more than ten years in Warsaw. The business here is much bigger than in other countries of the region. And I’ve known Przemek Krych since 2012. We’re quite good friends and we quickly got into a discussion. And that’s why I made my decision to stay and join Griffin.

When I contacted you previously, you said you were happy to give an interview but were too busy. So what have you been doing since then?

Attending lots of meetings, as there are a lot of platforms that Griffin runs. I can’t approach the office side because my agreement with HB Reavis forbids it. I’m not even allowed to engage in consulting. This prohibition will continue until next year. At the moment outside of the Echo Investment platform there is EPP, Resi4Rent, student housing in the form of Student Depot and logistics – European Logistics Investment. And we are trying to get more involved in hotels.

But what’s your precise role in the company?

At the moment, my role is to observe and help whenever and wherever I can. I am also doing my best to understand all the platforms. By September there should be some final discussion about what I’ll be doing. I’m the only guy in the group with a development background. All the other guys are mostly analysts, bankers or lawyers. With Resi4Rent and Student Depot, the development part is being done by Echo. With Resi4Rent we have several thousand units for rent under development. We want to be the largest in Poland within five years and dominate the market in the larger cities in Poland.

You mentioned hotels earlier. Were you referring to Polcom?

To some extent, yes. In 2018, Griffin, together with Pimco, acquired 70 pct of Polcom. Right now we are trying to look into how we can approach this segment more thoroughly. And this is not easy, as we need to launch a new strategy. Here, in this region, hotels are either international or local. We’re not interested in the international hotels; but the local ones, on the other hand, are not really for sale or are not of the quality we would expect. We’re not entirely sure we want to conquer the market now, but by the end of the year we’ll know what we want to do.

You also mentioned logistics...

Yes, there’s the logistics platform, European Logistics Investment – or ELI. Here we work with Panattoni and are creating the largest fund with several hundred thousand square metres of logistics space. For now we are focused on Poland, where logistics is a hot topic. There’s still a lot of demand from clients and, given the regulations on the Polish market, it’s not so easy to deliver projects. Panattoni is the most significant player in the market, so that’s why we decided to work with them. We came up with a model we can work together with. We develop projects with them and the fund is already established. Half a million square metres is already under management

How large do you want to expand this to?

At a conservative estimate, I think 1.5 to 2 mln sqm within four years.

What’s happening with Student Depot, your student housing business, right now?

Including Warsaw, there are already five projects running, all rented out. One in Gdańsk is under construction, which will have 370 beds.

And it has to be ready by September...

It has to be already running. Our hall in Poznań has been running for five years. Given the size of the market, what we have added so far is just a drop in the ocean. And from the beginning it has been fully leased.

What kind of size are you aiming for?

In general, the sky is the limit. We intend to add 1,000 beds to the portfolio each year, but we will adjust those numbers to the situation on the market. The potential is enormous. In large cities there are several hundred thousand students – and not just from Poland but also coming in from abroad.

What do you personally hope to achieve at Griffin?

I’m happy I have the chance to work with Przemek Krych and I think I will enjoy myself here.