40 distinguished speakers, 800 guests, 10 hours of debates on the most important topics in the development industry. On Tuesday, 18 September, leading experts from the industry discussed the possible directions of market development during the IV Residential Congress – the largest real estate industry event in 2018.
The Residential Congress was organized once again by the Polish Association of Real Estate Developers and the Warsaw School of Economics in order to find better and better solutions for housing.
– Science and Business have once again joined forces to have a positive impact on the housing market, and more broadly, on the entire development market and related industries – said the president of the Polish Association of Developers Grzegorz Kiełpsz at the start of the congress.
During the congress, representatives of the government, local governments, investors, architects, engineers, urban planners, the banking sector, intermediaries, contractors, trendsetters and many others sat in the discussion. There were very different opinions in two main panels and six debates. Diversity of views has often resulted in surprising conclusions and postulates
At the opening of the event Dorota Jarodzka-Śródka, the chairman of the Council of the Polish Association of Real Estate Developers, said that the Congress is the time when it is possible to develop better solutions together in a larger group. This dialogue is sometimes very difficult, but we are happy that often, despite different views, we meet here together in an open atmosphere.
Presentation of the Government’s plans
This is a special year for Poland. We are celebrating the 100th anniversary of regaining independence and at the same time the 100th anniversary of the failure to solve the housing problems of Poles. The withdrawal of the state from the housing market should not take place. It is worth talking about it today, to cooperate. State participation is a sensible response to the problems of the housing market – next year in the Mieszkanie Plus program we plan to launch an investment for up to 100,000 flats – Deputy Minister of Development and Investment Artur Soboń said entering one of the two main Panels. The first concerned housing policy. The minister presented a broad presentation on the upcoming government plans, in key legislative areas for housing, which was a point of reference for further discussion.
The first panel gathered the views of investors, local governments and independent experts who tried to assess individual actions and directions of changes in housing policy. A consistent conclusion was that for the improvement of the housing situation in Poland it is necessary to cooperate with the government, self-government and development parties, and not mutual competition. The active role of the state should, above all, consist in creating healthy foundations for development and mitigating the cyclical nature of the market – said Grzegorz Kiełpsz.In the opinion of panelists, it will be problematic to maintain the current production, let alone to increase the scale of construction, among others due to the lack of executive forces or restrictions on the availability of land. These issues require government intervention. The brakes are also prolonged procedures. Although sad, I have to admit that in Hungary, where my company is a significant player on the development market, we are able to get through the formalities much faster than in Poland – said Michał Melaniuk, Country Director of Cordia. Procedures, at least partially, are to accelerate the so-called special housing law. Whether the bill will actually increase the scale of construction will be known only after a long time – commented Kazimierz Kirejczyk, President of Reas. Jacek Jaśkowiak, the President of Poznań expressed his fears about whether the act would not disturb the urban order of cities.
2.The first block of parallel debates, that is the fight for the city, energy efficiency and technological revolutions
A city – a field of conflicts or cooperation?
From year to year, an increasing part of the population lives in cities. Introducing residents compete with those who have already been there for a living space. Thus, the question is growing up, who should the voice belong to regarding the formation of cities? Urban activists most often defend the status quo acting in the interests of the current inhabitants. Meanwhile, developers are acting rather for people who are just planning to move. It is extremely difficult to find a balance between these needs. It often requires difficult compromises and consideration of the opinions of various entities. Representatives of activists, local governments and developers agreed that these interests should be balanced and this is an extremely difficult role, especially for the city authorities.
PropTech or the future of the industry
Speakers during the debate PropTech emphasized that the key is, however, the question – does the average resident actually need these technologies, uses them and above all – is he ready to pay for them? Developers and architects also have to deal with such designing of buildings that these in 30 years would still be modern, and hence – that new functions could still be added to existing facilities. Today, we should ask no longer whether we can afford to build with the latest technologies, but whether we can afford to give up.
Construction is entering a digital evolution and an increasing number of buildings are not only bricks and concrete but electronics, software and Big Data. All this to improve the comfort of users. As pointed out by Kamil Zabadała, Sales Director at APA Group: Modern technologies are used especially in hotels and modern office buildings, and boldly used in other segments of construction.
During the debate Housing odyssey 2020 – Energy efficiency in residential buildings, the starting point for the discussion of speakers was the upcoming third change in thermal requirements in line with the so-called Technical Conditions, which will become effective on December 31, 2020. They talked about the reduction of construction costs – a real balance of profits and losses that some technological solutions bring, the appropriate allocation of investment outlays and the profitability of renewable energy solutions. We received (as a development industry) an assurance of continuing these talks after the end of the congress.
3. The second block of parallel debates was devoted to legal issues, issues of leadership and the future of cities.
Cities of the future
The debate on the future of cities – Residential Foresight 2048 – was presented to start the debate. This report was a starting point for discussions on how to create cities today in which we want to live in the future. Swiftly adapt to the constantly changing environment, or continue with the designated strategy? – Trends change very quickly. We should be careful about turning. It may turn out that the original target could bring greater benefits – said Katarzyna Gruszecka-Spychała, vice-president of Gdynia.
During this debate, a Report on Leadership in the development industry was presented, which was prepared by SGH in cooperation with PZFD. Experts from the world of science “took the wallpaper” of managerial practitioners from the world of building and tried to indicate the best practices for future use. Practices that will not only make the best use of occasions, but also protect the company in difficult times.
In this debate, investors and lawyers presented Minister Arthur Soboni with real examples of how unexpected problems some of the cities gave them in the case of perpetual usufruct land. In many places of the city, although they have themselves adopted spatial development plans, they are blocking the investments that we want to build according to them, obscuring vague provisions of contracts regarding perpetual usufruct, from the PRL era – said Mateusz Bromboszcz, Vice President at Atal. The city itself has adopted a zoning plan, and then retains the investments provided for in the plan, claiming that they are inconsistent with the provisions of the agreement or decision regarding the establishment of the right of perpetual usufruct. It is an internally contradictory and legally controversial practice – said Wojciech Jacyno, a lawyer from the law office of Prof. Wierzbowski & Partners. Minister Soboń confirmed that his ministry sees the problem and ponders its comprehensive regulation. The discussion also touched upon the changes that will bring and the risks posed by the transformation of perpetual usufruct into ownership.
4.Financing the housing market
Discussions on that day ended the second of the main panels Fri Financing the housing market – are there still measures that allow for the scale of construction we currently have?
Although it was the last panel of the Congress, it turned out to be the most thrilling polemics of the day. The speakers were arguing about whether it was possible to provide financing for maintaining the current scale of housing production, if there had been a postulated liquidation of open housing fiduciary accounts. Developers cited analytical data, which indicates that the scale of bank financing would have to grow up to 10 times. Such growth is now completely impossible – commented Piotr Sztembartt, Director of the Investment Projects Department at Getin Noble Bank S.A. Iwona Załuska, the President of Upper Finance, emphasized that in the current situation “after GetBack” there is no chance for significant financing from bonds. UOKiK argued that open accounts do not guarantee full protection for buyers, and the process of recovering funds or completing investments can take a very long time. Edward Laufer, CEO of Vantage, reflected the arguments that there is not even one case for an open account to fail clients. During the discussion, the concept of setting up a developer’s guarantee fund appeared that could function in conjunction with an open account. According to the majority of lecturers, the liquidation of an open account would mean a drastic fall in housing production and a blow to small local developers.
5. City Ranking
The congress was crowned by a ceremonial awarding of prizes in the City Ranking, in which PZFD assesses the efficiency of architectural and building administration authorities in terms of the speed of issuing decisions on building and land development conditions and building permits for multi-family housing projects, as well as the coverage of urban development plans. In the 8th edition of the Town Ranking, the city of Poznań won. Łódź was in the second place and Gdynia and Wrocław were third ex aequo. Congratulations to the winners!
About the organizers
The Polish Union of Real Estate Developers is an organization with over 15 years of history, bringing together 170 developers who are responsible for about 50% of residential production in the country. PZFD operates in the field of legislation, creates standards and provides a platform for exchanging experiences in the form of thematic groups, where over 1,000 people meet annually. As part of governmental bodies, PZFD shares its knowledge, experience and points to significant problems. He develops solutions to practical problems with self-governments and related industries.
The Warsaw School of Economics, founded in 1906, is the oldest economic university in Poland and at the same time one of the leading economics universities in Europe.
The honorary patronage over the event was taken by the Ministry of Investment and Development, the President of Wroclaw and the Association of Polish Architects.
The event took place at the National Forum of Music in Wrocław.