An individual approach

Oscar Kazanelson, chairman of the supervisory board: The sector witnessed a similar situation in 2000-2002. But the problem we have today is that nobody knows when the current slowdown will end. There is demand in Warsaw for 100,000 apartments. In other Polish cities, people want to buy apartments as well. The demand is present and prices will rise again. My opinion is that when the Warsaw market stabilizes, the price per square meter will stand at zł.8,000.

Zbigniew Wojciech Okoński, chairman of the management board: The slowdown will not last forever. To help a rebound, the Polish Monetary Policy Council should reduce interest rates, which are ridiculously high. I think the situation in the real estate market will clear up next year and will return to the pre-2007 situation.

What is the actual cost of developing a square meter of an apartment in Warsaw?

OK: It is about zł.6,000. Many people think that development companies have 35-40 percent margins, while in reality it is between 15 and 23 percent. 

Which is better - reducing the price or giving the client something extra?

OK: It is up to the customer. We negotiate with every client and prepare a package for him. Whether somebody needs a discount or is looking for help in financing, this is a matter of individual approaches.

ZWO: People prefer to buy apartments which are ready to live in. Our company, like many other strong companies, is able to build apartments for stock. A customer may then make a choice based on his wealth, location and other preferences. While other companies' projects may still be under construction [or put on hold], ours will already be there. So although times may seem uncertain, we are sure to sell our products. That is because we are reasonable with prices, we have good locations, we have a good reputation, ready products and we deliver on time and with good quality.

Some developers have considered the idea of remodeling their mixed-use projects to emphasize office space over residential. What is your approach to this idea?

OK: In reality, residential and office developments are two separate businesses. You need to understand the risk you are taking in both sectors. Of course there are different ideas for how to deal with the crisis. But I have been active in this business for 27 years and I can tell you for sure - I have never seen an apartment go unsold. The question is price. But I have seen many empty offices. And it may be a challenge for a company to finance and maintain these unsold or unleased offices.

What do you consider your flagship project in Poland?

Leon Gurwicz, proxy: Up until now it was Nowa Rezydencja Królowej Marysieńki, which is an upper-middle class project in Wilanów. But each flagship comes to port and finishes its journey. The first stage of the Wilanów scheme was handed over in 2004.

Our current main project is ŻoliborzCity Apartments, comprising 230 units. We will see in our financial results three years from now that this will be a flagship project for Robyg Group. The shell-and-core phase of the first stage in Żoliborz is completed. We have also had a very successful 300-apartment residential project in Ochota, which was very well received by clients.