Fund to get fast returns on bowling
AIB WBK Fund Management, manager of the Nova Polonia fund, spent $5 million last week to acquire a minority stake in United Entertainment Co. (UEC), operator of the Atomic World bowling and entertainment centers, said Piotr Oskroba, the general director of AIB WBK.
Oskroba, who would not reveal the size of the stake, said that AIB WBK sees a lot of potential in bowling, whose popularity is growing throughout Europe. He said that Poland has just one bowling lane per 250,000 residents compared to the U.K.'s one lane per 9,500 inhabitants.
UEC operates two bowling centers in Warsaw and one each in Krakow and Wroclaw. All of them have video games, pool tables, a bar and a disco.
The company plans to have as many as 24 outlets in big cities around Poland by the end of 2004, according to a company business plan obtained by the Business Journal.
A typical $2 million-$2.8 million investment in a bowling center could pay back in as quickly as three years, Oskroba said. "It's a quick return, but some risks are involved," he said.
AIB WBK is looking to earn an internal return rate of 30%, he said, and expects to withdraw from the investment in three to five years.
By 2004, UEC plans to have 24 bowling clubs in Poland as well as four in the Czech Republic and Hungary, which would put the company's value at about $140 million, according to UEC figures included in the plan.
"It would be a good product to sell," said Oskroba, who added that AIB WBK would eventually look to sell its stake in UEC to strategic investors, a stable financial investor or through an initial public offering.
Holland Park hopes for
tenants by December
Holland Park Apartments, a high-end residential development near plac Trzech Krzyzy in Warsaw, is hoping that its first tenants will move in by the end of November, according to Mansion & House, the agency marketing the project.
Holland Park, developed by the Netherlands-based ING Real Estate, will comprise two apartment buildings for rent and one building with apartments for sale, said Waldemar Kania, head of Mansion & House.
The first building, which contains 38 apartments, will be completed later this month. "We believe the first tenants will move in between mid-November and December," Kania said. The second, 26-apartment building is planned for completion in January, while the third, smallest one will be completed by April.
ING hasn't signed any tenants yet, as it wants to ensure that all apartments can be moved into immediately, he said.
The project will target Western managers willing to rent high-end apartments in a prime Warsaw location, he said.
Holland Park is not likely to turn any of its residential space into offices, even though some tenants expressed interest in renting apartments for business purposes. "This is a residential building," Kania said.
ING plans to charge $20-$30 per square meter, with the most expensive apartments located on the top floors. The average apartment size is 90 to 100 square meters or about $2,000 a month, he said.
Metro to boost investment
German retailer Metro plans to invest zl. 600 million ($130 million) in Poland by the end of 2002 for the development of 30 retail outlets, the company said during a conference marking its five years in Poland.
"Poland is very promising and a priority in our expansion," said Metro President Hans-Joachim Krober, who wouldn't reveal details about what kinds of stores and in what locations Metro is planning to build.
To date, Metro has invested zl. 2.5 billion ($550 million) to develop eight shopping centers called M1 and several dozen stand-alone outlets. In Poland, Metro owns the Real hypermarket retail network (23 outlets); wholesaler Makro Cash and Carry (18 outlets); Praktiker, a retail chain specializing in construction and gardening materials and accessories (14 outlets); and Media Markt (7 outlets), which sells electronic goods, hi-tech products and household appliances.
Last year the company tallied zl. 8 billion ($1.7 billion) in revenue, about 4% of its worldwide turnover. Up to 95% of goods sold by Metro in Poland are locally made, the company said.
Warsaw unattractive but tempting
Although Warsaw is not an attractive location for manufacturing businesses, many international companies plan to expand here in the next five years, according to a recent Healey & Baker report.
Warsaw ranked 23rd out of 30 possible European cities in which companies preferred to have a manufacturing business, ahead of Budapest (24), Rome (25) and Moscow (30). The 504 multinational companies operating in Europe surveyed ranked London first, Paris second and Frankfurt third, according to the report.
Despite their negative views on Warsaw, companies surveyed cited the capital as their primary destination for expansion. As many as 42 companies surveyed said they plan to open up a satellite operation in Warsaw within five years, as compared to the 35 that chose Prague or the 29 favoring Budapest. While a willingness to expand to Warsaw could simply result from the fact that many companies are not present here yet, 11% of firms questioned said they viewed Poland as the most attractive location for setting up a manufacturing business within five years. Poland ranked behind Germany and Spain, where 25% and 16% of companies said they viewed the locations as the most attractive. Poland ranked ahead of Ireland (6%) and the Czech Republic (5%), Healey & Baker said.
In brief:
Developer Globe Trade Centre (GTC) appointed DTZ as the lead agency to market its Taurus office building in Warsaw, GTC said.
GTC said DTZ wouldn't be the exclusive agency and that it welcomed other agencies to become involved in leasing space in the project.
The 18,000 square-meter Taurus is planned for completion next year. Taurus is the ninth building in GTC's Mokotow Business Park Project, which will eventually have 10 buildings.
