As the BPO/SSC sector in Poland transforms into advanced competence hubs, it is driving changes not only in the industry’s employment profile but also in its office space needs.

Mateusz Strzelecki, Partner / Head of Tenant Representation at Walter Herz

The BPO/SSC sector in Poland is not slowing down, it is entering a new stage of development. The industry is currently facing challenges resulting from the relocation of business services to other parts of the world. Poland is no longer a market driven primarily by cost advantages. Rising wages and other operational expenses are making the traditional process outsourcing model increasingly unsustainable. At the same time, the demand for conventional operational roles is further reduced by ongoing automation and the advancement of AI solutions.

Poland’s strength today lies not in the number of jobs created, but in the maturity of its business services sector, its specialization, competencies, and ability to deliver high-value services. The industry continues to expand its capabilities in areas such as technology, R&D, cybersecurity, and advanced analytics, which allows Poland to remain one of the key players in the region. The country is part of the global transformation of the sector, but no longer serves merely as its cost-effective base.

We are therefore not seeing a reduction of BPO/SSC activity in Poland, but rather its evolution toward more advanced services that require highly qualified talent. The competitiveness of the sector is now measured not by the number of operational roles, but by the quality and sophistication of the services delivered.

The Impact of Industry Transformation on the Office Market

These structural changes are having a significant impact on the office market, particularly in Poland’s regional cities, which for many years served as natural locations for business service centers thanks to lower operating costs and strong access to talent. Today, however, regional office markets are seeing rising vacancy levels, while there is a noticeable shortage of investors able to occupy large office spaces.

Despite these challenges, the business services sector remains one of the most important segments of the Polish economy and a key group of office tenants. The BPO/SSC sector accounts for around 16 percent of total office space demand nationwide. Cracow and Wroclaw continue to lead activity among regional markets, as confirmed by recent lease renegotiations by major companies such as Motorola Solutions (Green Office) and Shell (DOT Office).

Less Space, More Quality

Recent data shows that nearly 489 thousand people are currently employed in business service centers across Poland, with employment in the first quarter of 2025 over 6 percent higher than a year earlier. The sector is therefore not in decline but undergoing an intense transformation that is also reshaping its office leasing strategies and models. Companies are not giving up on offices, they are redefining their function and optimizing space usage.

Tenant priorities are changing: space is no longer the key factor, quality is. BPO/SSC companies are increasingly choosing certified Class A buildings located in well-connected areas, offering a broad range of amenities such as cafés, terraces, relaxation zones, and cycling infrastructure. This shift in demand toward premium locations is particularly evident in Warsaw, where the vacancy rate in the city center has dropped to 6.9 percent. With limited new supply on the market, this trend is driving growing competition for office spaces that meet the requirements of advanced business processes.

Core & Flex Instead of Traditional Expansion

In the new market reality, companies are increasingly adopting the Core & Flex model. Traditional offices  (core) serve as centers for management, integration, and the strengthening of organizational culture, while flexible spaces (flex) are used to support temporary projects, new teams, or recruitment activities. We are therefore not seeing a withdrawal from conventional offices, but rather their functional reorganization, adapting workspace to new work systems and evolving project needs. The sublease market is also gaining popularity, enabling companies to make more efficient use of surplus office space.

Rising labor costs and the advancement of AI technologies are reducing the demand for employees performing repetitive tasks. Poland is no longer a market for low-cost labor for global corporations, but rather a hub for specialized, high-value services. This shift, in turn, is driving the evolution of office standards toward spaces that support advanced processes, collaboration, creativity, security, and ESG compliance.

Reorganizing Office Portfolios

Strategic leasing decisions are enabling companies to optimize costs and flexibly adjust their office space to the current scale of operations. This also signals that the sector is entering a phase of office portfolio consolidation. Some companies are considering merging their regional offices or relocating to smaller yet higher-quality spaces. Such relocations typically involve a reduction in leased space by around 20–30 percent. On the other hand, the growing pressure for employees to return to the office is limiting the extent of these reductions. The trend, however, is clear — less space, more quality.

Current investments in Poland’s BPO/SSC sector are no longer focused on expanding floor area but on consolidating resources, improving the quality of the work environment, implementing new technologies, and choosing spaces better suited to hybrid work models that support the operation of specialized competence centers.

(Press Release)