In search of new markets
Adam Zdrodowski: We have seen a large number of Spanish developers enter Poland in recent years. How would you explain this phenomenon?
Jaime Fúster: One reason is that developers have grown a lot in recent years in Spain, to the point that they needed to find a new environment to invest in.
AZ: Does that mean there is no room for further expansion in Spain?
JF: There is very little room in Spain to expand at the moment. Demand has decreased because we were already delivering more houses than were actually needed.
AZ: Is it difficult for a Spanish developer to enter the Polish market?
JF: Spanish companies began to come to Poland quite late, they mainly discovered Poland in 2003-2004 and in the following two years the investment was really intense. They found some problems in the beginning, but in terms of being able to understand the differences between the Polish and Spanish legal systems and the ways of doing business here, things are very much on track.
AZ: How many Spanish developers are there in the Polish market at the moment?
JF: When it comes to developers active in the market, there are approximately 50. Another 150 are interested in the Polish real estate market.
AZ: So do you think more Spanish developers are bound to come to Poland?
JF: Small investors are being more cautious now and are withholding the process of entering Poland but there are also medium-sized companies which are selling their assets in Spain to reinvest in Poland.
AZ: Are Spanish investments centered in Warsaw or are these developers present in the regional cities as well?
JF: In 2006, it was mainly Warsaw. In 2007 and Q1 2008, by contrast, they were moving more to the north to places such as the Tri-city region and Szczecin. There were also Spanish investments in Łód, Poznań and Wrocław last year. And Katowice and the whole southern region of Poland are just starting to attract investment now.
AZ: What sectors of the Polish real estate market are of particular interest to Spanish companies?
JF: Spanish investments are mostly residential, although Spanish developers are starting to be very active in the delivery of office space as well.
AZ: Spanish developers have been mostly successful in Poland. There has been, however, the well-known case of Ferrovial, which had problems with its construction of the Warsaw airport's new terminal. Do you think this could have some impact on other Spanish developers in Poland?
JF: The Ferrovial case is different in that it concerned the infrastructure business rather than the real estate business. Ferrovial entered the country at a very early stage and the infrastructure market is actually only just starting [to experience significant growth] now. The company has made huge investments in Poland and I am pretty sure that it will recover soon.
AZ: What are your predictions for the future of the Polish real estate market?
JF: The rate at which the prices have been growing in recent years was maybe too high and, in my opinion, the growth will definitely slow down. There is still great demand for houses on the market, however, so the market will continue to grow.
