Land goes west, ties with Siemens for Berlin center
Developer and retailer Land last week signed a preliminary agreement with electronics firm Siemens to build a $40 million business center called Siemens Stadt in Berlin.
Negotiations now focus on whether Land will buy or lease the site, which would become the first Polish center with Polish firms in the German capital, the developer said.
"We don't want to wait for the European Union in Warsaw, but three years before Poland becomes its member, we plan to be in Berlin," said Zenon Mikulec, president of Land. "And Berlin is not only Germany, it's the European Union."
Construction on the 20,000-40,000 square meter center has yet to begin and Land has not set any target for completion of the center, which the company said could house Polish banks and tourist agencies. Those Polish firms would also become shareholders in a separate Berlin company to operate the investment, Land said.
"We already have declarations of producers from the food and clothing sector," Mikulec said, without detailing company names. Construction is to be financed by the new company's own capital and bank loans. "Actually, our share will account for just 20-30% of total costs, the rest will be provided by banks," Mikulec said. "I am talking about concrete banks that we have been talking to, including German ones."
Mikulec didn't know which option, leasing or purchase of the premises, the developer would choose.
"Siemens provided us with a detailed price list, so it's just a matter of negotiations which option we pick," he said. "If it's a lease, we are talking about a 50-60 year lease."
The center in Berlin would be the company's second venture.
Land built a trade center in Warsaw through capital raising efforts from 240 shareholders that also have space in the center. The ownership structure is similar to that of cooperatives.
"We are a good example of how Polish traders can organize themselves," Mikulec said. "Remember that Land also groups street traders from the open-air markets on Walbrzyska, Plac Defilad and Powsinska."
Land shareholders have exclusive rights to occupy the 42,000 square-meter trade center on ulica Walbrzyska in the Warsaw district of Mokotow, where the purchase of 27 shares priced at $1,200 a share corresponds to one square meter of space in the center.
"There are still around 1,500 square meters waiting for an owner," Mikulec admitted. "But, generally speaking the business is starting up and what we need now is better promotion."
