Warimpex decides on office buildings instead of hotels in Warsaw

Warimpex plans to convert two tenements in the center of Warsaw into office buildings and not into luxury hotels as previously planned. After analyzing the hotel and office markets in Warsaw, the company decided to choose a safer, less costly investment.

Warimpex, like other developers, has taken into account the situation on the global real estate market and the repercussions of the financial crisis. The company has altered the direction of the Próżna Project because building an office property requires much less capital than a luxury five-star hotel.

"We've chosen the option which is best for our shareholders. The Warsaw office market is developing very well. We have two fantastic historic tenement houses, very well located in Warsaw. Without much difficulty we'll find tenants for office space as well as for the service spaces which will be located on the first floor of the proposed project," said Franz Jurkowitsch, a president of Warimpex Finanz- und Beteiligungs AG.

The company already has permission to build a hotel on Próżna, however, and is now awaiting permission to renovate and reconstruct the tenement houses into office buildings. This is not expected to prolong the project, which should be completed by the end of 2010.

Though it decided against building a five-star hotel in Warsaw, Warimpex has recently announced that it will develop four budget hotels in Poland as a joint venture with Louvre Hotels under the brands Campanile and Premiere Classe. Three out of four estates for this project have already been acquired, in Wrocław, Bydgoszcz and Zielona Góra.

In the first nine months of the year, Warimpex's revenues were €70.9 (zł.273.6) million, while its net profit for the period came in at €2 (zł.7.7) million.