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The Warsaw Voice » Business » November 25, 2011
Business & Economy
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Warsaw Increasingly Appealing to Investors
November 25, 2011   
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Warsaw Mayor Hanna Gronkiewicz-Waltz talks to Andrzej Jonas and Andrzej Ratajczyk.
As a result of the parliamentary elections, the Civic Platform (PO) party of which you are a deputy leader, will continue to govern the country in coalition with the Polish People’s Party (PSL). How will the party’s second term in power influence your work as mayor of Warsaw?
It definitely will have an impact. Aside from other factors, it is simply easier to work with ministers and other government officials whom you already know, with partners with whom you share the same goals and a vision for the development of the country and individual cities. This enables us to more efficiently carry out our development model based on “polarization and diffusion”—polarization meaning that economic growth is stimulated even at the cost of temporary disparities, and diffusion meaning that the effects of growth are diffused in such a way so as to gradually equalize opportunities for regions.

I try to manage Warsaw as a corporation rather than a political institution. The situation when there are no political differences between the central and local government is certainly helpful when it comes to designing and carrying out big municipal projects, such as building a subway or a bridge.

Warsaw is increasingly appealing to investors and moving up league tables in terms of investment attractiveness. Among other factors, this is a result of our work. Ensuring stability is the main goal of municipal authorities in any city. One of the best incentives a city can offer to business is stability. Warsaw’s success in this respect is highlighted by the good marks the city scores in business league tables and its strong ratings. Warsaw is the world’s 56th largest financial center, according to the latest Global Financial Centers Index, published in September for the 10th time. The Polish capital has been consistently moving up the league table, advancing from 67th place in the seventh league table and 59th place in the ninth. Warsaw is already ahead of Moscow, Istanbul and Lisbon, though still behind Vienna, Prague and Helsinki.

In the European Cities Monitor produced by Cushman & Wakefield, Warsaw moved up three spots this year to 21st place. Warsaw ranks ahead of Vienna and Prague in the general league table and first in terms of value for money when it comes to office space rental and occupancy costs. One can say confidently that Warsaw is leading the way on the real estate market in Central Europe. In Cushman & Wakefield’s Winning in Growth report published in September, Warsaw is ranked 12th among the most promising cities for global property investment growth. A recent report by Jones Lang LaSalle confirms the strong position of Warsaw. According to the report, in 2010 and 2011, Warsaw accounted for 60 percent of all transactions on the Polish commercial property market. Warsaw’s commercial property market, estimated at 3.5 million sq m, is the largest such market in this part of Europe.

Ernst & Young also appreciates the Polish capital. In the firm’s league table, Warsaw ranks seventh in Europe in terms of conditions for starting up a business, alongside Brussels, Munich, Madrid and Amsterdam. That Warsaw’s finances are in good shape is further shown by its A2 rating with a stable outlook from Moody’s Investors Service—a grade unchanged since 2007. In turn, the Fitch agency has rated the city at AAA with a stable outlook. The ratings are the highest a city can get and are at the same level as Poland’s national rating.

What are Warsaw’s strongest selling points in the eyes of investors?
I think Warsaw offers favorable conditions for investment. We are the capital city with the broadest range of real estate opportunities and Europe’s only capital offering C-zoned land in the very center of the city. Let’s take land designated for large retail projects. We offer investors more than 60 locations, both vacant lots and those already developed. The combined area of the land is around 414 hectares, of which 96 hectares is designated for new investment projects. Investors have indeed a lot to choose from. It is worth adding that many of these locations are very attractive and available in the very center of the city.

What else is there that attracts investors to Poland’s capital?
Warsaw is Poland’s largest market and has the highest percentage of people with university degrees and the best public transport system in the country. Green areas cover almost a quarter of the city. What is also important is that the level of security in Warsaw is higher than in any other large city in Poland. Additionally, Warsaw offers its residents a wide range of cultural attractions. Life is becoming better and nicer in Warsaw. As a result, we are seeing a rise in the number of residents and foreign investment projects. This is confirmed by fDi Markets data that show that by November 2010 more than 931 million euros had been invested in Warsaw in greenfield projects, versus 775 million euros a year earlier. Our investment figure was more than three times higher than that for Berlin.

Warsaw’s attractiveness will increase further once projects related to next year’s UEFA Euro 2012 soccer championships have been completed. The National Stadium, which in the future can be used not only as a sports arena but also as a venue for concerts and other events, is already there to be admired. A congress center will be built in the vicinity. It’s worth remembering that a number of smaller infrastructure projects, including the construction of roads and parking lots, is under way in connection with Euro 2012. After completion, they will have a positive impact on the functioning of the city and the quality of life for its residents.

Many large projects are funded from the national budget. But the city also has to invest a lot. Has the crisis affected the city’s coffers and its capacity to invest?
Of course. In 2009, we were forced to shed zl.3 billion from our initial financial plan of zl.15 billion. The economic slowdown brought our receipts from taxes and other fees down. It was only this year that we saw our revenue return to its 2008 level.

What is the role of European Union funds in investment projects carried out in Warsaw?
Very significant. EU funds account for around zl.8 billion of our current budget plans. These funds are very helpful in going ahead with the investment projects Warsaw needs.
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