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The Warsaw Voice » Special Sections » April 26, 2012
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Investing in Luxury
April 26, 2012   
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Interest in luxury apartments has grown in Poland in recent years. They are bought as a home or investment not only by well-to-do Poles, but also by foreigners.

The market for luxury apartments started to develop in Poland in the late 1990s. Initially, developers carried out luxury residential projects only in Warsaw. Then they started to do so also in other large cities, like Cracow, Wrocław and Gdynia, and in Polish holiday resorts like, Sopot Jurata, Międzyzdroje and Zakopane. Apartments in resort towns serve both as an investment and a second home where the owners can spend holidays in comfortable conditions tailored to their specific needs. After the holiday, the properties may be rented out on a commercial basis.

There are several features a luxury apartment must have. The most important ones are attractive location, excellent workmanship and attractive architecture. Clients who buy luxury apartments think first about their surroundings – they tend to choose locations in the city center, close to the Old Town, or in an expensive and fashionable district.

Also important is the architecture of the building. It is best if the building has been designed by famous architects and in keeping with the latest trends. And top quality materials should be used to construct it. Luxury apartments are provided with air-conditioning and modern mechanical and electrical equipment controlled by a Building Management System (BMS) or a similar system. It is assumed that a luxury apartment should not be smaller than 70 sq m, though the minimum size differs depending on the market. A luxury apartment should be at least 2.8 meters from floor to ceiling. Another feature of luxury apartments is open space, which makes it possible to divide the apartment into a private part with bedrooms and a part where guests are received. Apartment buildings may be provided with a swimming pool, spa facilities and a fitness center. Some of them have a concierge service, offering shopping, cleaning and other services to the occupants, whose security is ensured by an around-the-clock security and surveillance service.

Experts say luxury apartments account for no more than 2-3 percent of all apartments offered on the Polish market. This may seem little, compared to such countries as Britain, France and Germany, but one should remember that the Polish market for luxury apartments is relatively young and still expanding. However, there is a common feature – whether in Poland or in Western Europe, you have to pay a lot for a luxury apartment.

Warsaw ranks first on the Polish market for luxury apartments in terms of prices. The city is where the largest number of such apartments is built and sold. But there are wide variations in luxury apartment prices in Warsaw – they range from zl.11,000-12,000 per square meter to over zl.40,000. In the south-western city of Wrocław and the coastal Tricity of Gdańsk, Gdynia and Sopot you can find luxury apartments costing zl.10,000 per square meter. In the southern city of Cracow, you have to pay around zl.13,000. But there are apartments in these cities whose prices exceed zl.25,000 or even zl.30,000 per square meter. In the mid-western city of Poznań and the central city of ŁódĽ, where demand for luxury apartments is relatively low, the price per square meter may be lower than zl.10,000.

Luxury apartments may be located in a renovated old tenement building, converted factory, terraced house, or a high-rise building. Residential towers, popular in other countries, have appeared in Poland as well, with several projects of this kind already started. However, the global crisis forced many developers to change their plans. Many projects were abandoned, some were suspended and some were redesigned and adjusted to changing market needs.

Last year, after a break of almost two years, Orco Property Group resumed work on the Złota 44 tower, Warsaw’s most prestigious residential building. Its is scheduled for completion in 2012. Located on Złota Street in the very center of Warsaw, the building will be 192 meters high and will have 54 stories. It was designed by Daniel Libeskind, a world-famous American architect of Polish descent. The “glass sail,” as the building is called, will house 251 luxury apartments situated higher than any other apartments in Warsaw.

High-rise buildings, however, account for a small percentage of luxury apartment projects in Warsaw. Among the most prestigious apartments will be those developed by the Dom Development company in the second stage of the Opera estate in the vicinity of Saski Gardens in the center of the city. The developer has also constructed the Grzybowska 44 building in the same neighborhood. Occupants are gradually moving into this large apartment building. Among the most attractive luxury residential projects are also Rezydencja Piękna Nova developed by Magnus Group, Apartamenty Trio by Eco Group, Restaura Górskiego by Restaura Group, Nowe Powi¶le by the Menolly company, Puławska 111 by ECC Real Estate, Belgravia Residence by Belgravia Polska, Rezydencja Foksal by BBI Development and Klimt House by Echo Investment.

The Euro 2012 soccer tournament and the development of tourism will contribute to a rise in interest in buying apartments in the centers of large Polish cities such as Warsaw, Cracow, Wrocław and Poznań. Investors who buy an apartment now can expect a shorter payback period.
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