Warsaw City Report, Q3 2012

Report Summary:

ECONOMY/INVESTMENT

Poland remains as one of the few countries to report a positive (2.4%) GDP growth over Q2 2012. According to Consensus Forecast, the same growth figure is expected for the whole of 2012, followed by a minor slowdown to 2.1% in 2013. Retail sales increased by 7.9% between January and September, compared to the 11.7% growth recorded over the same period of 2011. The unemployment rate as of September stood at 12.4%, which is visibly higher than the 11.8% recorded in September 2011.

OFFICE MARKET

Supply: More than 148,100 m2 of office space was delivered in the first three quarters of 2012, with 56,100 m2 of that space coming in Q3 2012. The South-East office district saw two new office completions within Wilanow Office Park, including a building delivered for Asseco and the B3 office block, both totalling approximately 29,500 m2. The City Centre saw one new completion: Senator (23,250 m2) developed by Ghelamco. It is estimated that Q4 2012 will see up to 120,000 m2 of new deliveries, of which 41% is pre-leased. However, some developments may be rescheduled for January 2013. 2013 will register a very high volume of new office completions with more than 300,000 m2 expected to be delivered to the market. This substantial amount of new office space will have an impact on the vacancy rate.

RETAIL MARKET

Supply: The modern retail market in Warsaw and its wider agglomeration exceeds 1.5 million m2 of GLA. It offers a variety of retail formats: 33 shopping and shopping & leisure centres (68% of the total floorspace), 5 retail parks (18%), 23 stand-alone retail warehouses (12%) and two outlet centres.

INDUSTRIAL MARKET

Supply: The 16,000 m2 completed at Gate One in Warsaw was the only new space delivered to the market in this region in Q3 2012. The total stock in the Warsaw region is 2,520,000 m2 (as at end of September 2012). It remains to be largest regional market in Poland, followed by Upper Silesia with 1,360,000 m2.

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