Will the amendment to the Polish Special Housing Act bring more investments?
Will the new regulations have a significant impact on expanding investment opportunities on degraded post-commercial and office land? To what extent do they really give developers access to new, attractive locations for housing projects? What impact on prices will the strict parking requirements requiring designing 1.5 parking spaces for each apartment have?
Mariola Żak, sales and marketing director at Aurec Home
The amendment to the Special Housing Act is gaining in importance and arousing more and more interest, and the reason is obvious - the limited supply of land suitable for housing investments. That is why developers are increasingly trying to take advantage of its benefits. Certainly, the construction of flats in degraded areas can contribute to the revitalization of areas that were previously neglected. Creating new housing can attract new residents, revitalize the neighborhood and contribute to improving the quality of life in the area. Old shopping centers, office buildings or post-industrial areas often have convenient locations, proximity to infrastructure and good communication with other parts of the city. Enabling the construction of apartments in these areas gives access to attractive locations for new investments, which is beneficial for potential buyers.
In addition, the construction of apartments on various types of land allows for the diversification of the housing offer. Buyers gain a choice of various housing options, from lofts in converted office buildings to apartments in revitalized old shopping centers. Increasing the diversity of the offer will certainly be beneficial for people looking for unique and unconventional housing solutions.
At the same time, the so-called The deregulation act is to introduce a minimum number of parking spaces in housing investments, which is to be at least 1.5 parking spaces per unit. Developers do not like this solution very much, because it is not in line with the pro-ecological trends that aim to reduce the number of cars entering city centers, therefore it is natural to reduce the number of parking spaces. This minimum number of parking spaces will increase investment costs. According to various calculations, it will be between 70 thousand. PLN and 100 thousand PLN per apartment. This is quite a lot, considering that the act was supposed to enable the creation of housing for people with moderate incomes. Meanwhile, in this mode, small-scale investments will defend themselves rather than the more common ones with a larger number of apartments.
Angelika Kliś, member of the board of Atal
In theory, such land has great potential, and among the advantages is the location of many of them in or near city centers. However, each case must be analyzed in detail, taking into account all parameters. In practice, the revitalization of post-industrial or commercial areas is a complex investment project. It requires more work and many additional administrative and construction activities. It makes sense when an attractively located area with a very large development potential undergoes transformation. In our case, they usually correspond to multi-stage projects, i.e. those spread over time and over a large area.
When it comes to the parking space ratio, this is an example of regulations detached from reality and lack of understanding of the individual requirements of a given investment. Increasing this coefficient, in my opinion, contradicts the idea of eco-housing estates and is not in line with the direction of contemporary urban trends. Rather, cities should develop mobility infrastructure, e.g. a network of bicycle paths, and encourage people to use public transport. In our investments, where the parking ratio is close to the proposed one, we struggle with a surplus of parking spaces that customers do not need and do not want to purchase.
A larger coefficient also affects negatively, among others for the creation of outdoor areas, which we would prefer to use for attractive recreation and leisure zones, e.g. greenery or playgrounds, rather than parking spaces.
The provision that requires the production of additional parking spaces may also increase the prices of flats, as it significantly affects the costs of those investments where, in order to meet the requirement, it is necessary to build underground garages, which is one of the most important costs of the entire investment.
Małgorzata Ostrowska, director of the Marketing and Sales Division at J.W. Construction Holding S.A.
Let's start with the fact that the construction of garage halls is very expensive. Increasing the parking rate per apartment will result in higher costs of investment implementation, and thus also the final prices of apartments.
Therefore, determining the number of car parks should depend on the characteristics of a given project - for whom it is implemented and in what location. In our case, we already implement investments with a ratio of 1.3 or 1.5, or even 1:2 in the case of a single-family housing estate in many projects.
On the other hand, we also have projects such as the Pruszków Station. This is an investment located in the vicinity of the railway station. Compact premises, which dominate the project, are purchased primarily by young, environmentally conscious people who use public and rail transport on a daily basis. In this case, a coefficient of 1.3 is therefore unjustified.
Marcin Michalec, CEO of Okam
The amendment to the Special Housing Act is extremely important, it can facilitate access to attractive locations for new projects, we view this idea positively. This change in the regulations gives more flexibility and the possibility of using land that was previously developed, but was not used to its full potential. We are constantly looking at the market, looking for attractive locations, and unused areas, old shopping centers or unprofitable office buildings, as well as post-industrial and post-military areas can be interesting investment opportunities that will help meet the current housing needs.
We bear in mind that land resources for future investments in agglomerations are limited, especially when it comes to central locations, and the demand for housing remains high. The revitalization of plots also has a positive impact on the area. New places with a higher standard appear instead of destroyed buildings.
Increasing the parking rate per apartment will certainly be a challenge, given the increase in investment implementation costs, which in turn will affect apartment prices.
Eyal Keltsh, President of the Management Board of the Robyg Group
Providing new land for housing development will always be beneficial for citizens, as it will potentially improve the supply and stabilize housing prices, if only administrative procedures are more effective. For now, however, these are not large areas that could change the market situation. As for car parks, most responsible developers have been offering such standards for a long time, so these regulations are unlikely to affect changes in prices or offers for residents.
Andrzej Gutowski, Vice-President, Sales Director of Ronson Development
The amendment to the Special Housing Act has certainly opened up new investment opportunities, and new land for housing construction is always very much needed, also in post-commercial areas. A high ratio of parking spaces can be a certain difficulty when designing an investment and affect the final price of the apartment.
Dariusz Nagórski, Investment Director at Aria Development
The new regulations assume, among others, that there should be at least 1.5 parking spaces per apartment. This addition to the apartment can be quite expensive. This will translate into housing prices and ultimately the customer will pay for these ideas of the government. The owner of a studio flat will have different needs in terms of having a car and thus a parking space, and a large family living in an apartment of several hundred square meters will have different needs. Similarly, the inhabitants of housing estates near the subway and on the outskirts of cities will have different needs. It is also worth considering whether it is ecological to add more layers of concrete under parking spaces.
Thanks to Lex, the developer, brownfield areas in cities were to be quickly developed with residential buildings. However, that did not happen. And although three years have passed since the entry into force of these regulations, investors still use them extremely rarely.
Damian Tomasik, founder of Alter Investment
The very idea of the special development act is good, because it can systematically accelerate the changes in the purpose of land, which are desirable in the current market realities. It should only be noted that the act itself does not change the purpose of these areas. This requires carrying out very complicated and costly preparatory works which are uncertain as to the final effects. Therefore, despite the fact that this Act has been in force for several years, only a few projects based on it have been created. In addition, increased parking rates may further reduce the profitability of such investments. On the one hand, we can observe a clear trend for city dwellers to give up cars, but on the other hand, regulations impose a large and even increasing number of parking spaces, which is an obvious conflict. These excessive requirements regarding the number of parking spaces will translate into higher real estate prices, as the costs of building garage halls have a large impact on the final price of the apartment.
Source: dompress.pl
Photo: Bohema Strefa Praga, OKAM
