Despite Poland seeing some 2.7 million Ukrainian refugees through its borders in the wake of Russia’s attack on neighbouring Ukraine, the Polish property market has not yet been directly impacted by the war.
That’s the word from Andrew König , CEO of Redefine Properties – SA’s second largest JSE-listed real estate investment trust (Reit) and a group that has notable offshore property exposure to Poland.
Redefine has a majority 95% stake in Polish retail landlord EPP as well as separate logistics property investments in Poland.
Addressing a media briefing on Redefine’s interim results on Monday, König played down the possible impact of the Russia-Ukraine conflict on commercial property in Poland.
“I don’t expect negative [commercial property] valuations there,” he said.
“We have seen the impact on Poland with around 10% of Ukraine’s population, mainly the elderly and children, coming into the country due to the conflict … But the property market has not been directly impacted [by the war].”
Higher global interest rates and inflation
“There is the impact of higher interest rates and higher inflation, but that is also a global issue … What we have seen though, is labour shortages in Poland, with for instance some 30% of construction workers in the country normally being Ukrainians. With the conflict in Ukraine, most of these men had to head back home [after being called on to fight in the war],” he added.
König believes that the retail property market in Poland will in fact benefit from increased spending, with over two million Ukrainian refugees currently in the country.
On a logistics property front, he said Poland continued to attract major investment, citing Google’s recent purchase of The Warsaw Hub in a more than €500 million deal (from Ghelamco).
“There is still a lot of activity in the Polish logistics property market … Poland is also benefiting from the supply chain issues in Europe as a result of the war,” he added.
König said many people were asking how grave the Ukraine war could be for Poland and what pressure it would place on the country’s economy, however, he pointed out that the Polish economy is still on track to achieve around 4% GDP growth this year despite the war in neighbouring Ukraine.
Listen to König speaking on The Property Pod about Redefine’s recent R7.2bn takeover of Polish property counter EPP (or read the transcript):