VOLUME 18, NUMBER 40 • OCTOBER 8-14, 2012 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127 Since 1994 . Poland’s only business weekly in English

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EXPO REAL SPECIAL EDITION12 pages of real estatenews & analysis, including:

• KSP’s investment plans

• Polish investment market

• GreenWings construction

• ECE’s new shopping center

• Warsaw PPP project

• Home sales slipping

Poland’s commercial realestate sectors all showthe country out ahead ofthe regional pack 12-23

SECTOR ANALYSES:Retail . . . . . . . . . . . . . . .14

Office . . . . . . . . . . . . . . .17

Logistics . . . . . . . . . . .22

PPrreetteennddeerr ttoo tthhee tthhrroonneeLaw and Justice have revealed their candidate

to replace PM Donald Tusk 3

MMoonneettaarryy mmyysstteerryyPoland’s Monetary Policy Council shocked the

market with its decision to keep rates on hold 8, 28

News . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2-3

Business . . . . . . . . . . . . . . . . . . . . . . . . . .4-5

Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Finance & Economics . . . . . . . . . . . . . . . .8

Art in Focus . . . . . . . . . . . . . . . . . . . . . . . .10

Opinion & Analysis . . . . . . . . . . . . . . . . .11

Lokale Immobilia . . . . . . . . . . . . . . .12-23

Interview . . . . . . . . . . . . . . . . . . . . . . .24-25

The List . . . . . . . . . . . . . . . . . . . . . . . .26-27

Markets . . . . . . . . . . . . . . . . . . . . . . . . . . .28

Sports . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29

Lifestyle . . . . . . . . . . . . . . . . . . . . . . . . . . .30

Last Word . . . . . . . . . . . . . . . . . . . . . . . . .31

In this issue

Prime Poland

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Plus• Yelp enters Poland

• Kubica’s comeback

• Alior looking at IPO

• Growing art market

• Gadu-Gadu going quiet?

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Interview:Juliusz MadejDon’t fault Polish

universities for

graduates’ unprepared-

ness, argues the

president of Lazarski

University 24-25

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Cyprus

IrelandSpa

inUK

GermanyEU27

France

Czech R

epublic

PolandRom

ania

OCTOBER 8-14, 2012NNEEWWSS2 www.wbj.pl

Poland gets

LNG loanPolish state-controlled

gas grid operator Gaz-

System has received the

final round of financing it

needs to start building

Poland’s first liquefied

natural gas terminal,

securing a €75 million

loan from the European

Bank for Reconstruction

and Development. The

terminal is expected to

start importing gas from

Qatar in 2014. “What this

project really represents

is a choice for Poland to

receive one third of its

gas from a country other

than Russia for the first

time,” EBRD managing

director for energy and

natural resources

Ricardo Puliti told

Reuters.

Poll: PiS

ahead of PO

The latest TNS Polska

voter survey has Poland's

biggest opposition party

Law and Justice (PiS)

with 39% support, putting

it 6 percentage points

ahead of the ruling Civic

Platform (PO). Third was

the Democratic Left

Alliance with 9% support,

followed by Palikot's

Movement and PO's

junior coalition partner,

the Polish People's Party

– both at 5%

Road projects

at z∏.15 bln

in 2013Some z∏.15 billion will

be spent on road

construction projects in

Poland next year,

Rzeczpospolita

reported, citing General

Directorate for National

Roads and Highways

data. That’s almost half

of what contractors

were promised in 2012

for public projects,

although the real

amount that will go to

their pockets will most

likely be z∏.4 billion

less.

Nuclear

partner talks

French energy giant EDF

has reiterated its interest

in partnering up with

Polish state-controlled

utility PGE in the Polish

nuclear power program,

said Dominique Lagarde,

director of EDF’s nuclear

engineering division,

Parkiet reported. PGE

recently invited all

potential partners for

talks on the current

assumptions for the

project. ●

Abbey House ....................10

Abercrombie & Fitch ........14

Acer ..................................31

Acteeum Central Europe..13

Alior Bank ..........................4

American Eagle

Outfitters ..........................14

Biedecki ..............................6

BPH FIZ ............................22

BRE Bank..........................21

Budimex..............................2

Carlo Tassara Group ..........4

Case Tech..........................22

CBRE ........12, 13, 14, 17, 22

CBRE Global Investors ....13

CFE Polska ......................13

Colliers International 18, 22

Cushman & Wakefield13, 22

DCT Gdaƒsk ......................16

DLA Piper..........................20

Dom Maklerski Citi

Handlowy ............................4

EBRD ..................................2

EC Harris ..........................20

ECE Projektmanagement

Polska ..............................12

EDF ....................................2

Equity Holding ....................5

Ernst & Young Corporate

Finance ............................20

Gadu-Gadu..........................5

Gaz-System ........................2

Ghelamco Poland ............16

Goodman ....................16, 22

GreenWings Offices ..........13

GTC....................................14

Handlowy ..........................28

HSBC ..................................8

Immofinanz Group............12

ING Securities ....................4

JEMS Architekci................13

Jones Lang

LaSalle ..................14, 17, 22

Karmar..............................21

Kernel ..............................28

KGHM................................28

KR Group ..........................19

Kulczyk Silverstein

Properties ........................19

Meble Emilia ....................19

Multi ..................................14

NAI Estate Fellows ..........13

Naspers ..............................5

OKRE Development ..........13

ORTIS ................................12

P.A. Nova ..........................14

PBG ....................................7

Peakside Polonia

Management ....................12

Peter Nielsen & Partners ..6

PGE ................................2, 7

PGNiG ................................7

PKO ..................................28

Poczta Polska ..................13

Polenergia ..........................7

Polimex-Mostostal ............7

Polish Energy Partners ......7

Polski Holding

NieruchomoÊci ................13

Rafako ................................7

REM II................................23

Robyg ................................12

Ronson Development ......21

Samsung ..........................31

SSW ..................................13

TVN....................................28

VGP....................................14

Victoria’s Secret................14

Volvo ....................................4

Warsaw Stock Exchange ..21

Warszawski Holding

NieruchomoÊci ................13

Weng Fine Art ..................10

Westdeutsche

ImmobilienBank ..............12

X-Trade Brokers ..........8, 28

Yelp ....................................5

Tensions have escalated

between Syria and Turkey fol-

lowing a mortar strike

launched from Syria that killed

five Turkish civilians in a resi-

dential district of the south-

eastern Turkish town of

Akcakale. Turkey’s armed

forces responded by firing on

military targets inside Syria,

while also deploying troops

near the border.

The original incident,

which claimed the lives of a

woman and four children, has

raised the specter of a wider

conflagration that could force

the US to deploy troops in the

already volatile region. Fur-

ther mortar rounds were later

fired from Syria into Turkey,

with no casualties reported.

“We hope that this doesn’t

escalate into a broader

conflict; we hope that

the situation de-esca-

lates,” Pentagon press

secretary George Little

said during a news con-

ference.

The shelling “consti-

tutes a cause of greatest

concern for, and is strong-

ly condemned by, all

allies,” NATO ambassa-

dors said in a statement

drawn up during an emer-

gency meeting held at the

behest of Turkey, a NATO

member.

“The alliance continues

to stand by Turkey and

demands the immediate cessa-

tion of such aggressive acts

against an ally, and urges the

Syrian regime to put an end to

flagrant violations of interna-

tional law,” the statement

added.

The meeting was held

under Article 4 of the NATO

charter which deals with situa-

tions where one member state

feels its territorial integrity,

political independence or

security is under threat.

NATO defense ministers

are due to meet in Brussels

this week, where they are

expected to discuss the Syria

question. Being an Article 4

matter, it remains on the

alliance’s agenda.

Syrian authorities have said

they are investigating the

source of the mortar fire, and

have offered their condo-

lences to the family of the

deceased, according to the

state-run Syrian Arab News

Agency. Terrorist groups have

been suggested as a source of

the mortar fire. Some

observers say it may have been

an accident.

In line with NATO’s state-

ment, Poland’s Ministry of

Foreign Affairs condemned

the strike, saying that Poland

expresses its full solidarity with

Turkey.

“We would like to empha-

size strongly that the violation

of another state’s territorial

integrity is inadmissible,” said

ministry spokesperson Marcin

Bosacki.

Poland, itself a NATO mem-

ber, called on Syrian authorities

to adhere to international law

and to take appropriate meas-

ures to restore security along

the Syrian-Turkish border, in

line with the NATO statement.

The Syrian regime is trying

to quell an uprising against the

government of President

Bashar al-Assad, with bloody

consequences.

Poland’s Ministry of For-

eign Affairs has helped organ-

ize a total of three evacuations

from Syria in recent months,

with the latest involving three

Polish citizens. GGaarreetthh PPrriiccee

z∏.11.5 billion is the value of PGE’s flagship energy investment inOpole. The company decided to continue the projectdespite the protests of activists who took the case to

court.

122,000 is the number of Poles living in Ireland, the Irishcentral statistics office reports, making them the

largest minority group in the country.

z∏.10.45 billionis how much the state budget would make per year if

all long-term unemployed were able to find jobs.

12.5-12.6% was the unemployment rate in September, according

to Deputy Labor Minister Jacek M´cina.

“I have the impression this is a matrix.”Ma∏gorzata Kidawa-B∏oƒska, deputy leader of Civic Platform’s parliamentaryclub, commenting on the decision of opposition Law and Justice to announcetheir candidate for PM three years away from parliamentary elections.

Quote of the Week

Turkey strikes back at SyriaThe Turkish parliament has given the country’s governmentthe approval to go to war. As it seeks to retaliate for the killingof its citizens in a mortar attack launched from Syria, ten-sions are escalating in the already volatile region. Log on toWBJ.pl to read an analysis by Stratfor on how the conflictmight develop and whether war is the likeliest outcome.

On WBJ.pl

Numbers in the News

Company index

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8-10 EXPO REAL 2012 Event: This commercial real estate trade fair – one

of the biggest in Europe – focuses on net-working, market orientation and cultivatingvaluable business contacts. Across the64,000-sqm site, 1,610 exhibitors presenttheir real estate product portfolios.

Location: Messe München, MunichWeb: Exporeal.net

10-11 INTERNATIONAL FORUM ON PUBLIC-PRIVATEPARTNERSHIPS

Event: Organized by the British Polish Chamber ofCommerce, this event will focus on interna-tional, municipal and regional infrastructure.

Location: Column Hall of the Ministry of Economy, PlacTrzech Krzy˝y 3/5, Warsaw

Web: bpcc.org.pl

16 YOUNG ART AUCTIONEvent: This auction of a diverse set of works

includes both well-known young artists anddebutantes, who have graduated from fineart academies in recent years. Ninety-eight

selected works by young painters will beauctioned. The starting price of each isz∏.500.

Location: ul. Marsza∏kowska 34-50, WarsawWeb: desa.pl

24-28 FASHIONPHILOSOPHY Event: FashionPhilosophy Fashion Week Poland is

the biggest fashion event in the region, sayorganizers. This event will presentSpring/Summer 2013 trends.

Location: ¸ódêWeb: fashionweek.pl

25 OFFICE BUILDINGS IN POLANDEvent: This 5th edition of the conference, organized

by Nowy Adres, will feature over 30 expertspeakers, as well as a number of lecturesand panel discussions. It promises to be agreat meeting opportunity for senior man-agement of companies in the Polish officemarket.

Location: Warsaw Marriott HotelWeb: konferencje.nowyadres.pl/office-buildings-in-

poland.php

October

DATELINE

Turkey-Syria border tensionIN THE SPOTLIGHT

Figures in focusService economiesPercentage of labor force employed in the market servicesindustry in 2011, selected EU27 countries

Source: Eurostat

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President Bashar al-Assad of Syria

OCTOBER 8-14, 2012 NNEEWWSS www.wbj.pl 3

Politics

PiS announces candidate for PMElections are in threeyears, but that isn’tstopping Poland’slargest oppositionparty from trying tooust Donald Tusk

Opposition party Law and Jus-

tice (PiS) has announced Piotr

Gliƒski, a sociology professor

previously unknown to most

political observers, as its candi-

date for prime minister of a

technocratic government the

party says Poland now needs.

“We have a situation which

demands change … [The situa-

tion] demands creating a non-

parliamentary government,”

said PiS leader Jaros∏aw

Kaczyƒski while introducing Mr

Gliƒski to the public.

PiS has said it will initiate a

no-confidence vote against

Prime Minister Donald Tusk

and his government. The next

parliamentary elections are

scheduled in 2015.

Meanwhile, Mr Gliƒski

pointed to five issues his gov-

ernment would tackle immedi-

ately. Top of the list would be

replacing the “ineffective” gov-

ernment of Donald Tusk with a

technocratic government, then

immediately implementing

decisions to counter the eco-

nomic and social crisis, improv-

ing public administration, pre-

senting a vision and strategy for

Poland’s development and

changing the “style” of politics

in government.

“We must not only deal with

the crisis. We must change

Poland,” said Mr Gliƒski.

But in order to get rid of Mr

Tusk, PiS would need the sup-

port of all the other opposition

parties in parliament, as well as

the votes of four MPS in the

current ruling coalition.

A ‘joke’However, Janusz Palikot,

leader of the third-largest party

in parliament, has dismissed the

idea off-hand, calling Mr Gliƒs-

ki’s candidacy a “joke.” The rul-

ing party, Civic Platform (PO)

reacted in similar fashion.

“Professor Gliƒski now

believes he can be prime minis-

ter despite a stable coalition

that has a parliamentary major-

ity. I have the impression this is

a matrix,” said Ma∏gorzata

Kidawa-B∏oƒska, deputy leader

of PO’s parliamentary club.

The Gliƒski candidacy is

widely perceived as part of what

PiS has dubbed its “autumn

offensive.”

This week, the party was

scheduled to hold a debate on

the condition of the health care

sector in Poland. Two weeks

ago it organized a debate on the

challenges facing Poland’s

economy. The latest TNS Pols-

ka voter poll had PiS with 39

percent support and PO at 33

percent.

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PiS’s candidate for Prime Minister, Piotr Gliƒski

The economy

Finance minister seessignificant rebound in 2014But Jacek Rostowskiexpects the next twoyears to be tough forthe Polish economy

Finance Minister Jacek Ros-

towski has said there is “every

reason to believe” that the

years 2014-2015 will be better

for Europe and should usher

in a “significant rebound” for

the Polish economy. The

finance minister made the

comments at an economic

debate organized by the oppo-

sition Democratic Left

Alliance (SLD) party.

“We will have a tough 2012

and a tough 2013, with a signif-

icant slowdown, we are aware

of this,” said Mr Rostowski

before making his more opti-

mistic forecast for the subse-

quent years.

However, economists say a

lot depends on how the word

“significant” is defined in this

context, and how the global

economic crisis plays out.

Witold Or∏owski, chief eco-

nomic advisor at PwC, who

was also at the debate, said it is

“unlikely that Polish GDP

growth will return to 5-7 per-

cent if Western Europe does

not solve its problems.”

Mr Or∏owski, who also

serves on the economic coun-

cil which advises Prime Minis-

ter Donald Tusk, said the way

Poland is handling economic

problems during the crisis is a

“miracle.”

He also said that Poland,

paradoxically, had done more

catching up with the West in

the recent years of crisis than

during any other period in its

post-communist history. “We

have been developing slowly

while they have regressed,” he

said.

Mr Or∏owski sees four

major issues that need urgent

reform in Poland: public serv-

ices like education and health-

care, public administration

and the justice system,

Poland’s business climate and

a rethink of the country’s role

in Europe.

Meanwhile, SLD leader

Leszek Miller, who hosted the

debate, was categorical on

where his party stands regard-

ing the economy. “No to

democracy in accordance with

the market, yes to the market

in accordance with democra-

cy,” said the SLD leader dur-

ing the debate.

Mr Miller said it was

important to find a “new com-

promise between the rationali-

ty of the markets and the

rationality of societies which

are finding it increasingly diffi-

cult to accept the constant

belt-tightening.”

RReemmii AAddeekkooyyaa

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Mr Rostowski expects 2012 and 2013 to be “tough”

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The automotive giantplans to shutter itsplant in Säffle due tolow demand in Europe

Automotive company Volvo

plans to close its bus manufac-

turing facility in Säffle, Swe-

den and concentrate produc-

tion at its main plant in

Wroc∏aw, western Poland.

Volvo says its decision to

increase bus production in

Poland comes as a result of

low demand and strong com-

petition in Europe. Production

in Säffle will cease at the end

of June 2013, provided that

negotiations with unions are

completed in time.

The move will affect 330

permanent employees and

some 60 consultants.

“The demand for new

buses in Europe has dropped

steadily over the past few

years, paralleled by consider-

able pressure on prices, partic-

ularly in the Nordic markets,”

Hakan Karlsson, president of

Volvo Bus Corporation, said in

a statement.

“By concentrating the pro-

duction of complete buses in

one single plant, we can reduce

our costs and thus reverse our

negative profitability trend,”

he added.

Volvo Buses predicts that

volume growth in Europe will

remain low in the coming years

and that price pressure will

continue, the company wrote.

By focusing all production

on the much larger plant in

Poland, it expects to achieve

the economies of scale “that

are essential in order to tackle

the increasingly tough compe-

tition on the market.” The

plant in Poland has four times

the capacity of the one in Säf-

fle.

Local media report that the

plant in Wroc∏aw, which has

until this point operated at half

capacity, will now see an

increase in production vol-

umes, although headcount is

not expected to increase from

the current level of 1,550. The

company could not be reached

for comment.

Volvo Group’s operating

profit in the fourth quarter of

2012 is expected to take a hit of

about 100 million kronor if

production is relocated accord-

ing to schedule.

GGaarreetthh PPrriiccee

OCTOBER 8-14, 2012BBUUSSIINNEESSSS4 www.wbj.pl

Bus manufacturing

Volvo to move bus productionfrom Sweden to Wroc∏aw

Banks

AAlliioorr BBaannkk mmuullllss IIPPOOaass ssaallee ttaallkkss ssttaallll

Alior Bank is no closer to find-

ing a buyer, though bids were

due on September 7, local

media reported last week, and

the lender is now considering

listing on the stock exchange.

Business daily Parkietreported that Alior’s owner,

Italy’s Carlo Tassara Group,

expects some z∏.4 billion

(about €1 billion) for the bank.

However, none of the potential

buyers, mostly private equity

funds, were willing to offer that

much, the newspaper said.

When WBJ contacted Alior

to ask about the reports, the

firm’s spokesperson, Dariusz

Kozdra, said, “The bank is tak-

ing all possible development

scenarios in the future into

consideration, but no decisions

have been made as of yet.”

Analysts said the offers for

the bank are lower than Carlo

Tassara expects because of

unfavorable market condi-

tions.

“Alior could be considering

an IPO because they need cap-

ital to fund further growth and

the main shareholders may

want the IPO,” said Andrzej

Powier˝a, an equity analyst at

brokerage house Dom Makler-

ski Citi Handlowy.

Another factor that could

potentially push the bank

towards an IPO is the strong

opposition of Poland’s finan-

cial market regulator, the

Financial Supervision Auth-

ority, to private equity funds

becoming major stakeholders

in banks.

“The problem with private

equity funds is that they have

a limited knowledge about

the banking business so they

don’t provide the know-how

which is invaluable for strate-

gy,” said Piotr Palenik, bank-

ing sector analyst at ING

Securities.

IIzzaabbeellaa DDeeppcczzyykk

Potential buyers are offering less than theasking price, leading Alior to consider an IPO,local media report

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The Wroc∏aw plant has four times the production

capacity of Volvo’s facility in Sweden

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Unfavorable market conditions have led to

disappointing offers for Alior Bank

The Polish instantmessagingservice hasincurredsubstantiallosses in thepast fewyears

The owner of Pol-

ish instant messag-

ing service Gadu-

Gadu has laid off a large

number of employees,

according to daily Puls Biznesu.

The company underwent a

deep restructuring last week,

and from a team of 300 only 60

employees are left, the news-

paper wrote without citing its

sources.

“We have made a lot of

changes as a result of the eco-

nomic slowdown and the wors-

ening situation on the advertis-

ing market, and [with changes]

come layoffs,” said Jaros∏aw

Rybus, Gadu-Gadu’s spokes-

person. He did not confirm the

actual number of employees

who were made redundant.

The company has been

experiencing financial trou-

ble ever since 2009, when it

reported losses of z∏.6 million.

Gadu-Gadu, which now is

officially called GG, was

launched in 2000. Its creator

was ¸ukasz Foltyn, and the

project was financed by Equity

Holding. Equity Holding

made the company public, and

then sold it to Naspers. To this

day GG is the leader in the

Polish instant messaging mar-

ket, through which hundreds

of thousands of instant mes-

sages are sent daily.

IIDD

Web-based business

YYeellpp eenntteerrss PPoolliisshh mmaarrkkeett The company wants togain a strong footholdbefore it startsthinking aboutmonetizing its onlinedirectory service

Yelp, an online city guide that

helps connect consumers with

local businesses, began operat-

ing in Poland last week.

Founded in the US in 2004,

Yelp is an online directory of

local businesses such as restau-

rants, shops, bars, and other

service outlets that gives mem-

bers the opportunity to rate

and review the places they

visit. Yelp has 78 million

online visitors every month.

From last week, Poles have

been able to register at

Yelp.pl, as well as download it

as an app for iPhones and for

Android-operated cell phones.

Yelp’s new markets vice

president Miriam Warren said

that entering Poland was a nat-

ural choice, considering that

Poland has relatively high eco-

nomic growth, and has avoid-

ed falling into recession

despite the ongoing global

economic slowdown.

“The industriousness of the

Polish people, their openness

to new technologies as well as

the fact that there isn’t anoth-

er site like this [in Poland],

were our reasons for entering

the Polish market,” she added.

Development firstAlthough in the US, the UK,

Canada and Ireland, business-

es are able to advertise on

Yelp, this will not be possible

in Poland right away, since the

company’s priority is not to

monetize but to develop the

service.

“Our real focus here in

Poland for the near future is to

create the best local guide –

and it is tough to give a date

for now when we will start to

sell. It is not going to be any

time soon,” Ms Warren said.

Analysts are skeptical about

the possibility of the service

meeting with success in Poland.

“The problem with foreign

online services is that they

wrongly assume that if a serv-

ice worked in their country, all

they need to do is translate it

and it will be a success else-

where,” said Sylwester Kozak,

an IT market analyst at portal

e-biznes.pl. “Take for example

the complete failure of eBay in

Poland,” he added.

Moreover, Yelp will not

have an office in Poland,

meaning its knowledge of the

local market is likely to be lim-

ited, Mr Kozak said.

He explained that if such a

firm doesn’t have a base in the

country in which it is present,

then it is less likely to be suc-

cessful because it will be less

able to understand what

appeals to local internet users.

He added that what deter-

mines the success of such a

portal is its marketing, and so

far Yelp hasn’t been advertised

at all.

Poland is the 18th country

that Yelp is entering and the

first CEE country in which the

service has been made avail-

able. IIzzaabbeellaa DDeeppcczzyykk

OCTOBER 8-14, 2012 BBUUSSIINNEESSSS www.wbj.pl 5

Instant messaging

Gadu-Gadu carriesout large-scalelayoffs: daily

Everybody would like to pay less

taxes. However, investors that have

decided to conduct business or spe-

cific projects in Poland through a

limited joint-stock partnership

(“LJSP”) to optimize their taxes

now have a tough nut to crack.

Currently, just as every other

partnership type in Poland, LJSPs

do not pay a corporate income tax

(“CIT”), like capital companies do.

Their profits are taxed only when

they are distributed to partners or

shareholders. However, this may

soon change, as the Ministry of

Finance has proposed legislation

which, if it comes into force, will

turn taxation rules applicable to

LJSP upside down.

Profits taxed twiceAccording to the Ministry of

Finance’s draft legislation, dated

August 24, 2012, LJSPs will be

equated with the capital companies

in the way they are taxed. As a

result, LJSPs’ profits will, in effect,

be taxed twice.

Firstly, the LJSP itself will pay

CIT from retained earnings.

Secondly, each partner or share-

holder of the LJSP will pay tax indi-

vidually upon any payment of a div-

idend made from the LJSP’s profit

(already taxed by CIT). The am-

endment is very likely to come into

force as of January 1, 2013.

Under the proposed new rules,

LJSPs will have to pay advance CIT

payments towards their profits. This

may affect the liquidity of LJSPs and

reduce their ability to make invest-

ments. Currently, advance payments

are neither applicable to LJSPs, nor

to their partners or shareholders.

The new taxation rules will apply to

all LJSPs, including those whose

financial year does not correspond

to the calendar year. As a result,

they would be forced to close their

accounting books on December 31,

2012 and start a new financial year

from January 1, 2013.

Other benefitsThis all begs the question: Will

LJSPs stand the test of time or will

they vanish from the market? Just as

a reminder, LJSPs were introduced

to the Polish legal system in January

1, 2001. More than 2,000 LJSPs

have been incorporated to date, and

this number has been increasing at a

rate of about 40 percent per year

starting from 2010. However,

regardless of the tax issues, there are

more reasons for the popularity of

this form of partnership.

First of all, LJSPs, as a form of

partnership, have many elements in

common with capital companies.

This allows the partners/shareholders

to combine advantages of both forms.

The general partners of an LJSP are

jointly and severally liable without

limitation for the debts and obliga-

tions of the partnership; they repre-

sent the partnership and manage its

affairs, just as partners in registered

partnerships.

However, shareholders are not

liable for any obligations of the

partnership and their liability is

limited only to money they

brought to the partnership in

return for shares. Furthermore,

LJSPs facilitate fund-raising from

a large number of investors,

including small and anonymous

ones, since they may issue shares

in exactly the same manner as a

joint-stock company. They may

also go public by offering shares to

the stock market.

Next stepAt least a few options are possible

for businesspeople. They can main-

tain their LJSP, which will be less

attractive than other forms of part-

nership from the taxation point of

view, but still combines advantages

of a partnership and a capital com-

pany. They can transform its busi-

ness into a capital company to

make full use of its tools and pay

tax according to the same rules as

will most likely applicable for

LJSPs from January 1, 2013.

Or, if they really want to pay less

taxes, they can transform the

LJSP’s business into a limited part-

nership to avoid payment of CIT.

After all, a limited partnership’s

flexibility enables it to form a tai-

lored-fit structure with profit shar-

ing and limitation of liability, some-

what resembling an LJSP, without

any prejudice to taxation rules cur-

rently applicable to all partner-

ships. ●

OCTOBER 8-14, 2012LLAAWW6 www.wbj.pl

Contact: Miros∏aw Stefanik

ms@pnplaw.pl

Legal News

BROUGHT TO YOU BY PETER NIELSEN & PARTNERS LAW OFFICE

Waste management rulesOn October 2, the government adopteda draft of a new act on managing pack-aging and packaging waste. With someexceptions, the provisions of the actcover all packaging introduced to thePolish market (regardless of the type ofmaterial) as well as the waste createdby such packaging. The act will not beapplicable to products in packagingimported to Poland and in the sameyear exported out of the country. At thesame time, companies that producepackaging weighing up to 1,000 kg peryear will be released from the obliga-tion of recovering and recycling a cer-tain level of waste.

Moreover, financial penalties will beintroduced, from z∏.5 up to z∏.500,000,for violating provisions of the act. Thegovernment assumes that thanks tothe new regulations, the number ofentrepreneurs fulfilling their duties withregard to recycling and recovery willincrease.

If a national holiday falls ona day off, additional time offis dueOn October 2, 2012 the ConstitutionalTribunal recognized the application ofthe National Commission of NSZZ Soli-

darnoÊç (a trade union) and decidedthat art. 130 § 21 of the act of June 26,1974 (the Labor Code), was inconsis-tent with art. 32 item 1 of the constitu-tion (case file no. K 27/11).

Starting from January 1, 2011 theabove-mentioned provision of theLabor Code was used by the govern-ment as the basis of a law whichdenied employees a compensatory dayof leave for any national holiday whichfell on a day that was already free fromwork. The Tribunal claims that the legis-lator re-established Epiphany as anadditional day statutorily free fromwork. At the same time, however, itdenied employees a day off in obser-vance of a national holiday, if thatnational holiday fell on a day that wasalready free from work, depending onthe work schedule of a given employ-ee.

The Constitutional Tribunal foundthat this violated the rule of equal treat-ment, because some employees havedays off work between Monday and Fri-day. Previously, all employees in Polandwere entitled to take a day off in obser-vance of a national holiday, if the holi-day fell on a day free from work.

The decision is final and it will beannounced in the Journal of Laws. ●

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Black clouds over limited joint-stock partnershipsLegal Forum

Legal Forum is a paid-for module which gives law firms in Poland an opportunity to discuss and inform readers about important developments in the market. The content is created in consultation with Warsaw Business Journal's editorial staff.

OCTOBER 8-14, 2012 EENNEERRGGYY www.wbj.pl 7

Kulczyk acquires wind energy

firm for over z∏.400 millionPolenergia, a firm controlled by

Jan Kulczyk, Poland’s richest

man, has purchased a 58 per-

cent stake in wind energy hold-

ing company Polish Energy

Partners (PEP) in a deal worth

z∏.406 million.

Polenergia had earlier

hoped to buy 80 percent of PEP

– for over z∏.700 million – in

order to allow it to delist the

company, Reuters reported.

But Mr Kulczyk’s firm failed to

persuade the required number

of PEP shareholders to relin-

quish their stakes.

“Buying a 58 percent stake

gives us control and assures the

possibility of realizing our strat-

egy,” the Polish Press Agency

quoted Polenergia CEO Dar-

iusz Mioduski as saying. He

added that the company is not

planning to launch a bid for the

remaining PEP shares.

PEP is at the head of a capi-

tal group which produces elec-

trical energy in wind farms. It

operates wind farms with an 80

megawatt (MW) capacity and

plans to increase that to 100

MW next year.

After the announcement of

the deal, Polenergia released a

statement saying that it had

“achieved [its] goal” with the

purchase. “We will have a deci-

sive voice in the activity and the

development of the company,”

the statement read.

Before the transaction went

through, Polenergia Holding

had to apply for the approval of

Poland’s consumer watchdog,

the Office of Competition and

Consumer Protection, which it

has now received.

RRAA

Economy Ministry to forcePGNiG to sell 30 percent ofgas on new exchangePoland’s Economy Ministry

will order gas monopoly

PGNiG to offer 30 percent of

its sales on the country’s

planned gas exchange in an

effort to speed up the liberal-

ization of the gas market,

Reuters reported last week.

The legislation that would

usher in the changes is expect-

ed to be accepted by the Pol-

ish government by October

17. The European Commis-

sion has threatened to fine

Poland up to €270,000 next

year if it does not liberalize

gas prices, which are capped

by the Energy Regulatory

Office.

PGNiG, which is a state-

controlled firm, sells nearly all

of the gas available in Poland.

Seventy percent of the gas

goes to industry and the rest

to individual customers.

Poland plans to establish

the gas exchange before the

end of the year and to address

the EC’s complaints by weak-

ening the dominant position

of PGNiG in the market,

where demand totals more

than 14 billion cubic meters.

After the legislation is

accepted by the government it

will go on to parliament for

approval, where it is expected

to pass without difficulty.

RRAA

Power-plant construction

Renewed PGE projectis lifeline to firmsPoland’s largest utilitywill move forward witha project that will givetwo troubled firms alift

Energy group PGE has

announced that despite envi-

ronmental activists’ protests, it

will carry on with an z∏.11.5 bil-

lion investment in the south-

ern Polish city of Opole. The

investment, for the construc-

tion of coal-fired power units,

could help save troubled Pol-

ish builders Polimex-Mostostal

and PBG, who have incurred

huge losses as a result of their

involvement in infrastructure

projects for this year’s Euro

2012 soccer tournament.

The announcement came

after Poland’s Supreme

Administrative Court (NSA)

overturned a previous order to

halt the construction of the

two 900MW units for PGE’s

Elektrownia Opole power

plant and sent the case back

for retrial.

A consortium led by PBG

subsidiary Rafako won the

tender for the construction of

the coal power units, only to

have activists appeal against

the investment’s environmen-

tal permits. Rafako is a boiler

manufacturer and a key part

of the PBG group, which was

the main contractor for

Poland’s National Stadium

and is now facing bankruptcy.

The firm had a z∏.1.6 billion

net loss in the first half of 2012.

The fact that PGE has now

said it will move forward with

the construction is welcome

news for the firms involved in

the project, not only for

Rafako and PBG but also for

Polimex-Mostostal, which suf-

fered a z∏.389 million net loss

in Q2 of this year and was also

rumored to be facing bank-

ruptcy.

ClientEarth Poland, the

foundation that has been

blocking the investment, has

already announced it will con-

tinue to oppose PGE’s project

in Opole. The next round in

the battle will take place in the

voivodship administrative

court, which has said it will

take on the case no sooner

than January. RReemmii AAddeekkooyyaa

SH

UT

TE

RS

TO

CK

Environmentalists vehemently oppose the

construction of the coal-fired units

OCTOBER 8-14, 20128 www.wbj.pl FFIINNAANNCCEE && EECCOONNOOMMIICCSS

Industrial output

Manufacturing outputcontinues to fall sharplyPolish factories arepulling back as neworders slump

Poland’s manufacturing PMI

dropped to 47 points in

September, its worst reading

since the height of the crisis in

Poland – July 2009 – as the

country’s economy continues

to show signs of a sharp slow-

down.

The fall to crisis-period

lows is “a negative surprise

even compared to already neg-

ative expectations,” said Agata

Urbaƒska, an economist for

Central & Eastern Europe at

HSBC, in an e-mailed state-

ment.

The PMI measures the per-

formance of the manufactur-

ing sector, and anything below

a score of 50 indicates contrac-

tion. HSBC and Markit, the

companies that compile the

survey, found that output, new

orders and backlogs all

declined at faster rates than in

August, while employment in

the sector fell for the first time

since March.

The report that the compa-

nies issued along with the

release of the figures made for

some ugly reading. “Inflows of

new orders deteriorated more

sharply in September. The vol-

ume of new work has declined

every month since February,

and the rate of contraction in

the latest period was the steep-

est since June 2009. New

export business declined for

the sixth successive month,

with the pace unchanged for

the second period running,” it

read.

Output has fallen every

month since May. In Septem-

ber, new orders dropped

sharply, the report found,

prompting manufacturers to

work through their backlogs

rather than produce more.

“This reading follows

below-expectation industrial

production growth in August

and feeds expectations for

this growth rate turning neg-

ative in September as fore-

cast by the economy min-

istry,” said Ms Urbaƒska.

“[T]he leading indicators

domestically and abroad,

among them PMI, still give

no indication of the econom-

ic slowdown bottoming out

in the near future,” she

added.

AAnnddrreeww KKuurreetthh

45

50

55

Sep. '1

2Aug

. '12

Jul. '12

Jun. '1

2May

'12Ap

r. '12

Mar. '12

Feb. '1

2Jan

. '12

Dec. '11

Nov. '11

Oct. '11

Sep. '1

1

*

Producing worryPoland’s manufacturing PMI, September 2011-September 2012

Source: Markit, HSBC

*Anything above 50 indicates expansion, below 50 indicates contraction

Interest rates

NBP surprises, holds main interest rate steadyAnalysts now expect arate cut in November

In a decision that surprised the

market, the National Bank of

Poland’s interest-rate setting

Monetary Policy Council

(RPP) decided to leave its

main interest rate unchanged

at 4.75 percent last Wednes-

day.

In recent weeks there has

been a parade of macroeco-

nomic figures showing that

Poland’s economy is in slow-

down mode. Just last Monday,

Poland’s manufacturing PMI

reading dropped to 47, its low-

est since the height of the crisis

in Poland, in July 2009.

Taking the slowdown into

account, most analysts had

expected the RPP to lower

rates by 25 basis points.

After it was announced

rates would be left on hold, the

z∏oty gained against major cur-

rencies.

The decision was a bigger

surprise than the one the RPP

made in May, when it decided

to raise rates by 25 basis

points, Przemys∏aw Kwiecieƒ,

chief economist at X-Trade

Brokers said in an e-mailed

statement in reaction to the

decision. He titled his report

“The council from another

world,” referring to the

Monetary Policy Council.

“There is now hard evi-

dence [of a slowdown in

Poland],” he wrote, “but the

council continues to wait.”

It a statement released

with the announcement, the

NBP indicated that it left

rates on hold because infla-

tion remains at 3.8 percent,

well above its target of 2.5

percent.

The statement had a most-

ly dovish tone, however, and

analysts now expect the RPP

to cut rates by 25 basic points

at its November meeting.

AAnnddrreeww KKuurreetthh

Oct. '12

Sep. '1

2Aug

. '12

Jul. '12

Jun. '1

2May

'12Apr

. '12

Mar. '12

Feb. '1

2Jan

. '12

Dec. '11

Nov. '11

Oct. '11

Sep. '1

1Aug

. '11

Jul. '11

Jun. '1

1May

'11Apr

. '11

Mar. '11

Feb. '1

1Jan

. '11

Dec. '10

Nov. '10

Oct. '10

3.0

3.5

4.0

4.5

5.0

Still on holdPoland's reference interest rate, October 2010 to October 2012 (%)

So

urc

e:

Na

tio

na

l B

an

k o

f P

ola

nd

OCTOBER 8-14, 201210 www.wbj.pl AARRTT IINN FFOOCCUUSS

Art market

PPoollaanndd’’ss aarrtt mmaarrkkeettsseett ffoorr rreennaaiissssaannccee

Though still anabstract concept formany Poles, investingin art is growing inpopularity

Investing in art is still a rela-

tively new concept in post-

communist Poland, but

experts who gathered at last

month’s International Art

Industry Forum in Vienna

agreed that it is quickly

becoming a popular form of

investing money and diversify-

ing portfolios among the coun-

try’s affluent.

Poland’s art investment

market is nevertheless still in

its “early stages,” said Jakub

Kokoszka, president of the

board at auction house Abbey

House, and a guest speaker at

the Vienna forum.

Its fledgling nature is due

to Poland’s tumultuous history

and stymied economic devel-

opment – factors which mean

there has been little money

spent on educating people

about the value of art. Conse-

quently, a strong tradition of

collecting artwork has not

developed in Poland.

“There is no deeply rooted

collecting habit in Poland as

there is in Austria, for exam-

ple,” said Sergey Skater-

schikov, CEO of Skate’s Art

Market Research.

In addition, the customer

base for artwork is small, and

“their pockets are not so

deep,” said Andras Szanto,

curator of the International

Art Industry Forum in New

York.

Moreover, with some not-

able exceptions, Polish art is

not well known among wealthy

international investors.

“International investors,

those who can afford the more

expensive pieces, tend to look

first to artists they know, to

those who have the backing of

established galleries and art

institutions,” he added.

Growth in storeNevertheless, the Polish art

market has been growing

quickly of late. Turnover on

Poland’s art auction market

increased 90 percent, from

z∏.15.8 million in the first half

of 2011, to z∏.30.1 million in

H1 2012, according to a report

by Abbey House.

Mr Szanto said that there is

more growth in store, while

other experts said that

Poland’s art market is one of

the fastest growing in Central

and Eastern Europe.

“The Polish market has

more momentum than the

Hungarian or the Czech art

markets for example,” said

Christian W. Roehl, superviso-

ry board member of German

art dealer Weng Fine Art.

Poland’s relatively strong

economy is helping underpin

this growth.

“Poland is one of the most

interesting economies in

Europe these days. I happen

to manage money out of Lux-

embourg and [when it comes

to stocks] … Poland is our sec-

ond priority market after Ger-

many in terms of value and

growth that we see there,” said

Mr Skaterschikov.

He added that Poland’s art

market shouldn’t in fact be

put in a basket with its CEE

peers, but should instead be

compared with those in

Western Europe.

“Art is the most popular

alternative asset group, as

investing in art is motivated

by the need to secure capital

from the crisis,” said Maciej

Gajewski, an art market ana-

lyst at Abbey House.

“The crisis has given impe-

tus to the global art market,

and Poland is beginning to

reflect this trend,” he added.

IIzzaabbeellaa DDeeppcczzyykk

SH

UT

TE

RS

TO

CK

Turnover on

Poland’s

art auction

market

(z∏. mln)

Increase

of 90%

Source: Abbey House

OCTOBER 8-14, 2012 OOPPIINNIIOONN && AANNAALLYYSSIISS www.wbj.pl 11

Nobody can accuse Poland’s largest opposi-

tion party of sitting back lately.

Two weeks ago, it organized a much-publi-

cized debate to discuss Poland’s economic

problems. Then it spent the next few days ener-

getically lambasting Prime Minister Donald

Tusk for “mishandling” the aftermath of the

2010 Smolensk airplane catastrophe, in which

President Lech Kaczyƒski and 95 others died.

On September 29, it organized a protest

march involving anything from 50,000 to

100,000 people, along with the controversial but

influential Father Tadeusz Rydzyk and the leg-

endary Solidarity trade union.

Last Monday, PiS unveiled its surprise can-

didate for prime minister, Piotr Gliƒski, a soci-

ology professor who is not a member of the

party. This came despite the fact that elections

are three years away.

Party leader Jaros∏aw Kaczyƒski now says

his party will soon initiate a no-confidence

vote against Mr Tusk and announce its shadow

cabinet.

Meanwhile, this week, PiS was scheduled to

host another debate, this time on the condition

of the health care system, a topic which no

doubt concerns millions of Poles.

Is all this having any effect? A TNS Polska

poll taken at the beginning of October showed

PiS with 39 percent support while the ruling

Civic Platform (PO) was backed by 33 percent

of the Polish electorate.

PO backers in the media are now blasting it

for “sleeping”while PiS runs riot.

It will of course take a few more polls to con-

firm if PiS can indeed overtake PO in the longer

run.

PiS, the trendsetter?But other opposition parties clearly envy the

media attention PiS has been receiving. In fact,

the Democratic Left Alliance (SLD) shame-

lessly copied its idea, organizing its own eco-

nomic debate last week.

PiS, supposedly the old-fashioned party out

of place in today’s politics, is now playing the

role of trendsetter?

As for Mr Gliƒski, he must know he won’t

become PM. And so does PiS. But his candida-

cy could benefit the party politically.

Mr Kaczyƒski knows that although he has

guru-like status among his supporters (roughly

a third of the electorate), the rest of the country

doesn’t think much of him, evidenced by popu-

larity polls.

He thus seems to be saying to Poles: “Don’t

worry, even if my party wins, you won’t have me

as prime minister.”

This could, in theory, help PiS during the

next parliamentary elections by weakening

turnout for PO, which wins elections largely on

the anti-Kaczyƒski vote, not because it is itself

overly popular.

Also, PiS is often derided as the party of the

uneducated and frustrated. Presenting a calm

professor as its candidate for prime minister

could impress some among the conservative-

minded intelligentsia.

Where’s the consistency? Still, there are many “buts” to this plan.

First of all, PiS still makes it too easy for its

political opponents to caricature it, due to radi-

cal moves such as taking part in controversial

marches like that on September 29.

Even conservative-minded intellectuals

must cringe at the sight of Mr Kaczyƒski march-

ing alongside Father Rydzyk, who has made

several public xenophobic and anti-Semitic

statements in the past.

Pop singers need to have a cohesive image;

so do politicians. You can’t be “street” one day

and play posh the next without confusing peo-

ple about who you really are.

Secondly, observing Mr Kaczyƒski leaves

you in no doubt as to his ambitions to play the

alpha male role. Before the 2005 parliamentary

elections he promised that if his brother Lech

was elected president, he would not become

PM even if PiS won the vote.

Both Lech Kaczyƒski and PiS did win. And

although Mr Kaczyƒski initially installed Kaz-

imierz Marcinkiewicz, who was little-known at

the time, as PM, he removed him a year later

and took over. Why should Poles believe this

time will be any different?

That said, PiS does seem to have sharpened

its game recently. That is good, since it should

keep the current government on its toes. But

“believability” is Mr Kaczyƒski’s biggest prob-

lem. Most Poles just don’t believe anything he

does or says. Until Jaros∏aw Kaczyƒski finds a

way to change that, he will remain as far from

the prime minister’s seat as his candidate, Mr

Gliƒski. ●

Remi Adekoya is Warsaw Business Journal’s politics editor.

Read his blog, “The business of politics” on WBJ.pl

Can a hyperactive PiSoverthrow the ruling party?

MANAGING EDITORGARETH PRICE(GPRICE@WBJ.PL)

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PRINT & DISTRIBUTION COORDINATORKRZYSZTOF WILI¡SKI(DYSTRYBUCJA@VALKEA.COM)

BOOK OF LISTS SPECIALISTJOANNA RASZKA(JRASZKA@VALKEA.COM)

PUBLISHER VALKEA MEDIA SAEDITOR-IN-CHIEF ANDREW KURETH (AKURETH@WBJ.PL)MANAGING DIRECTOR MONIKA STAWICKA

Editorials are the opinions of WBJ’s editorial board. Other opinions are those of the authors alone. Comments, opinions and letters should

be sent to editor@wbj.pl. Please include a name and contact information and clearly indicate if they are to be considered for publication.

Should Europe be fracking?The global energy community is abuzz with

excitement about hydraulic fracturing, or

“fracking,” a newish technology that has opened

formerly inaccessible reserves of gas trapped in

underground shale formations. The boom in this

so-called shale gas production has allowed the

United States to become almost self-sufficient in

natural gas.

Europe, by contrast, is clearly lagging. Explo-

ration is proceeding only hesitantly and shale gas

production has not even started.

Critics of Europe’s apparent lack of enthusi-

asm for fracking miss two key points. First,

Europe’s geology is different from that of Amer-

ica. There is a huge difference between potential

deposits hidden somewhere in large shale forma-

tions and recoverable reserves that can actually

be produced economically.

In fact, estimates by the International Energy

Agency suggest that the most significant recover-

able reserves of shale gas are in the US and

China, not Europe. Moreover, even these esti-

mates are really not much more than educated

guesses, because only in the US have shale for-

mations been subject to intense exploration over

a period of decades.

This process is starting in Europe only now.

Poland appears to have Europe’s most favorable

geology, and it might become a significant pro-

ducer on a local scale in about 10 years. This is a

fortunate coincidence, because shale gas produc-

tion would probably make it politically easier to

phase out Poland’s economically and environ-

mentally irrational subsidies to local coal produc-

tion (and consumption).

National authorityBut pro-fracking critics of the European Union

miss a second point: the EU has no authority

over the development of shale gas in Europe.

Licensing and regulation of exploration and pro-

duction are decided at the national level.

While it might be true that Europeans are too

sensitive to environmental concerns, incentives

also play a role. In particular, whereas ownership

rights over natural resources in the US typically

belong to the individual owner of the land under

which the resources lie, in Europe ownership

belongs to the state.

As a result, Europeans, facing uncertain envi-

ronmental consequences while receiving none of

the revenues, tend to oppose fracking nearby. In

the US, by contrast, local residents benefit hand-

somely from being able to sell their ownership

rights to gas companies – a strong counter-bal-

ance to fears of environmental costs.

But private versus state ownership of natural

resources is not the only institutional factor

underlying the US gas boom. A seldom-men-

tioned reason is that shale gas development in the

US has benefited from important tax incentives –

a model that Europe has no reason to emulate.

But the most crucial point about fracking is

that shale gas, like all hydrocarbons, can be used

only once. The real issue is thus not whether

shale gas should be developed in Europe, but

when it should be used: today or tomorrow.

Europe is already a heavy user of gas, but its

consumption is stagnating (along with its econo-

my). Despite the hype about the shale gas revolu-

tion, the extraction cost of (onshore) convention-

al gas remains below that of shale gas. Moreover,

an existing pipeline network implies that this con-

ventional gas can be brought to Europe at a low

marginal cost. From an economic (and environ-

mental) standpoint, fracking is thus unlikely to

bring large benefits for Europe: shale gas might

simply substitute for plentiful conventional gas. ●Daniel Gros is director of

the Center for European Policy Studies.Copyright: Project Syndicate, 2012.

project-syndicate.org

“Pop singers need to havea cohesive image; so dopoliticians”

LLOOKKAALLEE IIMMMMOOBBIILLIIAAW a r s a w B u s i n e s s J o u r n a l ’s w e e k l y s u p p l e m e n t o n r e a l e s t a t e , c o n s t r u c t i o n a n d d e v e l o p m e n t OCTOBER 8-14, 2012, LI 17/40

PPM outlet cen-

ters refinancedInvestment-fund manager

Peakside Polonia

Management (PPM) has

obtained over €106 million

in bank refinancing from

Westdeutsche

ImmobilienBank that will

help the company operate

and further develop three

outlet centers from the

Polonia Property Fund II

portfolio. The three

Fashion House Outlet

Centre facilities in

question are located in

Gdaƒsk (in northern

Poland), Sosnowiec (in

southern Poland) and

Piaseczno (near Warsaw).

Each of them comprises

17,000 sqm of leasable

space and houses from

100 to 120 tenants.

CBRE leases

for Robyg

Developer Robyg has

appointed CBRE as the

leasing agent for its Robyg

Business Center office and

retail project in Warsaw.

The company is

responsible for the leasing

of more than 35,000 sqm

of space that will be

developed within the

complex. Robyg Business

Center is located on

Al. Rzeczypospolitej in the

capital’s Wilanów district.

Construction is currently

underway on the first

building in the complex

which will provide over

8,000 sqm of usable

space. ●

New ECE mall . . . . . . . . . . . . . . .12Immofinanz in Lublin . . . . . . . .12GreenWings construction . . . .13Ogrody mall green-lit . . . . . . . .13Poczta Polska lease . . . . . . . . . .13Retail market . . . . . . . . . . . . . . .14Property-related stocks . . . . . .14Goodman in Gdańsk . . . . . . . . .16Łopuszańska Business Park . .16Office market . . . . . . . . . . . . . . .17Investment market . . . . . . . . . .18KSP plans . . . . . . . . . . . . . . . . . . .19PPP in Warsaw . . . . . . . . . . . . . .20Home sales . . . . . . . . . . . . . . . . .21New Ronson project . . . . . . . . .21Logistics market . . . . . . . . . . . .22

In this issue

SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONNNew shopping malls | Sector analyses | Polish investment market | KSP’s investment plans | Warsaw PPP project | Slipping home sales

Shopping centers

EECCEE ttoo llaauunncchh iittss €€117700 mmiilllliioonnGGaalleerriiaa KKuujjaawwsskkaa pprroojjeecctt nneexxtt yyeeaarrThe company’splanned GaleriaKujawska scheme willdeliver 50,000 sqm ofspace

Developer ECE Projektman-

agement Polska is planning to

launch construction on a new

major shopping center in

Poland in spring next year.

The company’s Galeria

Kujawska mall will be built in

Bydgoszcz, in Kujawsko-

Pomorskie voivodship, and

deliver 50,000 sqm of space.

The investment, whose

value is estimated at €170 mil-

lion, will be the largest shop-

ping and entertainment facility

in Bydgoszcz. It will also be the

largest shopping center project

that ECE Projektmanagement

Polska has developed to date.

According to the company,

there is already considerable

tenant interest in the scheme,

which will house 180 retail

outlets. “Since the middle of

this year, intensive work on

leasing the space has been

underway,” Rafa∏ Pruba, leas-

ing director at ECE Projekt-

management Polska, said in a

statement.

He added that so far terms

of cooperation have been

reached for approximately 40

percent of the retail space in

the development. “Our most

important partners include

some of the most appreciated

fashion brands in the world

and a recognized retailer of

consumer electronics,” Mr

Pruba said.

Earlier this year, ECE fin-

ished demolishing the build-

ings of the former ORTIS

printing facility in Bydgoszcz

that used to occupy the site on

which the planned Galeria

Kujawska project will be

developed.

“We are planning to apply

for a building permit in the

first months of next year,”

Leszek Sikora, development

department director at ECE

Projektmanagement Polska,

said in a statement. The mall is

scheduled to be completed in

spring 2015.

ECE has been developing

shopping centers since 1965.

The company, which is known

in Poland for projects includ-

ing Galeria Kaskada in

Szczecin, is currently involved

in the development of 14 new

malls across Europe.

AAddaamm ZZddrrooddoowwsskkii

Retail

IImmmmooffiinnaannzz ttoo bbuuiilldd zz∏∏..448800 mmllnn mmaallll iinn LLuubblliinnThe project willprovide 37,000 sqm of retail space

Immofinanz Group has

revealed the details of its

planned z∏.480 million Tarasy

Zamkowe retail and entertain-

ment center in Lublin, south-

eastern Poland.

The Austrian real estate

investor purchased land in

Lublin that once hosted the

Galeria Zamek shopping cen-

ter, and has decided to build a

mall that combines shopping

and entertainment facilities on

the plot.

“The city’s economic

strength as well as a low satura-

tion of retail space were the

main reasons for buying the

land along with the old mall

Galeria Zamek and deciding to

transform it into a shopping

and entertainment center,”

Eduard Zehetner, chairman of

the company, said in a state-

ment.

Tarasy Zamkowe is to pro-

vide 37,000 sqm of retail space,

23,000 sqm of public space as

well as 44,000 sqm of parking

space.

There will be 150 shops,

three restaurants, as well as sev-

eral cafes and food outlets.

Work on the project is due

to start this month, and the

shopping center is expected to

be ready by autumn 2014.

Mr Zehetner said Lublin is a

very attractive area for this kind

of investment.

“[With] an actual popula-

tion of 350,000 and a popula-

tion reach of 800,000, [Lublin]

represents a very attractive

place for investment,” Mr

Zehetner said.

Tarasy will combine unique

architecture with high ecologi-

cal standards, the company

says.

On the center’s rooftop

there will be lawns, paths and

viewing points. The company

also hopes to secure BREEAM

certification for the scheme.

“We are happy about the

positive assessment that we

have been receiving so far in

terms of our care for the envi-

ronment,” said Ralph Bezjak,

director of commercial devel-

opment at Immofinanz Group.

“We will certainly try and

acquire BREEAM [certifica-

tion],” he added.

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The Galeria Kujawska scheme is scheduled to be completed in spring 2015

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Tarasy Zamkowe will be ready by autumn 2014

OCTOBER 8-14, 2012 www.wbj.pl 13LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

Poczta Polska leases 13,000 sqmfrom PHN for new headquartersPoczta Polska, Poland’s pub-

lic post service, has signed a

lease agreement for 13,000

sqm of office space in a new

building in Warsaw that will

become its new headquar-

ters. The deal was signed

with Warszawski Holding

NieruchomoÊci, part of the

Polski Holding Nieru-

chomoÊci (PHN) capital

group.

The future headquarters

will be located on ul.

Domaniewska in Warsaw’s

Mokotów district. According

to the deal, the new premises

are due to be handed over for

use by the middle of 2015.

“The whole process was a

major challenge, not only

due to the investment, legal

and technical issues, but also

a short realization period,

compared to market stan-

dards,” Kamil Tyszkiewicz, a

senior negotiator at CBRE,

which helped broker the

deal, said in a statement.

“The facility in question

has not yet been built and the

whole project was interesting

in that it combined a lease

agreement with an invest-

ment agreement,” stated

Joanna Winter, a legal advi-

sor at SSW, which also

helped broker the agree-

ment. She added that the

tenant would have a say in

the final shape of the build-

ing. AAddaamm ZZddrrooddoowwsskkii

Construction to launchon GreenWings offices

The Warsaw projectwill deliver over10,800 sqm of GLA

Investor GreenWings Offices

has appointed CFE Polska as

the general contractor of the

planned GreenWings class-A

office investment in Warsaw.

Construction on the develop-

ment is scheduled to launch

this month.

The GreenWings project is

located on ul. 17 Stycznia in War-

saw’s W∏ochy district, near the

Chopin international airport.

The seven-floor scheme will

deliver 10,810 sqm of leasable

space and 270 parking spaces in

an underground parking lot.

GreenWings’ architectural

design was furnished by the

JEMS Architekci studio. It

calls for the development of a

sustainable facility which has

already been granted a “very

good” BREEAM assessment.

Cushman & Wakefield and

NAI Estate Fellows are the real

estate agents responsible for

leasing space in the GreenWings

project. OKRE Development,

an entity belonging to two Bel-

gian groups, is managing the

whole investment process.

AAddaamm ZZddrrooddoowwsskkii

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The scheme was designed by the JEMS Architekci studio

Shopping centers

OOggrrooddyy mmaallll iinn EEllbbllààggggeettss bbuuiillddiinngg ppeerrmmiittThe extendedshopping center willfeature approximately40,000 sqm of leasablespace

CBRE Global Investors has

received a building permit for

the modernization and exten-

sion of the Ogrody shopping

center in Elblàg, in Warmiƒ-

sko-Mazurskie voivodship.

The investment is set to launch

this quarter and be completed

in 2014.

“After the modernization

and extension, Ogrody will be

a latest-generation shopping

center,” Krzysztof Bocianows-

ki, head of Asset Management

Poland at CBRE Global

Investors, said in a statement.

He added that the facility is

enjoying a lot of tenant interest

and is already 50 percent leased

out. The leasable space of the

Ogrody center will more than

double after the extension, to

approximately 40,000 sqm.

“The realization of the

project will start as early as in

Q4 this year and the opening

of Ogrody in its new shape is

scheduled for 2014,” Tomasz

Szewczyk, regional managing

director of Acteeum Central

Europe, a firm that is respon-

sible for the extension and

commercialization of the mall,

said in a statement.

AAddaamm ZZddrrooddoowwsskkii

OCTOBER 8-14, 201214 www.wbj.pl

Security Closing % change 52-week 52-week % change Total Marketprice (week) low high (year) shares value

on Oct 4 (z∏. mln)

BUDIMEX 57.60 0.61 45.85 88.35 71.55 25,530,098 1,470.53

CELTIC 8.45 1.81 7.02 20.30 19.01 34,231,466 289.26

DOMDEV 28.70 0.74 23.50 42.80 25.04 24,715,272 709.33

ECHO 4.25 -1.16 3.05 4.45 3.44 420,000,000 1,785.00

ELBUDOWA 108.00 0.93 87.00 120.00 100.00 4,747,608 512.74

ENERGOPLD 0.21 -8.70 0.17 2.75 2.45 70,972,001 14.90

ERBUD 13.66 1.19 11.33 23.20 19.60 12,677,956 173.18

GANT 4.21 7.67 3.37 9.85 7.35 20,120,000 84.71

GTC 7.60 1.60 5.20 12.49 10.98 319,372,990 2,427.23

HBPOLSKA 0.02 -33.33 0.01 1.43 0.75 210,558,445 4.21

JWCONSTR 4.19 -4.77 3.85 8.42 6.10 54,073,280 226.57

LCCORP 1.16 -0.85 0.85 1.48 0.98 447,558,311 519.17

MARVIPOL 9.99 -2.06 6.20 11.00 7.25 36,923,400 368.86

MIRBUD 1.15 8.49 0.98 2.68 2.41 75,000,000 86.25

MOSTALWAR 14.30 -0.69 11.30 25.88 21.00 20,000,000 286.00

MOSTALZAB 1.22 -3.94 0.81 1.80 1.14 149,130,538 181.94

ORCOGROUP 7.70 13.07 6.36 19.55 17.90 107,840,962 830.38

PBG 6.11 0.16 3.36 92.00 62.00 14,295,000 87.34

PLAZACNTR 2.39 2.58 1.88 2.94 1.88 297,181,703 710.26

POLAQUA 3.51 6.36 3.30 8.29 7.50 27,500,100 96.53

POLIMEXMS 0.79 -10.23 0.48 2.04 1.60 521,154,076 411.71

POLNORD 14.57 9.63 10.49 19.85 11.03 23,798,439 346.74

RANKPROGR 8.70 9.02 7.10 16.97 9.60 37,145,050 323.16

ROBYG 1.30 -0.76 1.04 1.75 1.10 257,935,500 335.32

RONSON 0.80 -2.44 0.61 1.15 1.00 272,360,000 217.89

TRAKCJA 0.88 2.33 0.65 1.87 1.39 232,105,480 204.25

ULMA 39.20 -0.13 37.20 74.80 62.90 5,255,632 206.02

UNIBEP 4.79 7.40 3.60 6.55 6.08 34,021,684 162.96

WARIMPEX 3.19 0.31 2.64 5.77 5.43 54,000,000 172.26

ZUE 7.25 4.17 5.07 8.98 8.98 22,000,000 159.50

Property-related stocks

LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

MMiixxeedd mmeessssaaggeess iinn CCEEEEExpert’s opinion

BROUGHT TO YOU BY JONES LANG LASALLE

We see rather mixed messages comingfrom the markets across Central andEastern Europe (CEE). In SoutheasternEurope (SEE) real estate trade has beenvery limited, and markets rather illiquid;elsewhere in CEE investors are more activebut certainly cautious.

Notwithstanding, a number of deals areprogressing in Poland, which is by far themost active market in the region, and someof these deals, especially in the retail sector,are at a very core pricing.

Indeed, a number of larger volume trans-actions have been signed and await closingacross Poland. These include Manufakturashopping centre in ¸ódê, Warsaw FinancialCenter (value of around €210 million), Pla-tinium Business Park in Warsaw (value ofaround €170 million) and other deals,including some portfolio deals in the logis-tics sector. It should be noted that so far in2012 investment volumes in Poland havematerially reduced in comparison to 2011,but with some larger transactions underpreliminary agreements and/or some otherin due diligence, it is expected that theentire 2012 investment volume in Poland

will be similar to 2011, somewherebetween €2.0 and €2.5 billion.

Other countries in the CEE/SEE regionwill, however, trade substantially lower vol-umes in 2012, and this includes the CzechRepublic. The Czech Republic had a spec-tacular year in 2011, when a few big-ticketvolume deals traded (examples includeMulti portfolio, VGP portfolio, Olympia Brnoor Palace Flora), and it is now back to morestable market volumes in 2012. Such areduction in volumes is nothing unexpect-ed, bearing in mind the above big-ticketdeals of 2011 – and the Czech market isnow back to smaller volume deals but sta-ble market activity and continued investorinterest.

Over the remainder of the yearinvestors will continue to focus on prime,core markets and products, both in termsof asset quality and locations with flag-ship projects attracting the most atten-tion and good pricing.

Secondary assets continue to beeither illiquid or subject to significant re-pricing. However, prime yields are likelyto remain at reasonably aggressive lev-els, and so prime office yields in Polandand potentially also in the Czech Republicare likely to be at around 6.25%, primeretail yields to be around 5.75% for bestassets, and warehouse yields at around8.0%, again for prime and long-termleased properties. ●

Tomasz Trzós∏oHead of CapitalMarkets,Central Europe,Jones Lang LaSalle

Retail market

PPoollaanndd sseeeeiinngg sstteeaaddyy ggrroowwtthh,, mmooddeerrnniizzaattiioonn In 2012 retail stock inPoland will growabout as much as inyears past, on theback of healthydemand and a slew ofmodernizationprojects

While there is still plenty of

room for more retail develop-

ment in Poland, at least the

continuing economic malaise

in Europe isn’t dragging the

market down. Poland’s retail

market is maintaining steady

growth, as supply still fails to

meet demand, according to

analysts. Modernization and

expansion is a big trend, and

even with a largish pipeline of

projects on the way, there is

still plenty of room for devel-

opment.

According to Jones Lang

LaSalle, the third quarter of

2012 saw anemic delivery of

retail stock in Poland, at just

31,600 sqm. But that belies the

overall trend – the last quarter

of the year will see a huge

increase, to some 162,000 sqm

of stock in seven new and three

extended schemes. By year-

end, Poland’s retail stock will

have grown by 415,000 sqm, in

line with 2010 and 2011 levels.

Warsaw dominantWarsaw maintains average

density for Poland in terms of

stock to population, with about

400 sqm for every 1,000 peo-

ple. Moreover, only 14 percent

of the country’s total stock is

located in the Warsaw market.

As a capital city with by far the

largest purchasing power

(about €9,091, compared to a

country average of €6,607),

analysts see this as far too little.

Even though there are several

projects in the pipeline –

including under construction

projects at Plac Unii, just south

of the city center, and two

shopping and leisure centers

planned by GTC, CBRE char-

acterizes Warsaw’s 2011-2013

pipeline as “clearly insuffi-

cient,” leading to negligible

vacancies and an expanding

area of the prime retail zone.

CBRE calculates the vacancy

rate in Warsaw at about 1.6

percent, compared to an aver-

age vacancy rate in cities with

more than 200,000 inhabitants

of nearly 3 percent, according

to JLL.

Demand reflects these

assessments, with a number of

well-known international

retailers pulling the trigger to

enter the Warsaw market.

These include American Eagle

Outfitters (Arkadia), Victoria’s

Secret Beauty & Accessories

(Z∏ote Tarasy and Galeria

Mokotów), and Hollister from

Abercrombie & Fitch (Galeria

Mokotów).

Smaller citiesSome 57 percent of Poland’s

retail stock is situated within

the markets of Poland’s eight

largest cities, according to

CBRE, but small cities contin-

ue to attract plenty of atten-

tion. The two shopping centers

that were brought to the Polish

market in Q3 were in cities

with fewer than 70,000 inhabi-

tants. Both were developed by

P.A. Nova – Odrzaƒskie

Ogrody was delivered in

K´drzyn Koêle, a city of just

64,000 inhabitants, while Gale-

ria Miodowa went up in

Kluczbork, with just 25,000

people.

This, according to JLL,

“proves that developers and

retailers value the attractive-

ness of smaller cities, even

those below 50,000 citizens.”

Plenty more development in

small cities is expected to come

over the next couple of years,

at least.

More modern As developers try to find ways

to meet demand, several shop-

ping centers in Poland are

undergoing modernization and

extension.

“To date, one-third (i.e. 2.5

million sqm) of the existing

shopping center supply has

been put under some kind of

revitalization program,” wrote

JLL analysts in a recent report.

By 2014, a further 20 projects,

in addition to the 74 that have

already been modernized, will

see revitalization. Included in

this number are some Warsaw

malls, such as Blue City, Gale-

ria Mokotów, Klif and Prome-

nada.

The consultancy says that

the number of value-add and

opportunity-driven investors

has increased significantly, and

describes their investment

strategy of buying up older

assets and revitalizing them to

help them reach their full

potential as an “interesting”

one, but one which neverthe-

less requires considerable

experience and expertise.

RentsWarsaw remains the most

expensive retail location in

the country, with high-street

locations demanding any-

where between €75-95 per

sqm per month. Z∏ote Tarasy,

Arkadia and Wolf Bracka

charge significantly more than

other schemes, according to

CBRE.

In major agglomerations,

rents are significantly lower,

around €35-55, while prime

rents in secondary cities vary

between €21 and €40.

JLL warns that shopping

center owners and developers

must be prepared for down-

ward rental pressure and ten-

ants’ expectations with regard

to fit-out contribution, but

adds that this refers to “sec-

ondary, not leading assets.”

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OCTOBER 8-14, 201216 www.wbj.pl LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

Developer Ghelamco Poland’s

under-construction ¸opuszaƒs-

ka Business Park office project

in Warsaw is now more than 80

percent leased out after the

company secured two tenants

from the financial sector.

The ¸opuszaƒska Business

Park scheme is located on ul.

¸opuszaƒska in the capital’s

W∏ochy district. The complex

will comprise two buildings

offering a total of approximate-

ly 17,000 sqm of office space.

The typical floor will be sized

around 1,500 sqm.

An underground parking lot

with 320 parking spaces will

also be part of the investment.

Construction on the ¸opusza-

ƒska Business Park develop-

ment, which will feature green

building solutions, is scheduled

to be completed within a year.

Ghelamco Poland special-

izes in the development of

office and warehouse buildings

and has turned over more than

390,000 sqm of commercial

space for use over the last 21

years. The company is also,

under the Ghelamco Residen-

tial brand, present in the Polish

housing market. AAZZ

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The scheme is now over 80 percent leased out

Logistics

Goodman builds PomeranianLogistics Centre in GdaƒskThe investment will bethe largest logisticshub of its kind innorthern Poland

Industrial space developer

Goodman has launched con-

struction on its Pomeranian

Logistics Centre project in

Gdaƒsk. The scheme is located

adjacent to the city’s Deepwa-

ter Container Terminal (DCT)

and is expected to become the

largest logistics hub of its kind

in northern Poland.

When completed, the

development will comprise

approximately 500,000 sqm of

warehouse and light industrial

space and its total value will

exceed €300 million. The first

facility within the investment is

scheduled to be delivered at

the end of Q1 2013.

“Due to its excellent loca-

tion, we are convinced that our

Pomeranian Logistics Centre

in Gdaƒsk will meet with con-

siderable customer interest,”

B∏a˝ej Ciesielczak, regional

director at Goodman Poland,

said in a statement.

“The potential customers

we are targeting with this

development include compa-

nies operating locally, domes-

tically and internationally,

across country sectors includ-

ing sea transport, logistics, dis-

tribution, food and FMCG,”

Mr Ciesielczak added.

Goodman is touting the

center’s proximity to road,

rail and air traffic infrastruc-

ture. The nearby Deepwater

Container Terminal, the

largest facility of its kind on

the Baltic Sea, provides a

unique opportunity for port-

centric logistics, the company

said.

“The development of the

logistics center has signifi-

cance for Gdaƒsk as a city aim-

ing to become the main gate-

way to countries in Central

and Eastern Europe,” Boris

Wenzel, CEO of DCT

Gdaƒsk, said in a statement.

Goodman commenced its

operations in Poland in 2005.

The company owns and man-

ages 266,000 sqm of facilities

across the country. It also

holds over 210 hectares of land

in Poland on which 776,000

sqm of warehouse space can

be developed.

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The project is located adjacent to Gdaƒsk’s Deepwater Container Terminal

¸opuszaƒskaBusiness Park signsmajor tenants

OCTOBER 8-14, 2012 www.wbj.pl 17LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

Office market

PPoollaanndd aa ssttaannddoouutt ppeerrffoorrmmeerr iinn 22001122The Warsaw marketremains buoyant,supported by Poland’slargest regional cities

The Polish office sector remains

one of the brightest spots in a

European market haunted by

the ongoing sovereign debt cri-

sis, with strong fundamentals

and its ability to attract interna-

tional occupiers allowing it to

continue growing this year,

where others have stagnated or

shrunk.

According to a recent report

by CBRE, there is over 6 mil-

lion sqm of modern office space

in nine major Polish cities,

160,000 sqm of which was deliv-

ered in the first six months of

this year. Over 1 million sqm is

currently under construction,

scheduled for delivery in 2013

and 2014.

Moreover, while rents for

office space in Europe contin-

ued to fall in the second quarter

of this year (by 0.2 percent q/q,

according to CBRE’s Euro-

pean rental index), rents in

Poland have remained stable.

“The first half of 2012, simi-

larly to the two previous years

on Poland’s real estate market,

was an exceptionally good peri-

od, especially if considering the

volume of leased office space,”

said Tomasz Czuba, director of

the office leasing department at

Jones Lang LaSalle.

Capital activityWarsaw was one of the busiest

markets in Europe in Q2 in

terms of tenant activity, with

lease agreements signed for

more than 172,800 sqm of

space. New contracts accounted

for 67 percent of all transac-

tions.

“The highest rents in the

Polish capital remained at a sta-

ble level in comparison with the

end of 2011,” said Mr Czuba.

Almost 280,000 sqm of

office space is due to be com-

pleted in Warsaw in 2012, mak-

ing it one of the most active

cities in Europe, according to

the CBRE report.

The largest office projects

under construction include the

Warsaw Spire, Gdanski Busi-

ness Centre and Konstruktors-

ka Business Centre.

Tenants’ marketLooking ahead, the supply of

office space in the capital is

expected to start favoring occu-

piers.

If the number of planned

office projects is completed

according to schedule by the

end of next year, Warsaw

should turn into a typical ten-

ants’ market, where tenants will

be able to dictate their condi-

tions, said Rafa∏ Wdowczyk, a

senior office property negotia-

tor at CBRE in Warsaw.

Moreover, 2014 will be the

start of a new five-year leasing

cycle, following on from the

credit crunch of 2009, when

only 350,000 sqm of office space

was leased during the whole

year. This means tenant activity

may be lower in 2014 in com-

parison to today, said Mr

Wdowczyk.

“This should definitely build

the negotiating position of ten-

ants wanting to renegotiate or

relocate,” he added.

In addition, companies in

the financial sector – and partic-

ularly brokerage houses – are

scaling back operations in War-

saw as the government runs out

of assets to privatize and the

boom in stock market listings

continues to subside.

“Assuming that all the

planned projects in the Wola

area [of Warsaw] will be deliv-

ered on time, we can expect

that rents in the CBD may fall

slightly. Office rents for [the

Warsaw district of] Mokotów

should remain stable,” Mr

Wdowczyk said.

“Today companies are still

actively looking for space in

Warsaw. There is no major

slowdown in the amount of

office space activity in the city

center or Mokotów,” he added.

BPO boosts regionsBeyond Warsaw, business serv-

ices firms are helping to drive

office market activity.

Experts say tenants from the

BPO and offshoring, shared

services, and research and

development sectors are eager

to locate their centers in

Poland’s regional cities, where

costs are lower and well-quali-

fied staff readily available.

Daniel Bienias, director of

the office agency and tenant

representation at CBRE, says

the global economic situation,

far from weakening Poland’s

office market, is working in its

favor, since occupiers are locat-

ing or expanding in the coun-

try’s regional cities to take

advantage of lower costs.

“Regional office rents

should remain on a stable

level. Currently many local

markets [are experiencing] a

kind of a rare balance between

the supply and demand for

office space.” said Mr Bienias.

Poland’s office market is

thus in a rude state of health

compared to many in Europe,

with Warsaw as ever carrying

the flag supported by the

country’s largest regional

cities. GGaarreetthh PPrriiccee

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Warsaw Spire is one of the largest ongoing office projects in the Polish capital

OCTOBER 8-14, 201218 www.wbj.pl LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

Real estate investment

Holding firmAdam Zdrodowski: Two officetowers have recently changedhands in Warsaw and a thirdhas been put on sale. What’sbehind this trend?Monika Rajska-Woliƒska:That the sale of the two sky-

scrapers in Warsaw took place

at almost the same time is acci-

dental. Such transactions fol-

low long negotiations and take

months to close. Still, they can

be attributed to the large inter-

est that real estate investors

now have in the Polish market.

Poland is high on the target

list of investors deploying cap-

ital in Europe given its eco-

nomic growth, and the Warsaw

CBD office market offers a

relatively low risk profile given

its strong liquidity and low

vacancy. Twenty-one out of 22

Polish office transactions that

closed in 2011 were Warsaw

properties.

What are the prices like incomparison to previous years?The price levels for core CBD

office products – class-A, well-

located, fully leased, and of

institutional quality – have

held firm, together with the

investment volumes which in

2011 amounted to €2.5 billion,

out of which 49 percent was

attributable to office assets.

H1 reports forecast a decreasein the investment volume in2012. Could the recently con-cluded large deals mean the

volume will actually not belower than last year?We are of the opinion that the

2012 investment volumes will

be similar to the 2011 level of

€2.5 billion, provided that the

transactions which are cur-

rently in due diligence or are

subject to preliminary agree-

ments, close before year end.

Deals currently in due dili-

gence and scheduled to close

in 2012 amount to well over €1

billion in volume. The total

investment volume in the first

three quarters of this year was

approximately €1.15 billion.

Which office products are nowon investors’ radars in Polandand in which locations? Is itjust offices in central Warsawor are buildings in some otherparts of the capital and inregional cities also indemand?The prevailing demand from

investors for office buildings

are for core office assets in

Warsaw’s CBD. That said,

there are several office build-

ings in the Mokotów district

that are under offer or in due

diligence at the present time.

With regard to retail, which

has recently accounted for

approximately 45 percent of

the total investment volume,

investor interest is nationwide

with a focus on Warsaw and

major secondary cities, includ-

ing Kraków, Wroc∏aw and

Katowice.

The most sought-after

shopping centers are those

which are food-anchored and

dominant within their respec-

tive catchment areas. They

also have a strong trading his-

tory and the potential for

being expanded.

With regard to logistics, the

preference has in the recent

past been for well-located

class-A assets with generally

long-term leases, mostly built-

to-suit projects. However, the

logistics investment market is

evolving quickly and we expect

to see a number of larger logis-

tics transactions in the near

future.

Do you expect more largetransactions in the office and

retail sectors to be concludedin Warsaw and Poland atlarge in upcoming months?Yes, we expect that the market

will see the closing of a num-

ber of large transactions be-

fore year-end. The last quarter

of the year is always the most

active and exciting in the

investment market. Unfortu-

nately, I cannot yet reveal any

particular deals that are being

worked on.

Do you see investor interest inprojects which are at theplanning stage?Construction financing con-

straints and pre-lease

requirements are requiring

office developers to consider

joint venture structures or

forward sale transactions and

there is a lot of capital avail-

able for joint ventures from

value added or opportunistic

investors.

The challenges in these

types of transactions arise dur-

ing the structuring process,

since few developers have the

ability to provide the comple-

tion guarantees and other

forms of security that a joint

venture investor generally

requires.

However, core investors

generally prefer to acquire

completed projects, those

which are leased out and gen-

erate revenues. Those invest-

ors consider buying such proj-

ects less risky than investing in

planned schemes. ●

W. P. Carey

finances

warehouse

Investment management

company W. P. Carey will

deliver 100% of the funds

needed to construct a

new 11,000-sqm light-

industrial warehouse

facility that Panattoni

Europe will develop in the

western Polish city of

˚ary. The scheme will be

developed for logistics

and supply-chain

management company

Syncreon. The investment

is located close to the

German border. “W. P.

Carey as a long-term

investor has

demonstrated that it can

provide the financing

companies need to

construct and develop

new facilities in both up

and down market cycles,”

Jeffrey Lefleur, managing

director of W. P. Carey,

said in a statement.

Brochocki

brokes new

dealsThe Kancelaria Brochocki

real estate agency has

brokered lease

agreements for a total of

approximately 10,000

sqm of office space in

Warsaw and Wroc∏aw in

recent weeks. The

largest deals in the

Polish capital included

the lease by EDF Polska

and Polska Organizacja

Turystyczna of

respectively 1,300 sqm in

the Skylight building and

1,000 sqm in the Oxford

Tower building. In

Wroc∏aw, clients included

AXIT, which leased 1,150

sqm in Aquarius

Business House. ●

Lokale Immobilia sits down with MonikaRajska-Woliƒska, managing partner at ColliersInternational, to talk about the currentsituation in, and prospects for, the Polish realestate investment market

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Ms Rajska-Woliƒska said Poland is high on the target list of investors in Europe

OCTOBER 8-14, 2012 www.wbj.pl 19

Real estate investors

KKSSPP ttoouuttss PPoolliisshh ooffffiiccee ooppppoorrttuunniittiieess

Adam Zdrodowski: KSP is arelatively new entity in Polandbut has already acquiredthree office buildings in War-saw. How do you view invest-ment prospects in the Polishproperty market at themoment?Edgar Rosenmayr: The Polish

property market due to its sta-

bility and growing maturity

offers a number of attractive

investment opportunities, ran-

ging from greenfield and

brownfield developments to

recently completed properties.

How much is your companygoing to invest in Polish prop-erty in the next few years andwhich locations and sectorsare of particular interest toyou?It always has been the compa-

ny’s strategy to build a portfo-

lio of institutional quality over

the medium term with a target

equity value of around €500

million. The majority of this

portfolio will comprise offices

but will also include retail to

some extent.

Our strategy foresees

acquiring unique properties –

centrally located, of exquisite

architecture, with excellent

technical parameters, attrac-

tive to tenants, offering a good

potential for value growth dur-

ing a medium- and a long-term

ownership, also those meeting

the highest environmental

standards and being certified

by BREAM or LEED, or qual-

ifying for such certification.

In terms of markets,

Poland will account for the

largest part of our portfolio

which eventually may also

include properties or develop-

ments in other CEE markets.

KSP is also planning to devel-op real estate projects – whatwill be the share of developerprojects in your overall port-folio in Poland?There is no set percentage of

development projects in our

portfolio. Going forward we

expect that approximately half

of our portfolio could be

developments.

The planned Chmielna Towerin Warsaw has encounteredsome administrative obsta-cles. When could constructionon the skyscraper launch andwhat will be its ultimateheight?We are currently working on a

new design and once complet-

ed will reinitiate the permitting

process. If everything goes well

we may see construction start

in the fourth quarter of 2013.

Have you already securedsome other sites in Warsaw orelsewhere in Poland on whichnew projects will be launchedin the near future?Yes of course, KSP is evaluat-

ing a few development oppor-

tunities at the moment, espe-

cially in Warsaw. Unfortunate-

ly, the stage of negotiations is

too early to talk about details.

We will inform the public

about our new projects at the

appropriate time.

KSP has recently unsuccess-fully tried to buy Meble Emil-

ia with its prime site in cen-tral Warsaw. Does this meanthe company is also lookingfor land for other skyscraperprojects in the Polish capital?We regard development of

high-rise buildings as one of

the strengths of our company

given that we have access to

the respective wealth of expert-

ise of our US shareholder. KSP

therefore is looking at land

plots which potentially qualify

for high-rise developments.

What are your expansionplans for the next few years?Which other Polish cities/CEEcountries could KSP enter inthe near future?Our expansion plans will fol-

low our strategy mentioned

above. According to our man-

date, KSP is allowed to invest

in major regional cities in

Poland, as well as in the capital

cities of other CEE countries.

KSP has previously men-tioned the possibility of debut-ing on a stock exchange.Would that debut take placein Warsaw and when could itpotentially happen?A stock-exchange listing still

remains one of the options for

optimizing the capital struc-

ture and ensuring future

growth which will be contem-

plated in a few years. A War-

saw listing will certainly be one

of the possible options to be

considered. ●

Commercial property purchase transactions:How to improve your cash flow

Expert’s opinion

BROUGHT TO YOU BY KR GROUP

Whilst planning an asset transaction, one ofthe most important issues that has a bigimpact on the cost of financing is the taxaspects, in particular VAT paid on the deal.VAT, by definition, should be neutral for anentrepreneur, but it often isn’t.

A standard practice on the real estate mar-ket is that the VAT amount on a property pur-chase is to be settled by the acquiring partyjust after the Sale and Purchase Agreement(SPA) is signed, while the VAT paid may bereclaimed back from the tax authorities within60 days – a standard term according to PolishVAT regulations. This state of affairs can sub-stantially increase the financing costs of adeal. However, it’s possible to obtain signifi-cant savings if the transaction has the assis-tance of tax planning that covers an analysis ofthe opportunities and threats of an accelerat-ed VAT refund application, which is often anoption.

Opportunities for acceleratedreclaim of VAT Following VAT regulations, it is possible toapply for a 25-day refund of input VAT, whichoffers a huge advantage for leverage in assettransactions. An application for the accelerat-

ed refund should be submitted along with theVAT declaration for the month of the acquisi-tion, which is submitted to the tax authoritiesusually by the 25th day of the month followingthe month of the transaction. The basis forVAT deduction is the original hard copy of theVAT invoice received by the buyer, unless elec-tronic invoicing is implemented.

It should be underlined that the accelerat-ed VAT refund option is restricted to certaincases, such as when VAT has already beenpaid. This should be documented with a pay-ment confirmation available before the datethat the refund application is submitted. Addi-tionally, VAT on sales should be declared in thesame VAT declaration.

Within the above-mentioned VAT reclaimprocedure there is still place for further opti-mization. It is worth mentioning that the VATreturn with the refund application may also besubmitted just after the SPA is signed, that is,before the end of a VAT-calculating period.Such an opportunity is possible by predictingcash inflows on the income side. Rental agree-ments for commercialized properties offer aclear picture of the expected turnover, whichmay be stated in a VAT declaration even beforethe month’s end. This may considerably short-en the time gap between the closing date andthe deadline for VAT return and substantiallyrelieve the financing’s cost burden.

Additionally, even a small amount of outputVAT on sales gives a green light for the accel-erated refund. Therefore, in case no VAT-ableturnover resulting from rental agreementssigned for the acquired commercial propertyoccurs in the month of the claim, proper taxplanning may still give an advantage.

Potential risksAs VAT amounts involved with asset deals areusually of significant size, the refund applica-tions are always subject to detailed examina-tion by the tax authorities. For this reason theVAT declaration with the refund claim shouldbe carefully drafted and any potential risksshould be identified in advance and hedged ifpossible.

What should be remembered is that forthe accelerated VAT refund a necessary condi-tion of a full payment of the asset price shouldbe fulfilled, which may seem to be an obsta-cle, having in mind the business practice ofretention payments or deposit accounts forsuch transactions.

Recently, the tax authorities have taken anew approach, according to which they ana-lyze the transaction conditions in more detail,in particular the payment terms based onescrow-account transfers. In such a case, theSPA wording may be relevant for the success-ful fast claim of input VAT.

The attention of the purchaser should alsobe drawn to a potential VAT exemption whichmay be applicable for properties that arealready commercialized. Additionally, theasset deal may be deemed as the transfer ofan organized business unit, which is out of thescope of VAT.

VAT regulations are very complex andtricky in this respect, meaning in-depth insightinto the transaction tax aspects are required,especially given that the threat of an incorrectqualification of the VAT rate imposes a signifi-cant risk for the purchaser: He may bedeprived of the right of a VAT deduction of theincurred VAT amount.

However, despite the existence of poten-tial VAT risks, there is still place for tax opti-mization which may be dealt with successful-ly with the assistance of experienced tax advi-sors, allowing for financing cost cuts and addi-tional cash benefits for the investor. ●

LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

Beata Stasiek-JuszczyƒskaTax Director, KR Group

KR Group

ul. Owsiana 12, 03-825 Warsaw, Poland

Tel.: +48 22 262 81 00, fax: +48 22 616 13 38

office@krgroup.pl, www.krgroup.pl

Lokale Immobilia talks to Edgar Rosenmayr,managing director and member of the board ofreal estate developer and investor KulczykSilverstein Properties (KSP), about thecompany’s investment plans in the Polishmarket

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KSP’s Edgar Rosenmayr says the development of high

rises is one of his company’s strengths

OCTOBER 8-14, 201220 www.wbj.pl LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

Infrastructure

WWaarrssaaww ppuurrssuueessPPPPPP ppaarrkkiinngg pprroojjeeccttThe municipalauthorities areproposing eightpotential locationsacross the city

Warsaw City Hall is looking

for a private investor with

whom it could develop sever-

al multi-storey underground

parking lots within a public-

private partnership formula.

The authorities hope con-

struction on the first such

facility could launch in 2015.

“We estimate that we will

finish the negotiations in

2013 and in the following

year the selected private part-

ner will be securing building

permits. We expect that con-

struction on the first parking

lots could launch in 2015,”

Jaros∏aw Kochaniak, deputy

mayor of Warsaw, said in a

statement.

Warsaw City Hall has

come up with proposals for

eight potential locations for

the planned parking lots in

the capital’s ÂródmieÊcie and

˚oliborz districts, each of

which could contain from 120

to 1,000 parking spaces.

The locations are mostly

some of the busiest squares in

central Warsaw and include

Plac Bankowy (Bank

Square), Plac Konstytucji

(Constitution Square) and

Plac Trzech Krzy˝y (Three

Crosses Square) in the capi-

tal’s downtown. A total of up

to 2,500 new underground

parking spaces could be

developed in those places,

the authorities hope.

The selected private part-

ner will manage the newly

developed parking lots for a

specific, to-be-negotiated,

period of time. The entity will

finance the whole project and

will have revenues from the

operation of the parking

facilities and the accompany-

ing commercial spaces.

The municipal authorities

are looking for an investor

that has built at least one

multi-storey underground

parking lot for 200 or more

cars, designed at least one

completed facility of this kind

and managed at least two

paid underground parking

lots for at least 200 cars over

the last five years.

The goals of developing

the planned underground

parking lots include vacating

the spaces above ground that

are now occupied by cars in

the proposed locations and

improving parking conditions

in downtown Warsaw, War-

saw City Hall said in the

statement.

A consortium of consult-

ing companies Ernst &

Young Corporate Finance,

EC Harris and DLA Piper

has already provided Warsaw

City Hall with a preliminary

feasibility study for the proj-

ect. The advisors will also

support the municipal

authorities in the process of

selecting the private investor.

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Warsaw authorities hope to add up to 2,500 parking spaces through the scheme

“We expect thatconstruction onthe first parking

lots could launchin 2015”

OCTOBER 8-14, 2012 www.wbj.pl 21LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

Ronson launches M∏odyGrunwald in Poznaƒ

Warsaw Stock Exchange-listed

developer Ronson Develop-

ment has launched construc-

tion on the first phase of its

M∏ody Grunwald multifamily

residential investment in Poz-

naƒ, in western Poland. Kar-

mar is the general contractor

of the development.

The M∏ody Grunwald proj-

ect is located at the intersec-

tion of ul. Jeleniogórska and

ul. Kamiennogórska in the

city’s Grunwald district. The

whole scheme will deliver 268

apartments when completed.

The first phase of the invest-

ment will comprise 136 housing

units. They are priced from

over z∏.5,400 to z∏.6,500 per sqm

and include homes that qualify

for the “Family on its Own”

subsidized mortgage program

for first-time home buyers.

Ronson Development has

been active in the Polish mar-

ket since 1999. The company,

which has been listed on the

Warsaw bourse since 2007, is

currently involved in projects

including Espresso, Verdis and

Sakura in Warsaw.

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M∏ody Grunwald will deliver a total of 268 apartments

Residential

WWSSEE ddeevveellooppeerrss sseeeehhoommee ssaalleess sslluummppAnalysts say strictercredit and regulatorypolicies are behindthe drop

A group of 11 major residen-

tial developers listed on the

Warsaw Stock Exchange sold

a total of 1,690 new homes

during the third quarter of

this year, a 6.8 percent drop

compared to Q3 2011.

After the first nine

months of the year, cumula-

tive sales totaled 5,147 units,

a decrease of 9.8 percent y/y.

On a quarterly basis, new

home sales actually rose in

Q3, according to BRE Bank

data.

Experts say the fourth

quarter should see similar

levels of new home sales to

Q3, since developers are

likely to continue taking

advantage of a govern-

ment subsidy program

that finishes at the end

of this year.

“That’s the reason

why Q3 was better on

a quarter-on-quarter

basis – developers have

been using the govern-

ment subsidies to help

them sell new homes,” said

Piotr Zyba∏a, a real estate

analyst at BRE Bank. “The

year-on-year slump, howev-

er, is caused by more funda-

mental factors: because of

the stricter credit policies of

Polish banks and of the regu-

lator,” he added.

When the subsidy pro-

gram ends, new home sales

are expected to fall on a

quarterly basis.

“The only way new home

sales could stay on a similar

level as today would be if the

regulator were to introduce

less strict regulations on

mortgages,” Mr Zyba∏a said.

“However, despite there

being polit-

ical will for

such regu-

latory changes, no hard deci-

sions have been made,” he

added.

Authors of a report on the

state of the Polish residential

and commercial real estate

markets, published last week

by the National Bank of

Poland, noted that the indus-

try is now undergoing heavy

restructuring to adapt to

increasing competition and

lower demand.

However, they feel that the

situation of the average com-

pany in the sector does not

warrant major

concerns, at

least for the

moment.

GGPP,, RRAA

Home sales have fallen as lenders come up against

stricter regulations

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OCTOBER 8-14, 201222 www.wbj.pl LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

Logistics space market

PPoollaanndd pprroovviiddeess ssttaabbiilliittyy ffoorr rreeggiioonnWarehouse completionvolumes are rising fastin Poland, helping tosupport the widerregion The warehouse market in

Poland has picked up the pace

so far in 2012 and is helping to

prop up the wider Central

European logistics market,

according to industry experts.

In the first half of 2012,

some 305,000 sqm of ware-

house space was completed in

Poland – double the volume

delivered in the corresponding

period of last year, and more

than twice as much as in H1

2010, according to a report by

CBRE.

Most of the warehouse

space in Poland is being built

in the Upper Silesia region

and in the city of Poznaƒ.

“At present approximately

251,000 sqm of modern ware-

house space is under construc-

tion in Poland. Most of the

space is built in Upper Silesia

and in Poznaƒ,” Colliers Inter-

national wrote in a recent

report.

Cushman & Wakefield esti-

mated that some 370,000 sqm

of warehouse space was com-

pleted in Central Europe in

H1 2012. The combined value

of the space is put at €170 mil-

lion. As most of this ware-

house space is in Poland,

experts say the country is one

of the biggest stabilizing fac-

tors in the Central European

warehouse market.

Stabilizing influence“The biggest warehouse space

transactions have been noted

in Poland,” said Ferdinand

Hlobil, head of the Central

European Industrial Depart-

ment at Cushman & Wake-

field. “Poland has been [one of

the] main stabilizers in the

region,” he added.

Mr Hlobil said that regard-

less of the ongoing economic

crisis in Europe, the industrial

real estate market in Central

Europe is in relatively good

shape. He added that develop-

ers’ and investors’ plans to

continue their activity indi-

cates that there is a possibility

that the sector could see satis-

factory profits.

The number of warehouse

transactions in Poland has nev-

ertheless been low compared

to the volume seen in the

office and retail markets, due

to the limited availability of

high-quality schemes.

In Q1 2012, just one invest-

ment transaction was finalized

in the logistics sector, with

Hines purchasing a portfolio of

Prologis projects for €96 mil-

lion. In Q2, two investment

deals were closed: Ideal Idea

Park II in Warsaw was pur-

chased by BPH FIZ and Good-

man sold a built-to-suit project

in Legnica to Case Tech.

Output gapThe Polish warehouse space

market is facing a serious out-

put gap, which means develop-

ers will engage more in specu-

lative projects, Jones Lang

LaSalle said in a report.

However, Tomasz Olszew-

ski, head of the industrial

agency for the CEE region at

Jones Lang LaSalle, said

speculative projects won’t be

implemented on a large scale,

and will only enter the market

in H2 2013. He explained that

the small supply of specula-

tively built facilities is prima-

rily the result of restrictive

bank policies. Lenders, he

said, are reluctant to provide

loans for projects which have

not secured lease agreements.

According to Colliers

International, the outlook for

the industrial market for the

next few months is optimistic.

“Rising demand for mod-

ern warehouse space results in

the decrease of vacant space

levels in certain markets which

may increase rental rates.

Almost all projects under con-

struction are already leased.

However, developers still have

a significant amount of land

prepared for warehouse proj-

ects that will be able to satisfy

the demand of prospective

tenants,” said Maciej Chmie-

lewski, a partner in the indus-

trial and logistics department

at Colliers International.

IIzzaabbeellaa DDeeppcczzyykk

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Some 305,000 sqm of logistics space was delivered in Poland in H1, 2012. Pictured

is Prologis Park Wroc∏aw III, which was delivered in 2011

Logistics by numbersPolish warehouse market in the first half of 2012

Warsaw (city) Warsaw (peripheries) Upper Silesia Poznaƒ Central Poland Wroc∏aw

Supply (sqm) 526,100 1,976,600 1,322,600 1,001,100 977,500 651,500

New supply in H1 2012 (sqm) 6,800 68,500 58,900 59,500 41,200 36,300

Net demand in H1 2012 (sqm) 17,700 61,200 105,900 32,900 60,000 66,100

Vacancy rate in H1 2012 (sqm) 12.5% 19.0% 4.5% 3.4% 13.7% 13.4%

Source: Jones Lang LaSalle

OCTOBER 8-14, 2012 www.wbj.pl 23LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– SSPPEECCIIAALL EEXXPPOO RREEAALL EEDDIITTIIOONN

PrzemyÊl as aninvestment location

Case study

Why did REM II decide to invest in thisparticular special economic zone?

Andrzej Pichur: The decision to invest inthe PrzemyÊl special economic sub-zonewas a natural continuation of the develop-ment of our company. In the first years wewere selling our products, mainly in thePodkarpackie voivodship. Today we exportwindows and doors to much more demand-ing markets, mainly in Germany, Italy andSlovakia. Initially we were going to invest ina different zone, but eventually we decidedon PrzemyÊl. Our company has headquar-ters in the city PrzemyÊl and investing in thezone here meant our factory could be builttwo kilometers away from our offices. Also,the legal benefits were a factor that affect-ed our decision.

What made PrzemyÊl so attractive forREM II?The most important factors were the busi-ness aspects that I mentioned. It is impor-tant to underline that throughout the timewe have been present here as a company,we have experienced a very friendly envi-ronment in PrzemyÊl and very attractiveconditions to carry on with our businessactivities. We built a strong group of talent-ed people. Aside from that, as I am from

PrzemyÊl, I have been attached to this cityand I care about its growth and develop-ment. This is why I never considered mov-ing production elsewhere.

How much is your investment worth?

Our investment is worth z∏.7 million

When is REM II planning to start produc-tion?

We are currently preparing to launch pro-duction. As soon as we are done with theformal and legal issues we will launch pro-duction of the doors and windows of Hens-fort, which is the company which we intro-duced this year.

What were the positive surprises thatyou came across in PrzemyÊl once youmade the investment?

Even though we are from here, we werevery pleasantly surprised by the environ-ment of the zone. From our company’s win-dows you can see beautiful views. Anotherpositive surprise is the timely release of thebypass road in PrzemyÊl, which significantlyfacilitates the access to the economic zone,and ultimately makes it more attractive. ●

BROUGHT TO YOU BY MIASTO PRZEMYÂL

PrzemyÊl is a city with an area of46 square km and a population

of 66,909 inhabitants. Located ineastern part of the Podkarpackievoivodship, in southeastern Poland,today it is one of the easternmosttowns in the European Union andplays an important part in cross-border cooperation with Ukraine.

PrzemyÊl is a city with a fairlydiversified economic structure.The three main sectors whichhave developed here are heavyindustry, agritourism and recre-ation, but the city is also develop-ing the telecommunication, con-struction and service sectors.

The dominant industries here

are electrical machinery, woodproduction, mechanical engineer-ing, railway electromechanicalequipment, construction, lighting,furniture, textiles manufacturingand as cosmetics.

PrzemyÊl also boasts invest-ment areas in a subzone of theTarnobrzeg Special Economic

Zone. The zone offers ampleopportunities for investors inter-ested in penetrating markets inBelarus, Ukraine, Russia andPoland’s own fast-developing east-ern markets.

The SEZ provides investorswith public aid in the form of taxexemptions covering up to 70 per-

cent of total investment outlays,while it also offers labor costswhich are the lowest in Poland,according to officials.

The following is an interviewwith Andrzej Pichur, the CEO ofREM II, a maker of .in the PrzemyÊlsubzone, about why the companychose to invest in PrzemyÊl. ●

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W.M

AC

IEJF

IGIE

L.I

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F M

AC

IEJ F

IGIE

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W.M

AC

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OCTOBER 8-14, 2012IINNTTEERRVVIIEEWW24 www.wbj.pl

Higher education

DDooeess PPoollaanndd pprroodduuccee ttoooommaannyy ggrraadduuaatteess??

Remi Adekoya: OECD figuresshow that Poland has one ofthe highest numbers of univer-sity-educated youth in Europeproportional to its population.But Andrzej Klesyk, head ofinsurer PZU, said recentlythat Polish universities aremerely “unemployment facto-ries.” Are they?Juliusz Madej: I have often

wondered to myself whether it

is a good thing that we have so

many graduates or a bad thing.

In my opinion, a higher educa-

tion should be an in-depth,

high-quality experience. In

reality, can we give half our

youth a thorough education? I

doubt that.

So you agree that Polish uni-versities produce graduateswho are bound to join the

ranks of the unemployed?Mr Klesyk accused us of not

preparing students for the

labor market. I beg to disagree.

Universities are not the only

ones to blame. Each particular

stage of the education system

in Poland requires improve-

ment, from the primary class-

rooms onwards. Changes in

educational policy and regula-

tions would help develop more

market-oriented curricula.

At Lazarski University, we

regularly conduct surveys

among businesses to ask them

what they expect from new

employees and how happy they

are with the graduates they

have. The fact is that they gen-

erally do not complain about

the level of knowledge young

people have, but about the

quality of their skills.

WBJ sits down with Juliusz Madej, president ofone of Poland’s best-known private institutionsof higher education, Lazarski University, to talkabout how prepared today’s graduates are forthe labor market, how Poland can develop aninnovative economy and what has changed foryoung Poles over the last two decades

CO

UR

TE

SY O

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AZ

AR

SK

I U

NIV

ER

SIT

Y

Economic

strength, weak-

nesses

Professional services firm

Grant Thornton recently

published its own

economic indicator which

blends GDP growth with 21

other factors that

influence the economy. In

this ranking, Poland

gained 57.2 points out of a

possible 100, placing the

country in 28th spot among

50 countries examined in

the study, Puls Biznesu

reported. Poland’s strong

points include a high level

of business activity and a

favorable political

framework, while weak

points include a low level

of R&D investments.

Joblessness

costs state

z∏.10.5 blnThe long-term

unemployed, namely

people who have been

unsuccessfully looking for

a job for at least one year,

pose a serious social

problem in Poland and are

a source of lost revenue

for the state budget. They

cost taxpayers z∏.10.5

billion a year, according to

calculations made by

Deloitte. ●

“Today, Poland has a‘copy-cat’ economy.Technology is simplytransferred here”

– Juliusz Madej

OCTOBER 8-14, 2012 IINNTTEERRVVIIEEWW www.wbj.pl 25

What kind of skills?Soft skills in particular.

Employers look for graduates

with excellent communication

skills and the ability to cooper-

ate, which many young people

apparently lack. They also

expect advanced computer

skills and fluency in one or two

foreign languages. Some com-

plain about the young people’s

attitude to work, their commit-

ment and so on. Many of these

skills are, to a large extent,

shaped earlier on in life, by the

family environment and later

in primary and secondary

schools.

Why is it that young Poleshave trouble working in agroup?Poles are known as being very

individualistic …

So are Americans, but theyoften manage to cooperateeffectively.The current model of educa-

tion actually discourages coop-

eration between students. In

primary and secondary schools

the emphasis is on individual

achievement benchmarked

against that of others. At

Lazarski, we make sure stu-

dents have opportunities to

enhance their skills in this

sphere. For instance, students

are given group tasks and then

asked to conduct peer evalua-

tion. Do they give their col-

league who they know cheated

during a task an A or an F? No

matter what they decide they

will give the matter much

thought – and that in itself is a

good lesson.

What do your professors complain about regardingtheir students?There seems to be a Europe-

wide problem – the level of

general knowledge demon-

strated by university candi-

dates is gradually decreasing,

year by year. For a time math

was not obligatory on A-level

exams, which was a big mis-

take. Also, literature is no

longer compulsory, so young

people read less and less.

Again higher institutions are

not to blame for the level stu-

dents are at when they enter

universities!

How has the situation ofyoung Poles on the labor mar-ket changed over the last twodecades?In the 1990s the world offered

many opportunities to young

people. There was a huge

demand for educated workers

and people’s careers moved

fast. In two or three years, you

could move up several levels

on the ladder.

Today it is very different.

There is a global crisis, which is

affecting Poland as well. Nowa-

days it is difficult to get a job

even if you are very well-pre-

pared. For young people who

made an effort to study hard at

university, this can be extreme-

ly frustrating. Back then the

labor market was benign, today

it is cruel.

What are some things the gov-ernment could do to improvethe situation of Polish univer-sities?Greater autonomy for higher

institutions, also a leveling of

the playing field between pri-

vate and public universities.

So you think private universi-ties are discriminated against?Yes, we are. For example, pub-

lic universities are subsidized

while private universities

aren’t. Under the Higher Edu-

cation Act of 2005, private uni-

versities could receive subsi-

dies for full-time students;

however the minister of higher

education has not yet issued an

order that would enforce this

regulation.

A lot is made of Poland’s needto transform into a knowledge-based economy, but that does-n’t seem to be happening at aparticularly fast pace. Whatcan the government do tohelp?Today, Poland has a “copy-cat”

economy. Technology is simply

transferred here. This is

strange because Poles are

extremely creative and innova-

tive as a people. There are no

major international IT firms

where Poles don’t work. So it’s

not we universities that are

making the mistakes, because

we are producing these people.

It’s the government and

regional authorities who must

now do their part. There

should be serious tech hubs in

Poland. Why isn’t there even

one in Warsaw?

So you think private universi-ties should receive moneyfrom the government?Money is not even the biggest

problem. There are actually

significant EU funds available

for that purpose. What we

need is someone who will

organize things from the logis-

tical point of view. The real

money is in innovation. Also,

in trying to copy others effec-

tively, we have to compete with

serious players like China and

India.

Why do you think the Polishgovernment is not doing itspart?I am not sure whether it is the

government or external fac-

tors. We are not operating on

an island. There are powerful

players in Europe who have no

interest whatsoever in Poland

becoming an innovative econo-

my and gaining competitive

advantage.

So you need to understand

all these things and have the

determination to push things

forward. ●

“There are powerfulplayers in Europe whohave no interestwhatsoever in Polandbecoming an innovativeeconomy or overtakingthem”

SH

UT

TE

RS

TO

CK

OCTOBER 8-14, 2012TTHHEE LLIISSTT26 www.wbj.pl

Construction & Real Estate

Construction Project Management CompaniesRanked by revenue from project management in 2011 www.bookoflists.pl

Rank

Company nameAddressTel./FaxE-mail

Web page

Revenue fromproject

management(z∏. mln)

Revenuefrom

architecturaldesign

(z∏. mln)

Totalrevenue (z∏. mln)

Land a

cquis

itio

n /

C

ost

est

imate

s /

Feasi

bili

ty s

tudie

s /

Inve

stm

ent

superv

isio

n

Fore

ign p

roje

ct

auth

ori

zation /

P

re-inve

stm

ent

/A

rchitectu

ral desi

gn /

Inve

stor

repre

senta

tion

Docum

ent

pre

para

tion

for

tenders

/Te

nder

managem

ent

Notable projectsrecently completed

Current projects

Number ofarchitects /Number oflicensed

architects

Number ofproject

managers /Number of

constructionengineers /Number oflicensed

engineers

Totalnumber of

employees /Year

founded inPoland

Ownership: Polish /Foreign

Top localexecutive /

Title

1

WS Atkins-Polska Sp. z o.o.ul. Bonifraterska 17, 00-203 Warsaw22 246-0700/22 246-0701atkins@atkinsglobal.plwww.atkinsglobal.pl

34.2(1)

25.7(1)

16.916.0

WNDWND1.5

WND

40.0(1)

33.0(1)

23.2WND

--✓✓

-✓✓-

✓-

A4 highway includingMurckowska junction -

investment supervision; Strykówring road; A2, A1 highways

LNG terminal - investmentsupervision (ÂwinoujÊcie); A2

highway Âwiecko-Nowy TomyÊl;Bielsko-Bia∏a ringroad

WNDWND

WNDWNDWND

WND1993

NoneWS Atkins International

Limited - 100%

Stephen NovisManaging Director

2

CH2M Hill Polska Ltd. Sp. z o.o.ul. Podgórska 34, 31-536 Kraków12 376-5500/12 376-5600officepl@ch2m.plwww.ch2m.com

26.117.818.524.0

----

26.117.818.526.4

-✓✓✓

✓✓✓✓

✓✓

WSK “PZL-Rzeszów” (Rzeszów)- modernization and extension;

project of extension ofproduction plant from cosmetics

industry (¸ódê); documentpreparation, extension andinvestment management

(Garwolin)

PKP PLK - construction ofswitchboard stations Kraków-Zab∏ocie, Kraków-Krzemionki

86

710128

1831996

NoneCH2M Hill International -

90%; CH2M HillInternational Engineering -

10%

Ruben A. RoblesVice President; General Director

3

URS Polska Sp. z o.o.ul. Rejtana 17, 02-516 Warsaw22 427-3700/22 427-3701warsaw@urs.comwww.ursglobal.com

19.815.427.426.8

----

70.877.880.554.2

-✓✓✓

✓✓-✓

✓-

Warsaw Railway Junctionfeasibility study; Pu∏awy ringroad; S69 high-speed road;

diametrical tram linereconstruction (Wroc∏aw); water

supply and sewage networkmodernization (¸ódê)

A4 highway Jaros∏aw-Korczowaand Rzeszów-Jaros∏aw; E-65

Pó∏noc and E-65 Po∏udnie railwaymodernization project; Wroc∏awWater Junction modernization;technical advice on highway

projects for GDDKiA

--

52212110

3111993

NoneURS Corporation - 100%

Simon HindshawManaging Director in Europe

4

PM Group Polska Sp. z o.o.ul. Kleciƒska 125, 54-424 Wroc∏aw71 354-8900/71 354-8901wroclaw@pmgroup-global.comwww.pmgroup-global.com

16.519.016.024.0

24.823.019.022.0

41.342.035.046.0

✓✓✓✓

✓✓✓✓

✓✓

Pittsburgh Glass Works; Autoliv;L’Oreal; 3M; Frito-Lay (Hamburg)

Weyerhaeuser; BAMA Europa;Mando Corporation; Fresh StartBakeries; Pasta Food Company

3020

418036

2331997

NonePM - 100%

Con MurphyManaging Director

5

Ove Arup & Partners InternationalLtd. Sp. z o.o. oddzia∏ w Polsceul. Królewska 16, 00-103 Warsaw22 455-4554/22 455-4555arup.poland@arup.comwww.arup.com

15.9(1)

16.5(1)

17.517.0

WNDWNDWNDWND

45.9(1)

54.0(1)

56.050.0

-✓✓✓

✓✓✓✓

✓✓

CH Silesia City Centre extension;Cracow Cyclotron (Kraków)

Galeria Katowicka (Katowice);National Forum of Music(Wroc∏aw); Atrium South

(Warsaw); CH Gdynia Wzgórze(Gdynia); hospital (˚ywiec)

--

2010045

1331998

NoneArup Group Limited UK -

100%

Andrzej Sitko; JanZabierzewski

Directors

6

Bureau Veritas Polska Sp. z o.o.ul. Migda∏owa 4, 02-796 Warsaw22 549-0400/22 549-0410biuro@pl.bureauveritas.comwww.bureauveritas.com

13.016.17.36.9

----

28.329.631.025.0

-✓✓✓

✓✓--

✓✓

Asbestos monitoring program inNestle plants; technical audit ofKing Cross Leopolis (Lviv); due

diligence for Greenlab; technicalaudit of B&B (Toruƒ)

Rezydencja Bia∏a 3 constructionproject management and

investment supervision; UrzàdSkarbowy investment

supervision (Piaseczno);Wilanów Office Park bank

monitoring (Warsaw)

--

---

721958

NoneBureau Veritas - 100%

Artur SrokaPresident

7

Hill International Sp. z o.o.ul. Marynarska 15, 02-674 Warsaw22 581-3777/22 581-3778warsaw@hillintl.com.plwww.hillintl.com.pl

11.09.020.034.0

----

11.09.020.034.0

-✓✓✓

-✓-✓

✓✓

GTC Platinium IV;GTC Platinium V

Z∏ota 44; Miasteczko Orange;PAOP Cold Store Gdaƒsk; Villa

Arte

11

165146

611991

NoneHill International - 100%

Irvin E. Richter; Jacek˚urawski; Grzegorz

WiÊniewskiBoard Member; ManagingDirector; Project Director

8

Prochem SAul. Powàzkowska 44C, 01-797 Warsaw22 326-0100/22 326-0101prochem@prochem.com.plwww.prochem.com.pl

10.68.67.322.9

18.622.232.436.0

186.0127.0183.0380.0

✓✓✓✓

✓✓✓✓

✓✓

Biological and ChemicalResearch Centre for University of

Warsaw (Warsaw); Faculty ofLinguistics and Modern

Languages for University ofWarsaw (Warsaw); storage and

transshipment of sulfuric acidbase for KGHM Metraco

(Szczecin); sewage sludgeutilization station in “Czajka”wastewater plant (Warsaw)

Special education center(Dàbrowa Górnicza); “Ochota”Center for New Technologies

(CeNT I and CeNT II) forUniversity of Warsaw (Warsaw);

Center of Clean CoalTechnologies (Zabrze);

organization of wastewaterpolicy on Barycz

177

112519

2031947

Prochem Holding - 24.7%;Legg Mason ZarzàdzanieAktywami - 15.5%; ING

TFI - 9.2%; OFE PZU “Z∏otaJesieƒ” - 8.4%

Steve G. Tappan - 9.8%

Jaros∏aw St´pniewskiPresident

9

Portico Project Management Sp. z o.o. i Wspólnicy Sp.k.ul. Gdaƒska 27/31, 01-633 Warsaw22 560-4900/22 560-4910office@portico.com.plwww.portico.com.pl

8.07.85.05.0

0.3---

8.37.85.05.0

-✓✓✓

✓✓✓✓

✓✓

The Forest Opera modernization(Sopot); Interferie Medical SPAHotel (ÂwinoujÊcie); educational

pavilionfor AGH University ofScience and Technology

(Kraków); IKEA store extentionand modernization (Kraków)

PZPN headquarters (Warsaw);radiopharmaceuticals productionplant (Mszczonów); Megapolisresidential complex (Kraków);Malachit Hotel modernizationand Aquapark construction(Âwieradów Zdrój); office

building on ul. Foksal (Warsaw)

WNDWND

WNDWNDWND

WND1998

Robert Pawlak; AleksandraWilczyƒska; Steven Davis

None

Robert PawlakPresident

10

AECOM Sp. z o.o.ul. Emilii Plater 53, 00-113 Warsaw22 822-0051/22 822-0108warsaw.europe@eacom.comwww.aecom.com

6.53.23.41.5

----

6.53.23.41.5

✓✓✓✓

✓✓✓✓

✓✓

Drainage of land for ArenaBa∏tycka stadium (Gdaƒsk

Letnica); Geronimo MartinsDystrybucja distribution center

(Sieradz); JP Morgan new office(Warsaw); John Deere Polskanew training and marketingcenter (Tarnowo Podgórne);Waste Management Facility

(Bielsko-Bia∏a Lipnik)

STOP.SHOP shopping malls(K´trzyn, M∏awa); Geronimo

Martins Dystrybucja distributioncenter (Lubartów); S17 high-

speed road Kurów-Lublin-Piaski;technical advice for GDDKiA;

extension and modernization ofIntegrated Waste Management

System (Pu∏awy)

31

10206

342004

NoneAECOM Limited - 100%

Jaros∏aw KarpiejukManaging Director

11

EC Harris Sp. z o.o. An ARCADIS companyul. Królewska 16, 00-103 Warsaw22 310-2222/22 310-2255echwarsaw@echarris.comwww.echarris.com

5.1(2)

11.610.59.9

WNDWNDWNDWND

12.2(2)

22.121.019.7

-✓✓✓

✓✓-✓

✓✓

TK Maxx stores; Logistics Centre(Gliwice); Panattoni logistics

center (Gliwice); Bumarheadquartes (Warsaw)

TK Maxx stores; CH GaleriaZamek (Lublin); TK Maxx stores;Galeria Garaldia (Starachowice);Schindler Polska headquarters

(Warsaw)

43

112412

401996

NoneEC Harris Holding - 100%

Marcin KlammerManaging Director

12

Lemminkäinen Polska Sp. z o.o.ul. Marconich 11/3, 02-954 Warsaw22 858-9837/22 642-7622lemminkainen@lemminkainen.plwww.lemminkainen.pl

4.740.252.8101.3

----

4.740.252.6112.0

-✓-✓

---✓

--

Suominen Production PlantExtention (Grodzisk Mazowiecki);CARGOTEC The Multi Assembly

Unit (Stargard Szczeciƒski)

Stora Enso Narew PM 5 papermill (Ostro∏´ka); Telefonika CableFactory - preconstruction phase

(Bydgoszcz)

--

7136

161996

NoneLemminkäinen

International - 100%

Eero PunovuoriManaging Director

Services

2011 / 2010 / 2009 / 2008

OCTOBER 8-14, 2012 TTHHEE LLIISSTT www.wbj.pl 27

Notes: Notes: NR = Not Ranked, WND = Would Not Disclose. Research for the List was conducted inOctober 2012. Number of employees and ownership structure are as of September 2012. All information per-tains to the companies’ activities in Poland. Companies not responding to our survey are not listed.Footnotes: (1) Financial year: April 1 - March 31; (2) Financial year: May 1 – April 30

To the best of WBJ ’s knowledge, the information is accurate as of press time. While every effort is made to ensure accuracy and thoroughness, omis-sions and typographical errors may occur. Corrections or additions to The List should be sent, on official letterhead, to Warsaw Business Journal, attn.Monika Brysiak, ul. Elblàska 15/17, 01-747 Warsaw, via fax to (+48) 22 639-8569, or via e-mail to wbjbol@wbj.pl. Copyright 2011, Valkea Media SA.The List may not be reprinted or reproduced in whole or in part without prior written permission of the publisher. Reprints are available.

Rank

Company nameAddressTel./FaxE-mail

Web page

Revenue fromproject

management(z∏. mln)

Revenuefrom

architecturaldesign

(z∏. mln)

Totalrevenue (z∏. mln)

Land a

cquis

itio

n /

C

ost

est

imate

s /

Feasi

bili

ty s

tudie

s /

Inve

stm

ent

superv

isio

n

Fore

ign p

roje

ct

auth

ori

zation /

P

re-inve

stm

ent

/A

rchitectu

ral desi

gn /

Inve

stor

repre

senta

tion

Docum

ent

pre

para

tion

for

tenders

/Te

nder

managem

ent

Notable projectsrecently completed

Current projects

Number ofarchitects /Number oflicensed

architects

Number ofproject

managers /Number of

constructionengineers /Number oflicensed

engineers

Totalnumber of

employees /Year

founded inPoland

Ownership: Polish /Foreign

Top localexecutive /

Title

13

FS&P Arcus Sp. z o.o.ul. Gen. Abrahama 12/11, 03-982 Warsaw22 671-9525/22 671-1236fsparcus@fsparcus.com.plwww.fsparcus.com.pl

0.30.20.30.3

4.36.97.18.1

4.67.27.48.5

✓✓✓✓

✓✓✓✓

✓✓

Adria residential complex(Warsaw); Wilga 7 residentialbuilding (Warsaw); POEMA

residential building (Warsaw)

Karolkowa Business Park(Warsaw); Concept Tower

(Warsaw)

229

621

281988

Mariusz Âcis∏o - 79.3%;Andrzej Bàkowski - 12.4%

None

Mariusz Âcis∏oPresident

NR

Cushman & Wakefield PolskaSp. z o.o.Pl. Pi∏sudskiego 1, 00-078 Warsaw22 820-2020/22 820-2021info.poland@eur.cushwake.comwww.cushmanwakefield.com

WNDWNDWNDWND

WNDWNDWNDWND

WNDWNDWNDWND

✓✓✓✓

✓✓✓✓

✓✓

Galeria Mazovia interior design(P∏ock); Millennium Hall interior

design (Rzeszów)

Plejada (Sosnowiec); Tate & Lyle(¸ódê); Galeria Neptun

(Starogard Gdaƒski); GaleriaCeltic (Legionowo); GaleriaBursztynowa (Ostro∏´ka)

92

21-

1301991

NoneWND

Richard PetersenManaging Partner

NR

Gleeds Polska Sp. z o.o.Pl. Bankowy 2, 00-095 Warsaw22 531-2002/22 531-2003gleeds@gleeds.com.plwww.gleeds.com

WNDWNDWNDWND

----

WNDWNDWNDWND

✓✓✓✓

-✓-✓

✓✓

Park Biznesu Teofilów (¸ódê);office buildings for Ghelamco

(Warsaw); Chung Hongproduction plant (Biskupice

Podgórne); Villa Parc residentialcomplex (Warsaw); Campanile

Hotel, Premiere Class Hotel(Wroc∏aw)

Cosmopolitam (Warsaw);Nimbus (Warsaw); Nowy Targ

undergroung parking (Wroc∏aw);Rua Bonita residential complex(Kraków); logistics centers for

Panattoni

--

344527

651992

NoneGleeds Europe Holdings -

100%

Tadeusz JachowiczDirector

NR

JJM Sp. z o.o.ul. Ciechociƒska 26, 02-924 Warsaw22 646-1883 /22 842-6125jjm@jjm.com.plwww.jjm.com.pl

WNDWNDWNDWND

WNDWNDWNDWND

WNDWNDWNDWND

-✓-✓

-✓-✓

✓✓

WND

Electric works investmentsupervision (Józefos∏aw);

residential building (Piaseczno);technical supervision overPolservices office building

construction; residential building(Warsaw)

11

288

111991

Marek Poncyljusz - 50%;Jerzy Poncyljusz - 50%

None

Marek PoncyljuszPresident

NR

Tebodin Poland Sp. z o.o.ul. TaÊmowa 7, 02-677 Warsaw22 334-4111/22 334-4112info@tebodin.plwww.tebodin.pl

WNDWND41.341.3

WNDWND18.924.2

WNDWND60.270.8

✓✓✓✓

✓✓✓✓

✓✓

Ergo Arena sports andentertainment hall (Gdaƒsk,

Sopot); Farma Wiatrowa(Linowo); TSK Elektronica y

Electricidad bioethanol factory(Kostrzyn nad Odrà); Oxygen

office building (Szczecin);FACTORY Outlet Annopol(Warsaw); FUTURA Park

(Kraków); Gdynia railway stationreconstruction

Browar Lubicz office, residentialand retail complex (Kraków); T1

transshipment station in PortPó∏nocny (Gdaƒsk);

EUROCENTRUM Office Complex(Warsaw); wind turbines

(Pàgów, Laszki, Linów); Las Palmentertainment centre (Grodzisk

Mazowiecki); Coca-Colaproduction plant extension

1616

37267126

3272006

NoneTebodin - 100%

Petr BilekPresident

Services

2011 / 2010 / 2009 / 2008

OCTOBER 8-14, 2012MMAARRKKEETTSS28 www.wbj.pl

SO

UR

CE

: W

SE

PLN-EUR

4.11

38

4.10

20

4.11

15

4.12

02

4.09

33

4.07

66

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

05.1

04.0

4.5 PLN-USD

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

05.1

0

3.

1780

3.

1809

3.

1833

3

.189

6

3.1

646

3.13

53

3.0

3.5 PLN-GBP

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

05.1

0

5.15

71

5.13

84

5.14

36

5.14

16

5.09

97

5.07

26

5.0

5.5 PLN-CHF

3.40

08

3.39

25

3.39

82

3.40

44

3.37

68

3.36

49

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

05.1

03.0

3.5 PLN-RUB

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

05.1

0

0.10

28

0.10

22

0.10

24

0.10

25

0.10

15

0.10

12

0.10

0.11 PLN-100JPY

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

05.1

0

4.09

50

4.07

75

4.07

58

4.07

80

4.03

02

3.99

71

3.8

4.5

currency rates

The RPP and

its mysteries

Currency report

After the previous week’s

small movements, last week

the currency market was

much more volatile. Major

central banks didn’t shock

market participants, but

some macroeconomic data

had an impact.

Jobs increased in the pri-

vate sector in the US, while

the ISM Services index

increased. The EUR/USD

rebounded from its monthly

low of $1.28 all the way to

$1.30. Further upward move-

ments can be expected if

Spain asks for financial aid

and the ECB intervenes on

the bond market (supporting

the euro at the same time).

On the local market, we

experienced what we can call

a “shocking” decision. The

Monetary Policy Council

(RPP) – the rate setting arm

of the National Bank of

Poland – in its mysterious

ways, decided to keep inter-

est rates unchanged at 4.75

percent, despite all the signs

of an economic slowdown. It

seems to me that politics are

taking over rational deci-

sions and that the RPP made

a mistake by not cutting

interest rates.

The reaction on the z∏oty

market was immediate – the

slightly depreciating z∏oty

suddenly regained value. The

EUR/PLN tumbled from its

weekly high of z∏.4.12 all the

way to z∏.4.09 and continued

sliding to z∏.4.07 by the end of

the week.

Similarly, the USD/PLN

declined from z∏.3.20 to

z∏.3.13. Further appreciation

of the z∏oty is possible if the

euro also strengthens.

Otherwise, we should expect

a corrective movement and

see higher z∏oty exchange

rates this week. ●

Adam NarczewskiX-Trade Brokers DM SA

SO

UR

CE

: N

BP

Major indices

Top 5 Closing % change (week) 52-week high 52-week low

BBIZENNFI 0.23 43.75 0.69 0.13IFCAPITAL 0.46 43.75 14.97 0.29ATLANTIS 0.31 34.78 1.21 0.18OPTEAM 3.99 33.44 4.95 1.54BOMI 0.25 31.58 4.60 0.18

WIG 43,840.23 (October 4 close)

Change for the week: 0.18% 52-week high: 44,232.06

Change year to October 04: 14.41% 52-week low: 36,653.28

Top 5 Closing % change (week) 52-week high 52-week low

LOTOS 32.73 5.68 33.12 21.30KGHM 153.00 2.07 174.20 102.40BRE 321.40 1.71 323.50 233.00GTC 7.60 1.60 12.75 5.13BZWBK 236.90 0.38 240.00 207.80

Bottom 5 Closing % change (week) 52-week high 52-week low

HBPOLSKA 0.02 -33.33 1.47 0.01ADVADIS 0.05 -16.67 0.11 0.04AGROWILL 0.56 -16.42 0.97 0.56ALTERCO 0.72 -16.28 47.98 0.71ASSECOSEE 8.40 -15.55 9.90 6.81

Bottom 5 Closing % change (week) 52-week high 52-week low

POLIMEXMS 0.79 -10.23 2.09 0.46CYFRPOLSAT 14.30 -3.25 15.85 12.25BOGDANKA 121.80 -2.87 130.60 100.90PGE 17.99 -2.76 21.78 16.72PGNIG 4.00 -1.72 4.39 3.61

WIG20 2,370.18 (October 4 close)

Change for the week: -0.24% 52-week high: 2,417.32

Change year to October 04: 8.02% 52-week low: 2,035.80

mWIG40 2,373.93 (October 4 close)

Change for the week: 1.20% 52-week high: 2,561.94

Change year to October 04: 8.39% 52-week low: 2,076.52

sWIG80 9,972.58 (October 4 close)

Change for the week: 1.55% 52-week high: 10,536.29

Change year to October 04: 15.90% 52-week low: 8,604.31

NewConnect 34.24 (October 4 close)

Change for the week: -1.38% 52-week high: 43.83

Change year to October 04: -17.47% 52-week low: 33.85

WIG-Banki 6,314.38 (October 4 close)

Change for the week: 0.19% 52-week high: 6,495.06

Change year to October 04: 13.91% 52-week low: 5,163.30

DJIA13,575.36 (Oct 4 close)

0.66% (for the week)

CHANGE: 9.50%

(year to Oct 4)

52-week high: 13,653.20

52-week low: 11,051.10

NASDAQ3,149.46 (Oct 4 close)

0.41% (for the week)

CHANGE: 18.90%

(year to Oct 4)

52-week high: 3,196.93

52-week low: 2,441.48

S&P5001,461.40 (Oct 4 close)

0.98% (for the week)

CHANGE: 14.43%

(year to Oct 4)

52-week high: 1,474.51

52-week low: 1,150.26

FTSE1005,827.80 (Oct 4 close)

0.84% (for the week)

CHANGE: 2.24%

(year to Oct 4)

52-week high: 5,989.10

52-week low: 5,075.20

DAX7,305.21 (Oct 4 close)

0.21% (for the week)

CHANGE: 20.24%

(year to Oct 4)

52-week high: 7,478.53

52-week low: 5,366.50

NIKKEI2258,824.59 (Oct 4 close)

-1.40% (for the week)

CHANGE: 3.09%

(year to Oct 4)

52-week high: 10,255.20

52-week low: 8,135.79

world stock indices

40,000

41,000

42,000

43,000

44,000

45,000

07.0

9

10.0

9

11.0

9

12.0

9

13.0

9

14.0

9

17.0

9

18.0

9

19.0

9

20.0

9

21.0

9

24.0

9

25.0

9

26.0

9

27.0

9

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

2,200

2,260

2,320

2,380

2,440

2,500

07.0

9

10.0

9

11.0

9

12.0

9

13.0

9

14.0

9

17.0

9

18.0

9

19.0

9

20.0

9

21.0

9

24.0

9

25.0

9

26.0

9

27.0

9

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

2,200

2,240

2,280

2,320

2,360

2,400

07.0

9

10.0

9

11.0

9

12.0

9

13.0

9

14.0

9

17.0

9

18.0

9

19.0

9

20.0

9

21.0

9

24.0

9

25.0

9

26.0

9

27.0

9

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0 9,200

9,360

9,520

9,680

9,840

10,000

07.0

9

10.0

9

11.0

9

12.0

9

13.0

9

14.0

9

17.0

9

18.0

9

19.0

9

20.0

9

21.0

9

24.0

9

25.0

9

26.0

9

27.0

9

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

33.0

33.6

34.2

34.8

35.4

36.0

07.0

9

10.0

9

11.0

9

12.0

9

13.0

9

14.0

9

17.0

9

18.0

9

19.0

9

20.0

9

21.0

9

24.0

9

25.0

9

26.0

9

27.0

9

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0 5,900

6,020

6,140

6,260

6,380

6,500

07.0

9

10.0

9

11.0

9

12.0

9

13.0

9

14.0

9

17.0

9

18.0

9

19.0

9

20.0

9

21.0

9

24.0

9

25.0

9

26.0

9

27.0

9

28.0

9

01.1

0

02.1

0

03.1

0

04.1

0

Other indices

Strong start,

weak finish

Stocks report

Polish stocks opened last

week with strong gains, as

investors shrugged off unflat-

tering economic data in

Europe. The first day of

October saw shares dip ini-

tially, with the blue-chip

WIG20 losing close to half a

percent within the first few

hours of trading. Despite

worse-than-expected indus-

trial data in Poland being

announced, shares managed

to claw their way up by noon,

helped partially by strong

openings by other major

indices. For the day, the

WIG20 closed 1.2 percent

higher, with financials Hand-

lowy and PKO BP leading the

way.

Last Tuesday saw less

enthusiasm, with shares

struggling to continue their

gains. European indices

opened much lower, with

both the DAX and CAC40

losing close to 1 percent with-

in the first hour of trading.

The WIG20, after a relatively

volatile session ended the day

flat, while shares on the

small-cap sWIG80 saw hefty

gains, pushing the index up by

0.85 percent for the day. The

next day, despite stronger-

than-expected macroeco-

nomic data from across the

Atlantic, Polish stocks

opened much lower, with

blue-chips losing nearly half a

percent. Shares of TVN and

Kernel were hit hard.

On Thursday, despite reit-

erated commitment from the

ECB to preserve the euro,

shares fell. Polish blue-chips

were hit hard, shares of

KGHM in particular – it shed

2.5 percent.

On Friday, the WIG fin-

ished up 1.56 percent while

the WIG20 rose 1.73 per-

cent. ●

Andrew Nawrocki WBJ market analyst

OCTOBER 8-14, 2012 SSPPOORRTTSS www.wbj.pl 29

BILANS Accounting and Consulting Company Ltd.,02-729 Warszawa, 195 Rolna st., tel. (+ 48) 22 212 86 27-29, mobile: (+48) 502 057 107 e-mail: Jacek@bilans.eu

www.bilans.eu www.bilans.eu

> Establishment of companies> Accounting services> Payroll and human resources> Law and notary offices> Payment recovery and debt recovery> Permits for foreigners> Seat for the company

Motorsports

KKuubbiiccaa wwiinnss aannootthheerr rraallllyy

The Polish driver isbidding to return toFormula 1

Polish racing driver Robert

Kubica made another big step

towards achieving his goal of

returning to Formula 1 after

winning the Citta di Bassano

rally in northern Italy.

The 27-year-old won

seven of the nine stages in a

near flawless performance to

show Formula 1 team bosses

that despite his injury prob-

lems, he still has the talent to

compete at the very highest

level.

The former BMW and

Renault driver, who finished

fourth in the 2008 Formula 1

championships told journal-

ists, “I still have a long road in

front of me. … But this shows

the road is not as long as we

thought.”

This was Mr Kubica’s third

rally and second overall victo-

ry since his return to racing

after he received horrific

injuries, including a partially

severed right arm, in a crash

during the Ronde di Andorra

rally in February 2011.

Following this latest win,

the driver’s surgeon Igor

Rosello said Mr Kubica is

now 50 percent recovered.

DDaavviidd IInngghhaamm

The Pole reached thefinal of the Pan PacificOpen in Tokyo

Poland’s top tennis star,

Agnieszka Radwaƒska, has

maintained her grip on a top-

three spot in the WTA rank-

ings despite losing the final of

the Pan Pacific Open in Tokyo.

The 23-year-old Kraków

native lost 6-0, 1-6, 6-3 to Rus-

sia’s Nadia Petrova, as she

failed to retain the title she

captured last year.

Ms Radwaƒska currently has

8,015 points in the race for the

number-one spot, behind Rus-

sia’s Maria Sharapova in second

(8,435) and Belarus’ Victoria

Azarenka in first (10,095).

Ms Radwaƒska’s younger

sister Urszula moved up four

places to 32nd – a career high

in the WTA rankings – after

she reached the third round of

the Tokyo event. DDaavviidd IInngghhaamm

SH

UT

TE

RS

TO

CK

Prior to his accident last year, Robert Kubica was a force to be reckoned with in F1

SH

UT

TE

RS

TO

CK

Agnieszka Radwaƒska has held on to third place in the WTA rankings

Tennis

RRaaddwwaaƒƒsskkaa kkeeeeppsstthhiirrdd--ppllaaccee rraannkkiinngg

DAILY EXECUTIVE DIGEST

S i g n u p f o r a 2 - w e e k f r e e - t r i a l ! w w w. p o l a n d a m . p lG e r m a n v e r s i o n : w w w. p o l e n a mm o r g e n . p l

Poland A.M. gives you the biggest Polish stories of the day.

Have the most valuable news delivered to your inbox each weekday morning.

OCTOBER 8-14, 2012LLIIFFEESSTTYYLLEE30 www.wbj.pl

The CranberriesOctober 14Torwar, ul. ¸azienkowska 6a Warsaw

Led by the distinctive voice of

Dolores O’Riordan, Irish rock-

ers The Cranberries carved out

a niche for themselves in the

1990s mainstream music scene.

The 1993 single “Linger,”

propelled the band to stardom

and enabled their first album

“Everybody Else Is Doing It,

So Why Can’t We?” to go

multi-platinum across the

globe and in the process help

the band crack the lucrative

US market at their first

attempt.

Their second album “No

Need to Argue,” which con-

tains the band’s biggest hit,

“Zombie,” improved on the

success of their debut, selling a

remarkable 17 million copies

worldwide.

Although big sellers, the

next three releases failed to

achieve the same success and

in 2003 the band went on a hia-

tus to allow members to work

on other material.

But after reforming in 2009,

the group, which hails from

Limerick, is back on tour to

promote its sixth record,

“Roses.”

DDaavviidd IInngghhaamm

Concert

IIrriisshh rroocckkeerrss rreettuurrnnThe Cranberries lead singer Dolores O'Riordan

CO

UR

TE

SY O

F W

IKIM

ED

IA C

OM

MO

NS

HoolsUntil November 11Zach´ta Galleryul. Ga∏czyƒskiego 3 Warsaw

This fascinating new exhibi-

tion attempts to answer

whether young artists can

afford to be hooligans, and

whether a fascination with

damage or destruction is part

of the path to revolutionary

change or just an artistic

strategy to improve populari-

ty.

The objects, films and

paintings in this exhibition

are all arranged in a way that

presents different degrees of

tension, from those less con-

trolled, such as impulsive

aggression, to those that are

more subtle, poetic or

metaphorical.

“They create a feeling of

threat and at the same time

act on us magnetically. …

They are a demonstration of

human strength in the battle

with oneself,” a statement on

the gallery’s website reads.

The exhibition, curated by

Katarzyna Ko∏odziej and

Magdalena Komornicka,

presents the work of artists

including David Adamo, Olaf

Brzeski, Klara Lidén, Joris

van de Moortel, Ahmet

Ögüt, Ariel Schlesinger,

Konrad Smoleƒski, and

Satoru Tamura.

DDaavviidd IInngghhaamm

For more informationlog on to zacheta.art.pl

Exhibition

VViioolleenntt aarrtt??

Film Music in ConcertOctober 14Sala Kongresowa Palace of Culture and SciencePl. Defilad 1Warsaw

A must for film buffs, this con-

cert sees music from a live sym-

phony orchestra mixed with

clips from some classic movies

to bring famous soundtracks to

life.

The majority of the music

comes from Hollywood’s most

famous composer, John Wil-

liams, who wrote the scores for

almost 100 films, winning five

Oscars in the process for

soundtracks including “Jaws”

and “Star Wars.” The concert's

website bills the event as a cel-

ebration of Mr Williams’ “80th

birthday year.” Mr Williams

turned 80 this past February.

This performance, which

will be conducted by Maciej

Sztora, will see the Polish Sym-

phony Ochestra perform clas-

sic musical arrangements from

“Superman,” “Star Wars,”

“Jurassic Park” and “Forrest

Gump,” among others.

In addition to music com-

posed by Mr Williams, there

will also be performances of

scores from other acclaimed

soundtrack composers such as

Hans Zimmer (“Gladiator”)

and James Horner (“Titanic”).

Tickets for the event are

priced from z∏.49.

DDaavviidd IInngghhaamm

For more informationlog on to kongresowa.pl

Concert

CCiinneemmaa ssoouunnddss

For more information log on to torwar.cos.pl

When Techeye was a lad, technology

was for geeks, and geeks were for bul-

lies to beat up. That was the natural

order of things.

Normal people did not think cut-

ting-edge technology like the Com-

modore 64, with its ginormous key-

board and arcane datasette, was cool.

Highly innovative inventions like

“The SunSack,” a codpiece covered in

solar cells that we personally designed

back in high school, were ridiculed.

Then, somewhere

along the

way, technology became a fashion

statement, catching Techeye com-

pletely off guard. One day it wasn’t

enough to love technology for its

own sake – suddenly technology had

to be aesthetically pleasing too. Just

when we had finally lined up a

financial backer to mass produce

SunSacks.

But whatever. The world has

changed and Techeye is changing

along with it. No more high-tech

undies. And we’re replacing our ugly-

but-functional netbook, the one that’s

missing its “m” key, with something

more svelte and less “m”-

asculated.

To that end, we’ve

been looking at the lat-

est ultrabooks – light-

weight, high-end

notebooks – to find

something both

fashionable and

geektastic. One

product line that

fits that de-

scription

is the

Aspire S7 series, which manu-

facturer Acer (Acer.com) has

designed as a rival to Apple’s

MacBook Air.

The Aspire S7 is available in

two screen sizes, 11.6 inch and

13.3 inch, both of which boast

lithe aluminum unibody frames

and full-HD touchscreens. The

devices run Windows 8 and are

powered by Intel i5 or i7 proces-

sors.

The larger model offers 12

hours of battery life; its smaller

sibling offers nine hours. Other

niceties include a backlit key-

board that senses (and adjusts

to) the lighting in its environ-

ment, a reportedly efficient

cooling system and a solid-state

drive (up to 256 GB).

And how much will you pay

for all of this dapper technolo-

gy? Around $1,465 for an i5 version

with 128 GB of SSD storage, which is

more than you would pay for a com-

parably kitted MacBook Air.

Samsung’s Series 5 Ultra Touch,

meanwhile, is aiming more for the

mid-market. This too is a Windows 8

device and it’s got a 13-inch (non-

HD) touchscreen. As with Acer’s

ultrabooks there are Intel

chips inside, though your choice is

between the i3 and the i5 (rather than

the higher-end i7). As for storage, you

get a 500 GB hard drive.

And that’s it. Oh, Samsung would

probably blather on about “advanced

engineering” or “powerful compo-

nents,” but we’ve covered the impor-

tant stuff. Pricing and availability?

Approximately $1,200, on offer from

late October.

In today’s world of well-heeled

technology, either of these ultrabooks

would be a good present for a geek or

a bully. But for a bully looking to beat

up a geek, the Aspire S7, with its alu-

minum unibody, would definitely be

the bludgeoning tool of choice.

After all, the natural order of

things hasn’t changed that much. ●

OCTOBER 8-14, 2012 LLAASSTT WWOORRDD www.wbj.pl 31

GGeeeekkss,, bbuulllliieess aanndd uullttrraa--ffaasshhiioonnaabbllee uullttrraabbooookkssTech Eye

Ever used an expensive piece of technology as a weapon? Let us know: techeye.wbj@gmail.com

Centre forContemporary Art atUjazdowski Castle ul. Jazdów 2www.csw.art.pl

Czarna Gallery ul. Marsza∏kowska 4www.czarnagaleria.art.pl

Galeria 022, DAP, Lufcik ul. Mazowiecka 11awww.owzpap.pl

Galeria 65 ul. Bema 65www.galeria65.com

Galeria Appendix 2ul. Bia∏ostocka 9www.appendix2.com

Galeria Asymetria ul. Nowogrodzka 18awww.asymetria.eu

Galeria Foksal ul. Foksal 1-4www.galeriafoksal.pl

Galeria Milano Rondo Waszyngtona 2Awww.milano.arts.pl

Galeria Schody ul. Nowy Âwiat 39www.galeriaschody.pl

Galeria XX1 Al. Jana Paw∏a II 36www.galeriaxx1.pl

Galeria Zoya ul. Kopernika 32 m.8www.zoya.art.pl

Green Gallery ul. Krzywe Ko∏o 2/4www.greengallery.pl

KatarzynaNapiórkowska Art Galleryul. Âwi´tokrzyska 32, ul. KrakowskiePrzedmieÊcie 42/44and Old Town Square19/21www.napiorkowska.pl

Królikarnia NationalGalleryul. Pu∏awska 113awww.krolikarnia.mnw.art.pl

Le Guern Galleryul. Widok 8, www.leguern.pl

Museum ofIndependenceAleja SolidarnoÊci 62www.muzeumniepodleglosci.art.pl

National Museum inWarsaw Al. Jerozolimskie 3www.mnw.art.pl

Polish National Operaat Teatr WielkiPl. Teatralny 1www.teatrwielki.pl

Pracownia Galeriaul. Emilii Plater 14www.pracowniagaleria.pl

Rempex Art and Auction Houseul. Karowa 31www.rempex.com.pl

Royal CastlePl. Zamkowy 4www.zamek-krolewski.com.pl

Simonis Galleryul. Burakowska 9www.simonisgallery.com

State ArchaeologicalMuseum in Warsawul. D∏uga 52 www.pma.pl

State EthnographicMuseumul. Kredytowa 1www.ethnomuseum.website.pl

Historical Museum of Warsaw Old Town Square 28-42www.mhw.pl

History Meeting House of Warsaw ul. Karowa 20www.dsh.waw.pl

Warsaw Philharmonic ul. Jasna 5www.filharmonia.pl

Warsaw RisingMuseum ul. Grzybowska 79www.1944.pl

Wilanów PalaceMuseum and WilanówPoster Museumul. St Kostki Potockiego10/16www.milanow-palac.plwww.postermuseum.pl

Zachęta National ArtGalleryPl. Ma∏achowskiego 3www.zacheta.art.pl

Museums, galleries and venues in Warsaw

To advertise in WBJ’s classifieds section, contactMs Agnieszka Brejwo, at

(+48) 222-577-526 or abrejwo@wbj.pl

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The Series 5 Ultra Touch

The Aspire S7

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