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How to invest in Poland? JLL’s latest Made in Poland report

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How to invest in Poland? JLL’s latest Made in Poland report

JLL Poland, the leading advisor in Poland’s real estate market, together with partners, Polish Investment and Trade Agency, Hays and ALTO present the report: “Made in Poland” – a compendium for investors from abroad about institutional support in Poland, legal and tax issues with an analysis of the real estate market, manufacturing sector and the country’s labour market. The aim of the report is to provide investors and manufacturers with essential and up-to-date information as well as guidance on industrial investments in Poland.

Real estate as part of business strategies

The JLL “Made in Poland” report is a guide to property acquisition and leasing methods as well as market practices prepared by JLL Poland experts. The industrial real estate market in Europe is steadily hitting new heights. In the difficult years of 2020 and 2021, it proved its resilience and key importance to the global economy.

“The market faced significant challenges during 2020-2021 due to the COVID-19 pandemic, which significantly impacted supply chains. The pandemic exposed the weak links in global supply chains and highlighted the need for modernization and adaptation. The crisis in Ukraine has further added to the level of uncertainty in the region. In the longer term, major global manufacturers are likely to consider expanding in Europe to reduce the risks associated with supply chain impediments. Moreover, in some cases, manufacturers have started to adopt a just-in-case strategy, replacing the commonly adopted just-in-time approach,” says Maciej Kotowski, Senior Analyst, JLL Poland.

“These moves are currently shaping the future of the industrial market. JLL Poland, as a strategic advisor in the real estate market and thanks to its knowledge, experience and developed tools and analysis guides investors through this process,” adds Tomasz Mika, Head of Industrial Agency, JLL Poland.

Foreign capital is driving the economy

According to the “Made in Poland” report, 2021 was a record year in terms of investments in Poland. With the support of the Polish Investment and Trade Agency, foreign companies invested over EUR 3.5 billion in Poland.

“This is 800 million euros more than last year and 700 million more than the previous record set in 2019. Behind these numbers not only lies money, but also 18,000 new jobs,” says Monika Grzelak, Deputy Director Centre for Strategic Investments, PAIH.

Investors continue to choose Poland

Manufacturers from all over the world see numerous advantages when deciding to invest in Poland. The country has a favourable location on the European continent and a modern transport infrastructure, connecting the region’s major main cities. As well as Poland’s geographical location, the country has also increased its competitive advantage thanks to attractive costs of doing business and public investment incentives. 

“Over the past few years, the regulations for doing business in our country have changed significantly as digitalization of contacts with public administration has become a major trend,” points out Tobiasz Dolny, Partner & Tax advisor, ALTO.

Another important factor is the potential for development - investors want to know whether it will be possible to expand operations in a given location by tens or even hundreds of jobs. The availability of well qualified and educated white-collar and blue-collar workers is one of the key reasons why foreign investors locate their production projects in Poland.

The attractiveness of the offer is key in the team building process

“The manufacturing sector remains a receptive market for investors. By opening a manufacturing facility in a region where there are other entities with similar production profiles, and by offering candidates market-based salaries, assembling the right team is possible. At the same time and at the beginning of the company's operations, it is crucial to create a package of non-wage benefits which will further strengthen the attractiveness of the offer on the market,” emphasizes Łukasz Grzeszczyk, Executive Director, Client Relations, Hays Poland.

In the professional decisions of candidates, the level of remuneration and the offer of non-wage benefits remain key. White-collar workers also often make their career decisions dependent on the type of product, while blue-collar make theirs on the prevailing shift system.

Organizations, which want to remain competitive on the market, must bet on employment flexibility and candidates with the potential to improve their qualifications. In the face of a low unemployment rate and increasing competition for employees, they also need to constantly work on the attractiveness of their offer. According to data from Hays Poland, 59 per cent of employers in the manufacturing sector have implemented salary increases this year due to the inflationary pressures, most often in the order of 6-10 per cent. Among organizations that have not yet decided to take such a step, 36 per cent plan to increase staff salaries in 2022.

A key issue for investors looking at the potential of particular locations in Poland is the availability of an existing talent pool and whether there are plants in the area that have a similar production profile.

Assets tailored to the needs of investors

Poland, as the sixth largest industrial real estate market in Europe, is in the midst of these changes. The maturity of the Polish market is reflected in the diversity of asset types and the wide selection of available locations. The standard of modern existing warehouses allows for the multifunctional use of these buildings, with distribution space easily convertible to light manufacturing needs.

“One of the first decisions to be made with regard to real estate is to choose between leasing or buying an existing hall or a plot of land and making your own investment. This decision depends on the business strategy, the time horizon of the investment, potential expansion plans and the degree of flexibility of the investor. Location is an important factor in this process as property and employees availability, government support and tax implications may vary region by region in Poland,” emphasizes Tomasz Mika, Head of Industrial Agency, JLL Poland.