Matthew Day in Warsaw -
Anyone looking for a flat in the clouds should best head to Poland. A craze for high-rise residential buildings seems to have gripped the country with Polish cities up and down the state working on projects that will not only scrape the sky, but also radically reshape skylines.
Take, for instance, the city of Poznan. The town, which has little in the way of tall buildings at the moment, has three high-rise projects on its books, all of them based in or around the city centre, including the startling Poznan Forum tower. At over 200 metres, the project should bring some 86,000 square metres of residential, office and leisure space to Poznan when completed in 2012.
The seaside town of Gydnia has got in on the act with its Sea Towers high-end residential project, which is now well into construction. With one of its towers reaching 138-metres the building will hold the title of the Baltic coast's tallest when completed; that is until the €90m and curiously named Big Boy tower, which will clock in at 202 metres, gets off the ground in the neighbouring city of Gdansk.
Why the high?
Just why developers and town planners have embraced high-rise residential towers, which usually come packed with additional leisure and office facilities, with such enthusiasm in Poland is rather curious.
One of the conventional explanations for building high is that high city land prices and the limited availability of plots means that developers have little choice but to reach for the skies. This factor in part explains Orco Development's massive 194-metre residential tower in central Warsaw. Currently under construction, the Zlota 44 project will bring 251 flats – or "residences," to use official parlance – to some of the most expensive land in Poland.
But while relevant in other cities, lower land prices in places like Poznan lessens this factor's significance. So for a key explanation to why Poland has now embraced residential mixed-use towers, according to Paul Ayre, director of the architectural firm BroadwayMalyan in Poland, you have to look at the growing maturity of the Polish real estate market. "The sophistication of financing is increasing in Poland," says Ayre. "There is a willingness from forward financers, and others, to put money into a building that is not a simple investment vehicle."
This is significant break from the past. Previously financers and developers would put money into a single-use building such as a shopping mall, an office block or hotel. But residential towers, which come with flats, offices, leisure facilities and even hotels, require more complex financing. "They [residential towers] have different uses, different tenants and sometimes more than one end purchasers," continues Ayre. "And even if there is only one purchaser, it could well mean that they will have components that do not normally fit into their portfolios."
Along with better financing, tall buildings attract attention and this has appeal to both developers and city councils. For developers, forever engaged in a race with a competition to build the best and the grandest, going upwards comes as one way of making a name for themselves. In a similar way, the same applies to cities. Always striving to attract attention, having a landmark and prestigious building in their midst, the theory goes, should put the town on the map and help bring in investment. This has made Polish town planners far more flexible and willing to give the go-ahead to high-rise schemes.
Another factor behind the high-rise craze is that luxury flats tend to sell. If marketed well, the high-end of the residential market can remain generally impervious to market fluctuations and always has enough buyers, especially if the product has a city-centre location. Add to this the reasonable strength of the Polish economy, and developers' hopes and expectations appear to have remained undiminished in Poland despite the global credit crunch and the country's cooling housing market.
"The market has slowed down after the boom years of '06 and '07, but we knew that at the time that it was unsustainable," says Paul Bradley, executive director of Verity Development, which is working on its 100-metre TrieMorfa tower project in Krakow. "The underling economy is still growing at 5-6 per cent and old communist-era buildings are coming to the end of their useful life, which will help fuel demand."
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