Warsaw Business Journal Dec 2023/Jan 2024 #82

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YEARS

DECEMBER - JANUARY 2023/24 ~ No. 12 (82)

EXCEPTIONAL BUSINESS

ACHIEVEMENT

AWARD 2023

TOP DEVELOPER ASBUD CLAIMS PRESTIGIOUS PRIZE

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2023 SUMMARY / 2024 FORECAST INSIGHTS FROM LEADING MARKET LEADERS FDIS DRIVE POLAND’S GROWTH AND TRANSITION

NEWS:

• TECH • INVESTING IN POLAND • LOKALE IMMOBILIA

Happy Christmas and Happy New Year

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DEC /JAN

48

8 In Review 12 Opinion News

14

20

A knife at the throat of policymakers

by Sergiusz Prokurat

14 Investing in Poland News

17 Lokale Immobilia News

20 Exclusive

Exceptional Business Achievement Awards

30 Exclusive

Forecasts & Summaries

48 Feature

Beyond borders: FDIs drive Poland’s growth and transition

by Sean Reynaud

55 Tech

Year of LLMs News

59 Life + Style Season's best

59

30

64 Events WBJ.PL

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PUBLISHER'S NOTE

REFLECTING ON 2023: AI'S RISE, GLOBAL CHALLENGES, AND OPTIMISM FOR POLAND'S PROSPEROUS 2024

As we reflect on 2023 and anticipate the arrival of 2024, we've sought the insights of key market leaders and opinion makers, focusing on their perspectives on Poland for our last magazine of the year.

This time also provides an opportunity for introspection and acknowledgement of the past year's remarkable initiatives, investments, and business accomplishments.

Within this issue, on pages (20 to 29), our editorial team recognizes 2023's key players in the Polish real estate sector.

On a personal note, 2023 has been a year of excitement, busyness, and satisfaction.

Valkea, the owner of the Warsaw Business Journal, successfully achieved its business goals and earned the Polish Association of Shopping Centers' recognition as the agency of the year. The Warsaw Business Journal continues to receive global acclaim for its unbiased coverage of Polish business and economic news.

So, what will 2024 bring? It's time for my predictions. My hopes include the end of ongoing conflicts and a greater worldwide focus on sustainability and better governance.

My predictions for Poland anticipate the best year yet in Foreign Direct Investment (FDI). Growing minimum wages, increased internal consumption, a gradual decrease in interest rates, and strong investments are factors that will propel Poland's GDP over 4%, increasing the general welfare. Furthermore, we will also see more companies moving supply chain and production to Poland.

From an international perspective, concerns linger for 2024, including potential security issues arising from AI, uncertainties about the outcome of the American presidential election, and existing geopolitical issues that may exacerbate global imbalances.

There is also the unfortunate possibility of a new virus affecting the world.

Ending on a positive note, I remain optimistic about 2024, a sentiment shared by many thought leaders whose insights you can explore in this magazine. Enjoy the read, have a wonderful holiday season, and accept my best wishes for a prosperous 2024.

MORTEN LINDHOLM

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DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

PORTRAIT BY KEVIN DEMARIA

Undoubtedly, 2023 will be remembered as the year when AI became a mass market issue, sparking widespread discussions on its implications. However, the year was also marked by high-interest rates and the terrible conflicts in Europe/the Middle East.

Agency of the Year 2023

GUESTS

Jarosław Zagórski Jarosław Zagórski boasts 25+ years in the Polish real estate market, specializing in project commercialization, development, office building marketing, and proptech. With a 16-year tenure at Ghelamco, he held roles such as Commercial & Business Development Director and board member.

Currently, as Managing Director since April 2023, he oversees Ghelamco's operations in Poland. Zagórski has crafted leasing strategies for key projects like Warsaw UNIT, The Warsaw HUB, Warsaw Spire, The Bridge, and VIBE. Notably, he led Warsaw Spire to win the prestigious MIPIM Award for the world's best office investment Read his expert opinions are on pages 37 & 39

Morten Lindholm Editor-in-Chief/Publisher mlindholm@valkea.com

Kevin Demaria Art Director kdemaria@valkea.com

Jessica Sirotin Editor Contributors Sergiusz Prokurat Sean Reynaud Beata Socha

Sales

Izabela Kaysiewicz ikaysiewicz@valkea.com Agnieszka Mańkowska amankowska@valkea.com Katarzyna Pomierna kpomierna@valkea.com

Bartosz Turek Bartosz Turek is one of the top experts and commentators on the residential market in Poland. An economist and financial analyst with a specialization in residential real estate and the mortgage landscape, he is a graduate of Warsaw University of Life Sciences.

Prior to joining HRE Investment Trust as the chief analyst, Bartosz gained valuable experience working for Home Broker, Lion’s Bank, and Open Finance.

Print & Distribution

Krzysztof Wiliński dystrybucja@valkea.com Event Director, Valkea Events

Magda Gajewska mgajewska@valkea.com

Read his expert opinion on page 44 Contact: phone: +48 22 257 75 00 fax: +48 22 257 75 99 e-mail: wbj@wbj.pl

WBJ.pl For subscriptions-related enquiries, please email us at wbj@wbj.pl

Radosław Sowiński

In banking since 2008, Radosław Sowiński currently works as a strategic relationship expert at BGK, Poland’s development bank, where he is responsible for key accounts in the industry and energy sectors. He also manages the Industrial Development business model program at BGK, which supports Polish industry development through technology transformation and carbon-neutral policies, as well as by fostering exports of Polish goods and services. Radosław honed his financial analysis, negotiating, and transaction structuring skills at Millennium Bank, where he previously worked as a senior advisor, as well as at ING Bank Śląski and Bank Zachodni WBK. Read his expert opinion on page 53

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DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

WarsawBusinessJournal @wbjpl All photographs used in this issue are courtesy of partners and companies unless specified otherwise.

Copyright © 2023 by Valkea Media SA All rights reserved. This publication or any portion thereof may not be reproduced or used in any manner whatsoever without the express written permission of the publisher.

Published by ul. Jerzego Ficowskiego 15 Valkea Media S.A.01-747 Warszawa Tomasz Opiela, CEO NIP: 525-21-77-350 www.valkea.com To subscribe through RUCH SA: www.prenumerata.ruch.com.pl, prenumerata@ruch.com.pl, 801 800 803

WARSAW YEARS PRESENTS

POLAND EUROPE’S FUTURE Our mission is to serve as a bridge, connecting international investors from around the world with the stories, insights, and individuals responsible for Poland’s success.

We believe that Poland is uniquely positioned to lead this ‘golden decade’ due to its skilled and diligent workforce, robust educational system, strategic location at the heart of Europe, and abundant investment prospects with attractive returns.

Poland: Europe’s Future’ is a platform that ensures access to business and economic news in English through online content, print publications, events, newsletters, and personal interactions.

To be part of the strategic communication of this project please contact : mlindholm@valkea.com

IN REVIEW

Former Polish Prime Minister Donald Tusk has been named "The Most Influential Person in Europe"

by Politico, recognizing his impact on Polish politics and influence in European affairs. The list predicts figures who will make an impact in 2024, including Italian Prime Minister Giorgia Meloni, Ukrainian President Volodymyr Zelenskyy, and Russian Central Bank Governor Elvira Nabiullina. Divided into "doers," "dreamers," and "disruptors," the ranking highlights key figures shaping European politics.

Tusk's recent coalition success in October's elections positions him as a potential future head of government, reflecting shifting power dynamics in Poland.

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SHUTTERSTOCK

DONALD TUSK NAMED EUROPE’S MOST INFLUENTIAL PERSON

IN REVIEW

News

and diverse pricing structures. The report underscores the importance of addressing consumer demands and optimizing digital products.

AI

ELLIS Society opens Warsaw unit

Average Pole will spend PLN 1490 on Christmas Polish holiday spending is expected to rise by 4.4%, averaging PLN 1,490 per person, with a focus on food, gifts, and travel, according to ZBP's annual report. Food and holiday organization will account for PLN 607, a 3.8% increase, while gifts will see a 13% surge, reaching PLN 565. Travel expenses average PLN 318, showing a 7% decrease from 2022 due to lower fuel prices. About 86% plan to finance expenses from current income, though 30% may dip into savings or take loans.

Despite a lower inflationary impact, 64% consider limiting spending, with 43% aiming to economize on gifts.

RETAIL

Allegro plans to conquer four markets The number of active Allegro users who shop through the platform has reached a record high of 14.5 million.

Although consumers are less willing to buy more expensive products today, they ultimately spent more than last year. After its debut in the Czech Republic, the e-commerce giant is also preparing to launch the platform in four additional countries in 2024. These are Slovakia, Hungary, Slovenia, and Croatia.

According to financial data published by Allegro on Thursday, gross merchandise value (GMV) increased by 10.5 % y/y to PLN 13.3 billion in the third quarter, significantly exceeding the growth rate of retail sales in the country. What do we buy the most? As much as one-third of sales fell into the Supermarket and

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Health and Beauty categories.

ONLINE

Video streaming saturated, but subscription numbers grow In Poland, video streaming access declined by four percentage points to 68%, while music streaming remained at 41%, according to a Deloitte report.

The average person now holds 2.59 video streaming subscriptions, up from 1.96 in 2021. The market is approaching saturation, but there’s a rise in movie subscriptions per person. Financial constraints prompt 20% of those canceling video subscriptions. Shared platform access is common, with approximately one-third of users sharing across households. Providers are urged to adapt pricing strategies to consumer needs, introducing family packages

DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

FINANCE

South Korean banks line up to finance arms sales to Poland A group of South Korean private banks will provide Poland with a loan to finance the purchase of military equipment, Reuters reported. Five banks are preparing to provide a syndicated loan that will help Poland purchase South Korean rocket artillery systems and fighter jets, an anonymous government official in South Korea told Reuters. He did not disclose the size of the potential loan. Seoul is actively looking for ways to finance a comprehensive arms deal signed with Poland, under which South Korean companies, including Hyundai Rotem and Hanwha Aerospace, will produce and deliver K2 tanks, K9 selfpropelled howitzers with ammunition, and FA50 fighter jets.

THIS PAGE UNSPLASH, OPPOSITE PAGE SHUTTERSTOCK

RETAIL

ELLIS Society is opening its branch in Warsaw, joining the IDEAS Institute of the National Center for Research and Development. This research unit, focused on artificial intelligence (AI) and technological support, officially started on November 7, 2023. The aim is to strengthen Poland’s position in AI, fostering innovative solutions for the future of AI technology in Europe and globally. ELLIS Unit Warsaw will serve as a hub for scientists from Poland and Europe to collaboratively research AI. ELLIS Society seeks to build collaboration among outstanding researchers, establishing new research institutes as local AI hubs. The initiative emphasizes shaping future generations of AI innovators and scientists through specialized training and fresh ideas in this evolving field.

IN REVIEW

News in Numbers

Poles buy Polish goods

Ad & pharma markets go up

75%

11.5%

7.1%

y/y growth of pharma market in October

y/y growth in advertising market in Q1-Q3

(PEX PharmaSequence)

(Publicis Groupe Polska)

of Poles consider consumer patriotism important (Wiener)

STRONG YEAR AHEAD

Students face rising costs

46%

increase in cost of living for university students between 2023 and 2020 (Warsaw Institute of Banking).

GDP 2024 forecasts:

2.6% (OECD) 3.9% (Goldman Sachs) 3.1% (S&P Global Ratings) Core economic figures

0.5%

6.5%

2.8%

8%

75%

Polish economy’s GDP growth in Q3

inflation in November

unemployment in October, lowest in the EU

core inflation in October

(Eurostat)

(NBP)

of large Polish companies are in good condition

(GUS)

(GUS, flash estimate)

(Nowy Przemysł, Dun & Bradstreet)

WBJ.PL

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OPINION

A KNIFE AT THE THROAT OF POLICY-MAKERS 21,966,891 Polish citizens voted in the parliamentary elections held on October 15, 2023 and voter turnout exceeded 74%. Now, the politicians who have come to power must reflect on the current state of Poland’s finances and decide on the possibility of fulfilling election promises.

w

BY SERGIUSZ PROKURAT

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DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

THE ELECTION FIGHT

Poland has been a battleground for internal conflict over the past 8 years, with ideological clashes taking different forms: social Poland vs liberal Poland, or Poland B (rural east) vs Poland A (cities and the west), highlighting deep-seated social divisions.

However, a new game is about to unfold. The political landscape is set for change, ushering the once-ruling populist-autocratic party PiS to the sidelines and bringing its direct opposition to the forefront. The primary goal of the new government is to rebuild liberal democracy. Interestingly, PiS employed questionable tactics during the pre-election period and suffered defeat. The list of tricks is extensive, ranging from the involvement of public institutions and state-owned companies in the PiS campaign to its financing from the budget (such as picnics advertising the 500 plus program and a meaningless referendum). Despite these tactics and a significant imbalance in access to

SHUTTERSTOCK

e can all agree on the importance of voting, as a foundation of democracy. Despite Karl Popper's principle that there can be no tolerance for enemies of democracy within a democracy, groups with populist and authoritarian tendencies have become a permanent part of Polish political life. In October 2023, Poles decided it was time for a change. Law and Justice (PiS) won 35.38% of the vote, Civic Coalition (KO) secured 30.7%, Third Way (Trzecia Droga) obtained 14.4%, Left (Lewica) received 8.61%, and Confederation (Konfederacja) got 7.16%. It's surprising that the largest increase in the percentage of voters, compared to previous elections, was observed not in large cities—the birthplace of the previous opposition—but in rural areas, where PiS holds influence.

The 2023 elections saw PiS emerge as the victor, but it proved to be a Pyrrhic victory. In reality, PiS faced a setback as it lacked a viable alliance to secure lasting support and failed to garner a strong enough mandate for independent rule. Consequently, it won't command a majority in the Parliament. On the other hand, the opposition, led by KO, will do so. A broad coalition of left-wing and centrist parties (Left, PO, Third Way) is set to form the government.

Warsaw, Poland - OCTOBER 15: Voters turned out in record numbers, nearly 74% – the highest voter turnout in Poland since 1919.

MORE PROMISES – TOUGH QUESTIONS

public funds and television airtime, curiously PiS barely managed to maintain support at a level similar to previous elections. This outcome is a significant blow and a seismic shift for individuals associated with the previous government in state institutions, business, and administrative structures.

Two narratives emerge regarding the state of public finances in Poland. On one side, there's the official account from the outgoing government, where everything is great. On the other hand, there is the expert perspective which offers a less favorable outlook.

Cumulative consumer inflation between 2019-2023 is expected to surpass 45%, with public debt projected to reach 60% by 2026.

The structural deficit is forecasted to be four times higher than the value recommended by the European Commission for stable public finances. While the budget situation may appear positive, it comes at the expense of societal impoverishment, driven by the inflation tax and a spiraling price-wage dynamic. This transition of power occurs against the backdrop of an economy experiencing its lowest investment rate since 1989, at 17% of GDP, following chaotic tax reforms introduced with the 'Polish Deal' in 2022.

The new government is confronted with challenging financial decisions, particularly concerning electricity and gas prices. In 2023, state representatives and politicians control these prices. A decision has been made to freeze electricity prices for most households up to a consumption of 3 MWh, and the same applies to gas prices. Releasing these price controls would result in a significant increase in bills for the average citizen, leading to a swift loss of political support. Despite the economic benefits, transitioning to market forces is challenging due to the looming threat of a return to power by populists.

It is likely that the freezing of electricity prices will be extended for six months, and gas prices will remain frozen throughout 2024, with potential liberalization occurring thereafter. Another pressing issue is the VAT tax on food. Currently, most goods enjoy a temporary zero rate under the "food shield" implemented in February 2022, covering approximately 80% of purchases in a Pole’s average basket. The current budget does not allocate funds to maintain the zero VAT rate, and there are calls from the public to extend this measure, given the challenging outlook for 2024.

The financial situation in Poland is average –not good and not fatal – just average. GDP growth is projected to hover around 0% this year. Despite election promises, ambitious wage increases, including those for the budget sector (20%) and teachers (30%), are likely to be funded through credit. The winning parties, despite pledging to distance themselves from post-election handouts, may find themselves compelled to continue the populist policies of their predecessors. Debates are ongoing about whether substantial expenditures on military growth and the construction of a new mega airport, CPK in Baranów, should be continued. The promises made during the October 2023 elections, such as offering 1500 PLN per month for mothers returning to work until the child is three years old and 0% interest mortgages, contribute to budgetary challenges for 2024 and potentially 2025.

While economic changes may not be swift under the opposition, shifts in foreign policy and judicial institutions are anticipated. Poland is likely to mend relations with the European Union. Notably, there has been a significant shift in the behavior patterns of young people in Poland, aligning more closely with European values. They aspire to a more socially-oriented economy but with a tolerant, European, and non-authoritarian face.

WBJ.PL

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INVESTING in Poland

Energa and Northland to launch offshore farm maintenance company

Energa Wytwarzanie from the Orlen Group and Canadian company Northland Power will establish a joint venture in Poland to provide services for offshore wind farms, as announced by Energa. The joint venture has received approval from the Office of Competition and Consumer Protection (UOKiK). The new company will focus on technical management of offshore wind farm infrastructure, commercial asset management, health and safety, and environmental protection. Energa Wytwarzanie, with experience in the Polish wind energy sector, sees this collaboration with Northland Power’s expertise in servicing offshore wind farms as a valuable combination for the developing sector in Poland. The joint venture aligns with the growing offshore wind potential within the Orlen Group, including the Baltic Power project with a capacity of nearly 1.2 GW, set to commence operations in 2026.

Northland Power, a major player in global offshore wind energy, operates wind farms in Europe and Asia, with an installed capacity of almost 1.2 GW. The partnership reflects the strategic focus on offshore wind development in the region.

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DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

UNSPLASH (5)

Companies’ investment outlays grow 11.5% y/y in Q3

SoftServe opens data & cloud office in Warsaw

The investment expenses of non-financial enterprises increased by 11.5% y/y to PLN 148.1 billion in Q1-Q3 2023, according to the Central Statistical Office (GUS). This data, focused on companies with 50 or more employees, reveals that investments rose in various sectors, such as mining (56.5%), construction (49.9%), and energy production (46.0%). Notably, expenditures on purchases, including transport and machinery, saw significant growth. The report covers 17,587 nonfinancial enterprises with over 50 employees. Overall, the investment landscape seems robust, with substantial increases across key sectors.

SoftServe has officially opened its first office in Warsaw, where over 200 specialists, primarily focused on Data & Cloud, will work, according to Sebastian Drzewiecki, the country manager of SoftServe Poland. The strategic significance of the Warsaw office lies in its connection to the city’s vibrant technology development scene, making it easier to collaborate with professionals in the field. Drzewiecki emphasized the proximity to other European capitals, facilitating a creative exchange of ideas.

The office also aims to support and build a community, especially those who arrived from Ukraine over a year ago. SoftServe, an international technology company, started its operations in Poland in 2014, with over 200 employees in Warsaw specializing in various fields, focusing on Big Data technologies.

Ciech plans to secure a technological partnership with Honeywell

Aldi aims to have 650 stores in Poland by 2028

Poland’s chemical producer Ciech is working on securing a technological partnership agreement with Honeywell, a technology company that manufactures aerospace and automotive products, according to vice president of Ciech Soda Polska Piotr Kapuściński. Under the agreement, Honeywell will provide software solutions in industrial automation that optimizes production in the chemical group’s plants.

Discount chain Aldi plans to have 650 stores in Poland by 2028, the company announced. The chain currently has more than 280 stores and plans to cross the 300 threshold by the end of this year. The German chain entered the Polish market in 2008, opening its stores, among others, in Głogów, Żory, Tarnowskie Góry, Poznań, Bielsko-Biała and Jelenia Góra. It is now present in 195 cities.

WBJ.PL

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LOKALE IMMOBILIA REAL ESTATE INDUSTRY NEWS (covering)

Hospitality, Investment Market,Logistics , Mixed-use, Office, Residential, Retail Find more daily at wbj.pl/real-estate

RESIDENTIAL

Apartment prices in Kraków jumped by 15% in the third quarter Apartment prices in the third quarter increased the most in Kraków, according to the Metrohouse and Credipass Barometer report. On the secondary market, this increase amounted to 15%, while on the primary market, it stood at 10.9%. In Warsaw, these increases amounted to 3.8 and 7.8%, respectively, and in Wrocław, 7.5 and 6.6%.

RETAIL / INVESTMENT

JLL: Retail parks constitute 54% of retail investment deals in Q1-Q3 2023 Retail park investments in Poland accounted for nearly 54% of the total retail investment volume in the first three quarters of 2023, a significant increase from 2018-2019. The interest from investors in convenience-type assets remains high, with various national and international players entering the market. Despite the demand, capitalization rates for top retail parks rose to approximately 7%, reflecting increased financing costs. The total value of retail property sales in Poland for the first three quarters of 2023 reached almost €402 million, representing 49% of the previous year’s value.

Smaller transactions have bolstered the market, constituting 61% of all transactions in 2023.

>>>

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LOKALE IMMOBILIA NEWS

RESIDENTIAL

Demand for mortgage loans grows 254% y/y in October

INVESTMENT

Commercial RE investment expected to pick up in 2024 In the third quarter of this year, the value of deals in the Polish commercial real estate market reached €741 million, marking a fourfold increase quarterover-quarter, according to BNP Paribas Real Estate Poland’s report. While experts see hope for growth, they anticipate waiting until at least the beginning of next year for new transactions. Despite global monetary policy pressures, the last quarter saw a significant improvement in transaction value. Warehouse properties remain of interest to investors, along with retail parks, due to attractive pricing and market liquidity. The overall outlook is promising, but concrete decisions may have to wait until early next year.

In October 2023, there was a significant surge in demand for housing loans in Poland, with a remarkable 254% year-onyear increase, as reported by BIK. The number of applicants for housing loans in August 2023 also rose by 197% compared to the previous year. In October 2023 alone, 41,350 potential borrowers applied for a housing loan, marking a 197% increase from the previous year and a 13% increase from September 2023. The average requested housing loan amount reached a historic high of PLN 421,000 in October, showing a 25% rise from October 2022 and a 0.9% increase from September 2023.

PROPTECH

INDUSTRIAL

2.5 mln sqm of industrial space under construction, half speculative The warehouse construction area in Poland is currently 2.5 million square meters, with over half being speculative investments without a guaranteed tenant, according to CBRE data. Over the past year, the total warehouse space in the country has grown by 12%, reaching 30.5 million square meters at the end of Q3 2023. Despite a slight slowdown earlier in the year, Poland remains an attractive location for tenants. The Warsaw, Katowice, and Wrocław regions are most popular in 2023, with a rise in vacant spaces due to increased speculative constructions. The total demand for warehouses in 2023 has grown by 56%.

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DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

Eco5tech, a NewConnect-listed company specializing in construction project management and implementing innovative Property Technology solutions, reported revenue of PLN 4.8 million in Q3, marking a 36% y/y growth. From January to September 2023, the company achieved PLN 11.7 million in sales, maintaining a high 36% growth rate compared to the same period in 2022. While operational costs increased to PLN 10.5 million, Eco5tech’s strategic projects and robust sales translated into an operating profit of PLN 1.2 million and a net profit of PLN 998,000. The company continues to build its order book and work on flagship PropTech solutions.

PHOTOGRAPHS THIS PAGE PRESS MATERIAL

Prop tech firm Echo5Tech reports record high revenue in Q3

PARTNER SPOTLIGHT

PORTA DOORS. A STRONG ENTRANCE INTO THE FUTURE Last year, PORTA KMI POLAND celebrated its 30th anniversary. Over more than three decades, the Pomeranian company grew from a local door manufacturer employing 10 people into a leading player in the Central and Eastern European market, with nearly 2,000 names on its payroll. PORTA, still exclusively fueled by Polish capital, now enjoys brand recognition of 79%.

From geopolitical challenges to a billion złoty turnover Over the past two years, the market situation has shifted dramatically. Market uncertainty suddenly turned into optimism. Even as customers refrained from purchasing new properties (perhaps due to a slowdown in credit activity), they often opted to renovate existing ones. PORTA actively caters to this segment of the market.

Open to the world PORTA has long outgrown its domestic market, and is now conquering international ones. Through projects in Europe (Germany, France, Czech Republic, Slovakia, Romania, Bulgaria, and Croatia), Asia (Vietnam), North America (US), and Africa (Egypt), the company has gained a reputation as an innovative force dedicated to growing and broadening its customer network. In Southern Euro-

pean markets, PORTA stands out as the first-choice, much like in Poland.

2023 in review In 2023, PORTA announced that it had secured the top position on the builder’s list of door manufacturers, all while maintaining its place as one of the largest players in Poland’s construction industry. PORTA also maintained its position as the foremost producer of wooden doors in Poland, a status ratified by the Center for Industry Analysis through a 2023 certificate from the Market Leader in Carpentry. This recognition underscores PORTA’s consistent ability to meet and exceed high customer demands.

New steel doors – PORTA THERMO In 2023, PORTA introduced four collections of new external steel doors. PORTA THERMO doors combine quality, safety, and energy efficiency. The collections merge durable, thermally insulating SolidTherm composite construction with a unique design. Rooted in the Bolszewo-based company’s work culture, the design process began by establishing initial technological frameworks, and aligning them with analyses of consumer needs. All doors are installed using a comprehensive self-developed threelayer installation method. Subsequently, consultations with professionals, particularly installers from the PORTA Good Installation Academy, played a crucial role in shaping the final product.

Customer-centric approach In addition to high-quality offerings and advanced after-sales services,

customers need interesting and innovative products. PORTA’s CX Design Team, an interdisciplinary internal team composed of designers passionate about design, aesthetics, and architecture, ensures the quality of all products. They also track global trends and new technologies, believing that good design should be considered in the context of everything innovative and current.

Powerful plans for the fourth decade This year witnessed a notable shift in leadership. Jacek Sarnowski, at the helm for 30 years, passed the company’s reins to Łukasz Luto, who assumed the role of CEO on July 1, 2023.

President Luto, formerly the managing director and vice president of PORTA until February 2020, returns after a three-year stint with Barlinek, aiming to contribute to the company’s dynamic development.

The goal and mission of the PORTA DOOR brand remains to create comfortable, modern solutions that transform the immediate environment.

This not only instills a sense of security among customers but also equips business partners with tools that streamline their daily operations.

As it enters its fourth decade, PORTA upholds two core principles – product excellence and prioritizing people – while remaining receptive to new technologies and inspirations. Agile and seasoned, the company looks optimistically toward the future.

For more information visit; www.portadoors.com

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Navigating through Rough Seas EXCEPTIONAL BUSINESS ACHIEVEMENT AWARDS

A

s we approach the culmination of an eventful 2023, the Warsaw Business Journal editorial team has evaluated the movers and shakers of the business landscape in Poland that we believe deserve to be honored for their excellent business achievements in the past year.

It is with pride that we unveil our annual "Exceptional Business Achievement Awards." In a year marked by resilience and adaptation, our aim is to spotlight those who not only navigated difficulties but also laid the groundwork for a brighter and more sustainable future. That is why we have

Real Estate Development of the Year

Urban Regeneration

Outstanding projects successfully delivered and commercialized amidst headwinds in the market.

Ambitious projects set to breathe new life into long-neglected urban spaces and bridge the gap between history and modernity.

ESG Leadership

Region of the Year

Companies that showcase true leadership by maintaining course on sustainability and impeccable governance.

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decided to dedicate this year's awards to the real estate industry. Despite the challenges that have beset the sector, we are excited to recognize and celebrate outstanding contributions that embody the spirit of vision, innovation, responsibility, and leadership.

After thorough deliberation, our editorial team has identified individuals and projects that not only withstood challenges but also showcased exceptional prowess in shaping Poland's real estate market. The chosen categories reflect the multifaceted nature of the property market, as well as the excellence we sought in awarding them.

Regions that have shown the strongest resilience and outpaced other markets in attracting investor attention.

DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

Innovative Approach of the Year

A novel concept that brings a tide of change to an established industry or ventures into uncharted territory.

Investment of the Year

Investors who push full steam ahead and never waver in driving value to the real estate industry.

>>>

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ESG Leadership:

EXCEPTIONAL BUSINESS

ACHIEVEMENT

AWARD 2023

Panattoni

For showcasing leadership by maintaining a course on sustainability and impeccable governance.

- Emilia Dębowska, Sustainability Director, Panattoni

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P

anattoni, one of Europe’s industrial real estate market leaders, has become a standard-setter for logistics and industrial developers across the country. Panattoni Park Szczecin III (halls A and B) achieved an unprecedented "Outstanding" rating in February 2023 through the BREEAM International New

DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

Construction system. This marks a pioneering milestone in Poland’s industrial real estate sector, being the first newly constructed investment to attain such a high level of certification. Currently, about 50% of certified industrial real estate in Poland is part of Panattoni’s portfolio, making the company a trailblazer in the industry.

PRESS MATERIAL

Panattoni was the first developer to introduce a multi-criteria environmental assessment into the standard for implementing industrial investments, currently at the Excellent level. In March 2023, we already had over 8.5 million sqm of certified space in Poland, including two BREEAM Outstanding certificates in the country’s industrial real estate market. In total, this represents over 45% of certified industrial real estate assets in Poland, with an additional 3 million sqm awaiting environmental assessment.

Innovative Approach of the Year:

EXCEPTIONAL BUSINESS

ACHIEVEMENT

AWARD

Noli Studios, Mokotow Investor: NREP

2023

For a novel concept that brings tides of change to an established industry.

New trends in co-living and co-working are powered by our realization that we can deliver innovative solutions that will improve traditional ways of working. Noli Studios was founded on the idea that we could change the world for the better by addressing the needs of the urban professional in a whole new way.”

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n a post-pandemic world where remote and hybrid work intersect with a strong desire to travel, a new breed of city dweller is emerging, bringing forth a fresh demand for residential and hotel services. Noli is a living concept that was initially tested in Helsinki. Noli Mokotów, the inaugural ven-

ture of its kind in Poland, seamlessly blends privacy and comfort, providing short, mid, and long-term accommodations in a prime Warsaw location. The concept is tailored for young, urban professionals seeking flexibility, convenience, and a home-like space until their journey leads them to the next chapter.

- Marta Karteczka, Head of Operations, Serviced Living in Poland, NREP

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EXCEPTIONAL BUSINESS

ACHIEVEMENT

AWARD 2023

Towarowa Towers (marked with letters A and B) together with lower apartment buildings (C, D, E) create a complex carefully designed in the spirit of sustainable construction.

Real Estate Development of the Year: For a remarkable residential project that showcases innovation and design excellence and contributes positively to the local community, with Asbud Group’s apart unwavering commitment to sustainable and eco-friendly real estate development.

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sbud Group’s noteworthy efforts in promoting sustainable practices, emphasizing energy efficiency, and championing environmental responsibility deserve special recognition. By incorporating these principles into their projects, Asbud Group contributes to a much broader goal of creating more environmentally conscious urban spaces.

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The company distinguishes itself by introducing cutting-edge technologies to enhance customer engagement. This forward-thinking approach exemplifies their commitment to staying ahead and utilizing innovation to create a more interactive and satisfying experience for their clients.

The company’s leadership team and founder play a pivotal role in earning this

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award. Their dedication and strong vision significantly impact central areas in Warsaw, contributing to the ongoing development of a better city for tomorrow. This award, therefore, recognizes the tangible outcomes of the residential building project and applauds the visionary leadership that propels Asbud Group toward positively shaping the urban landscape.

PHOTOGRAPH BY KEVIN DEMARIA, BUILDING IMAGE COURTESY OF ASBUD

Towarowa Towers

Interview by Morten Lindholm

ML: Can you elaborate on the advan-

tages of Towarowa Towers' location in the heart of Warsaw, particularly in the context of the new Warsaw city district?

Raied Tanous: The main hallmarks of this dynamically developing district are modern construction and sustainability.

While the first contributes positively to the aesthetic image of the city, the second greatly facilitates the residents' comfort. It's a seamlessly integrated place where residential estates, office centers, and places of culture, entertainment, recreation, and service points intermingle to create a harmonized whole, offering everything the modern generation needs without having to move to other locations. The neighborhood is constantly vibrant and completely self-sufficient.

What makes Towarowa Towers stand out and fit in this location?

With its residential character, Towarowa Towers perfectly balances the office fabric in the immediate vicinity. In terms of architecture, the project is intended to fit coherently into the modern style of the area but also stand out with additional elements. The simple shape is enriched with bay windows, balconies, loggias, and colored aluminum panels, which give it an individual character. Towarowa Towers fits perfectly not only into the landscape of this part of Warsaw but also into the current market demand for high-quality premium investments in the city center and residential tower architecture, which is very rare in Warsaw.

Towarowa Towers is fully consistent with our strategy of overcoming the challenges of bringing new standards to the market. We always plan for tomorrow. We always work with the intention to bring sustainable and timeless projects to the market that both the private and public sectors will appreciate for many decades into the future.

Will Towarowa Towers include retail

WBJ met with Raied Tanous, CEO & Co-Shareholder, ASBUD Group, to learn about the prime location of Asbud’s latest development.

spaces and services within the development, and if so, could you highlight some of the amenities that residents can expect to have nearby?

Residents of the towers will have an outdoor terrace of about 900 sqm at their exclusive disposal, as well as amenities such as well-equipped fitness clubs, lounge areas, and a business meeting room. All without leaving the towers.

Moreover, on the lower floors, we have planned service and retail spaces, following the model of our previous successful central Warsaw projects, creating a modern city-forming development. The estate's surroundings are also designed to be accessible to the public, along with a green boulevard with a fountain, providing humidified air on hot days. Considering the area's current and ongoing dynamic development, we may assume that a dozen recreational or gastronomic venues

will be located in the immediate vicinity.

How has modern technology been incorporated into the design and construction of the apartments?

At the design stage, our goal was to emphasize the uniqueness of this development with modern solutions. Hence, Towarowa Towers is distinguished by solutions that are rare in residential high-rises: opening windows and tilting panels in each apartment and balconies in most of them. Large glazings also provide great interior lighting.

Each apartment is equipped with a smart management system compatible with voice assistants and the ability to expand functionality according to the needs of residents. To ensure the residents' utmost comfort, they can book their preferred time for fitness or meeting rooms via a customized application. We have taken care of solutions to ensure high acoustics, energy, and thermal insulation, and the light source in the towers will be exclusively energyefficient with automatic control in the

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Construction of Towarowa Towers is at an advanced stage.

common areas. On the other hand, security will be ensured by the newest automated access control systems coordinated with the Building Management System, 24-hour security, and a lobby with a reception desk.

External visits by guests or couriers can be granted with single secured access via a customized code restricted to residents, thus ensuring complete privacy and security. So yes, it is a very advanced solution that supports the comfort and efficiency of the asset owners.

When will people start moving in?

The plan is that the Towers and the entire complex will be ready for residents to move in at the end of 2024.

There is much talk about ESG these days. What is your opinion about the

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influence it has on the market of sustainable projects?

From the perspective of a developer who has focused on sustainable construction for years, three factors are most important.

To ensure a balanced understanding and appreciation of the entire ESG field, stricter and clearer regulations should apply to the both the private and public sectors; otherwise, we will always have an imbalanced reality. What we mean is that in the commercial field – office buildings, etc. – the ESG framework is very clear, while in the residential, it is still not moderated enough (lacking legal controls).

In our opinion, the world's residents will benefit significantly from a better understanding and coordination between developers and public architectural administrations during the zoning process, which

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would be based on solid knowledge of the actual requirements of the people in a given area. Simply better communication and sustainable forward thinking that we, as an influential developer, need more from the authorities we have worked with.

Finally, we believe in making the world a better place to live by increasing the city's accessibility yet reducing city congestion by encouraging people to use public transportation and fewer cars; this can be achieved by, among others, planning a lower parking ratio in city areas. A great sustainable example of this is Towarowa Towers, which, thanks to its self-sufficient location, benefits from numerous bicycle paths and excellent public transport access that reduce individual car congestion. Yet, it demands support and cooperation between the private and public sectors to create a better world.

Raied Tanous, CEO & Co-Shareholder, ASBUD Group receives the Warsaw Business Journal Exceptional Business Achievement Award for Real Estate Development of the Year.

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EXCEPTIONAL BUSINESS

ACHIEVEMENT

AWARD 2023

Investment of the year:

NREP’s acquisition of 80% of logistics developer 7R For pushing full steam ahead in driving value to the real estate industry.

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n a year when most investors adopted a wait-and-see approach, some chose to seize opportunities.

Nrep, the ESG-focused real estate investor, has formed a strategic partnership through the acquisition of an 80% stake in 7R (7R SA), one of the largest logistics developers in Poland, investing approximately €200m into the company. The platform will continue to operate under the 7R brand, with partners focused on propelling the company’s growth. After having completed a portfolio of 1.8 million sqm across 36 assets, 7R has an additional pipeline exceeding 2.3 million sqm.

I think that this one deal alone does not necessarily signal that the market has completely turned around, but given the scale and strategic nature of our investment, we feel that we have firmly established our logistics business in the Polish real estate market and are strongly positioned to seize opportunities during the anticipated upswing in the next 24 months.

- Soren Rodian Olsen, head of NREP’s Logicenters in Poland

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Region of Year:

EXCEPTIONAL BUSINESS

ACHIEVEMENT

Wrocław

AWARD

The Wrocław regional market has shown the strongest resilience and outpaced other markets in attracting investor attention.

2023

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rocław faced no serious contenders for the top spot in investment attractiveness in 2023.

Positioned as a high-tech innovation hub with a robust IT sector of 36,000 professionals and a vibrant startup ecosystem, the city secured Poland’s largest Foreign Direct Investment to date, when Intel committed nearly $4.6 billion to a Semiconductor Integration and Testing Facility in Miękina. Strategically located within the Wrocław agglomeration, this state-of-the-art facility is set to meet the growing demand for semiconduc-

tor integrated circuit integration and testing capabilities projected by Intel for 2027. The investment is expected to generate employment for up to 2,000 professionals, with the construction phase creating additional jobs and opportunities for associated suppliers, marking a significant milestone in Poland’s economic landscape.

Among the recent global corporations investing in Wrocław is Nokia, a Finnish leader in broadband transmission in cellular networks. Nokia plans to establish a state-of-the-art technological research and development center in Wrocław, covering

over 13,300 sqm. A new complex, specifically designed for this center, will be constructed in Wrocław, further solidifying Nokia’s status as one of the largest employers in the region.

Wrocław, known for attracting global giants like Google, Microsoft, HP, Credit Suisse, and Bank of New York Mellon, continues to strengthen its position as a key hub for foreign high-tech investments. The city is experiencing a surge in new office constructions, and is expected to reach almost 150,000 sqm by the end of 2023.

This surpasses developments in both Kraków and the Tricity market.

Urban Regeneration: Royal Paper Mill in Konstancin-Jeziorna

For the ambitious project, by developer Arche Group, set to breathe new life into long-neglected urban spaces and bridge the gap between history and modernity.

PRESS MATERIAL

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n the heart of Konstancin-Jeziorna, the Royal Paper Factory stands as a historic gem, its roots tracing back to the era of King Stanisław August Poniatowski. This is where the paper was produced for drafting the Constitution of May 3rd.

Acquired by the Arche Group in 2022, the factory’s dilapidated structures conceal a complex and beautiful labyrinth of spaces. The ambitious revitalization project envisions a multifunctional space, blending modern conveniences with historical preservation. The complex will feature conference halls, a hotel, a museum, a bookstore, cinema,

theater, restaurants, and communal areas. The project aims not only to salvage architectural beauty but also create a hub for the local community, honoring the factory’s rich legacy.

The vision unfolds in a 6,000 sqm expanse, making it the largest cultural and event space in the Mazovia region. The surrounding park will tie the facility together, serving as both a recreational area and a space for pedestrian and cycling activities.

The Royal Paper Factory’s rebirth promises to be a vibrant blend of tradition and modernity, a testament to the enduring spirit of this historic landmark.

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FORECASTS SUMMARIES

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We asked a range of experts to provide retrospective analyses of 2023 and forecast the trends and market drivers that will shape Poland’s evolving business landscape in 2024.

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FORECASTS SUMMARIES

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ECONOMIC OUTLOOK Poland and CE should avoid recession despite pessimism from Germany

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ments in Poland have risen again, surpassing the post-pandemic average since April. This improvement is evident in national data, including retail sales growth, supported by rising wages that have outpaced inflation.

The global economic downturn, influenced by weak recovery in China, inflation affecting real incomes, the post-pandemic shift from goods to services, and deglobalization, has led to a decline in worldwide orders in industrial processing. However, Poland’s production seems to be maintaining a new, higher trend, significantly above pre-pandemic norms. Nearshoring production to nearby countries may be contributing to this trend.

With improving economic sentiments in Poland, most sub-sectors in industrial processing have seen positive changes. However, the exposure to Germany as a primary trading partner is pulling Polish companies in the opposite direction. The study has examined 21 sub-sectors in industrial processing, comparing the change in 28 business trend indicators from October 2022 to October 2023 with sectoral exposure to the German economy, expressed as the share of companies controlled by German investors. The findings suggest that less exposure to the German economy corresponds to a more significant improvement in economic conditions. Companies

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linked to German capital express serious concerns about their future, overall economic situation, production, and domestic and foreign orders.

Despite the recession in Germany slowing down this year’s growth, most economies in Central Europe are expected to avoid a recession. The Deloitte consensus of market and institutional forecasts indicates a 0.7% slowdown in growth in Central Europe this year (with expected declines in Estonia and Hungary), contributing to faster deflation.

October forecasts from the International Monetary Fund suggest that only Croatia will surpass pre-pandemic expectations for growth this year (by 2.9%), with Poland falling 0.5% below and the Czech Republic remaining 10% below.

According to the consensus, the growth rebound in 2024 will be mild, partly due to the restrictive monetary policy in the eurozone. The average growth in Central Europe will be 2.5% (ranging from 2.0% in Lithuania and Latvia to 3.4% in Romania), with continued elevated inflation at 4.3% (from 2.8% in Latvia to 6.1% in Poland). Significant uncertainty remains regarding the exchange rates of the złoty and forint, evident in the wide range of forecasts for these currencies.

Experts Julia Patorska, Aleksander Łaszka, and Rafał Trzeciakowski, Deloitte

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he European Commission’s economic sentiment index for Poland and Germany has shown significant divergence this year. While Poland is experiencing growth and heading towards expansion, Germany is moving towards a recession. The economic situation in Germany and the north-western part of the EU raises questions about whether it will lead to a slowdown in growth in Poland, Central Europe, and the southern eurozone.

The European Commission’s economic sentiment index, comprising industry, construction, services, retail trade, and consumer confidence, has indicated disparities between Germany and Poland since the beginning of 2023. Manufacturing and trading companies in Germany have been dealing with excess inventories, leading to a gradual reduction in demand for industrial goods. This inventory reduction has lowered economic sentiment in German industry by over 10%, below this year’s level. In contrast, Polish industry has shown resilience and has performed close to the post-pandemic average.

Worsening sentiments persist in construction and industry in Germany due to higher interest rates discouraging credit uptake and reducing demand. In Poland, construction continues to be supported by government subsidies for mortgage loans. Consumer senti-

POLISH COMPANIES SCRAMBLE TO IMPLEMENT AI In the rapidly evolving landscape of artificial intelligence (AI), where does Poland stand in terms of readiness for adoption?

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oland showcases both strengths and areas for improvement in its AI readiness. While strategic initiatives are underway, challenges persist in infrastructure, data management, governance, talent readiness, and cultural integration. Here is a breakdown of how advanced Poland is in AI adoption based on a recently published “Cisco AI Readiness Index.”

the majority (63%) falling into the "Followers" or "Laggards" categories. Polish firms have their work cut out for them in making their IT infrastructure scalable and flexible, which is crucial for handling the demands of AI applications.

As many as 86% of respondents express a need for additional data center graphics processing units (GPUs), indicating the necessity for further infrastructure investments.

STRATEGY: SETTING THE FOUNDATION

DATA: UNLOCKING AI POTENTIAL

The first pillar examined in the study is strategy, the bedrock on which successful AI integration is built. In Poland, 46% of organizations fall into the "Followers" category, indicating a moderate level of preparedness, while only 29% are categorized as "Pacesetters," reflecting a fully prepared status.

This suggests that while significant strides have been made, a considerable portion of businesses are still navigating the complexities of AI strategy development.

INFRASTRUCTURE: THE BACKBONE OF AI IMPLEMENTATION Moving beyond strategy, the study emphasizes the importance of a robust infrastructure for effective AI utilization. Unfortunately, only 7% of Polish organizations are classified as "Pacesetters" in infrastructure readiness, with

In the realm of data readiness, a critical aspect of AI success, Poland faces challenges. An alarming 92% of respondents admit that their data exists in silos across the organization, hindering the seamless operation of AI algorithms. Although 56% positively rate their analytics tools for handling complex AI-related data sets, a significant hurdle lies in the lack of integration between analytics tools and data sources, reported by 80% of organizations.

GOVERNANCE: NAVIGATING ETHICAL AND RESPONSIBLE AI With 75% of organizations classified as "Followers" or "Laggards," only 7% earn the "Pacesetters" designation in governance preparedness.

Alarmingly, 38% of organizations acknowledge limited awareness of potential biases and fairness issues in their AI-related data sets. This highlights a pressing need for orga-

nizations to establish comprehensive AI policies and protocols.

TALENT: BRIDGING THE SKILLS GAP Having the right talent for successful AI integration is critical. In Poland, 63% of organizations consider themselves moderately well-resourced in terms of AI talent, while 22% feel under-resourced. Comprehension and proficiency in AI tools and technologies emerge as the primary skill gap, identified by 31% of respondents. Around 93% of organizations are actively investing in training to address this gap, indicating a proactive approach to upskilling the existing workforce.

CULTURE: EMBRACING CHANGE FOR AI SUCCESS Culture readiness, reflecting the willingness of stakeholders to embrace AI, also presents a mixed picture in Poland.

While 81% of organizations express a moderate to high level of urgency in embracing AI, challenges exist at the middle management and employee levels. A comprehensive change management plan, a crucial tool for navigating AI integration complexities, is still in progress for 69% of organizations.

In general, Poland faces several aspects that require enhancement in terms of AI adoption readiness. Timing is crucial, with 61% of global companies expecting to have only one year or less to execute their AI strategy before facing considerable negative business consequences due to lagging behind.

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FORECASTS SUMMARIES

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THE POWER GRID NEEDS AN OVERHAUL FOR ELECTRIC CARS Investments in the power grid are an opportunity to develop the eMobility sector in Poland.

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POLAND IS CATCHING UP WITH LEADERS Compared to the German market, some trends in the scale of the eMobility market become evident. The German electric car market grew from 54,000 vehicles to a whopping 680,000 in five years. Comparatively, it registered an annual growth of about 85%, and according to 2021 data, electric cars accounted for 26% of newly registered vehicles in Germany.

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he share of the eMobility segment in Poland is constantly increasing, offering prospects for reducing greenhouse gas emissions and smog in cities. However, this poses several challenges, with the most significant being the need to develop distribution networks and introduce legal facilitations for new connections.

In 2017, only 3,000 electric cars were on Polish roads. However, by the end of the third quarter of 2022, according to registration data, there were almost 55,000 such vehicles, also representing a significant 73% increase in the analyzed period.

The share of electric vehicles among all passenger cars in Poland (19 million) is only 0.04%, while in Germany, it is already 2%. However, development forecasts are optimistic. According to estimates, by 2030, Germany will register around 15 million electric vehicles, and Poland will have nearly 1 million. This change must be linked to the expansion of charging infrastructure.

As of the beginning of 2022, Poland had 2,500 public charging stations, mainly concentrated in large cities, such as Warsaw, which accounts for 30% of them.

Compared to Germany, where only 10% of all 57,000 stations are located in such areas, much remains to be done.

NETWORK OVERLOADS The increasing number of electric cars and the need to expand charging station networks lead to peak load growth and increase the likelihood of overloading power grids.

Charging points in the same circuit can cause uneven energy consumption, increasing the differences between peak and off-peak demand. This situation is a significant challenge for distribution system operators. The response to this challenge is proper infrastructure planning, considering local network conditions and connection implementation times. Stoen Operator in Warsaw follows this approach, as it is responsible for the area's electricity distribution.

On the one hand, the consumer expects a constant availability of maximum network power, even though they do not fully utilize it.

On the other hand, the Distribution System Operator (DSO) is obligated to secure such power. Therefore, already at the network planning stage, we need to estimate the power required for a given location.

To do this, we estimate the number of potential consumers or analyze how specific parts of the city will develop. It is a complex computational process.

ENERGY SECTOR TRANSFORMATION ALONGSIDE NETWORK INVESTMENTS Another significant issue is the time required for new grid connections, including those for new charging points. In Poland, this process averages around 15 months. In comparison, connecting a new charging station in Germany takes only 9-13 weeks. For investors, the long waiting The increasing number of period inelectric cars creases the and the need risks associated with to expand price charging sta- the level for tion networks goods and lead to peak services. load growth In Poland, and increase higher the likelihood legal, and of overloading regulatory barriers power grids than in our Western neighbors often influence the prolonged waiting time for new connections. This not only hampers the development of charging station networks and the eMobility market but also, in a broader perspective, negatively impacts urban development.

The trend in Poland and Warsaw is that more power is needed. We

are receiving increasingly more applications for network connections, but this is directly related to the economic development of both Warsaw and Poland. More and more new residential and industrial investments are being created. Throughout the country, we aim to solve the problem of power shortages. We need to achieve two main things: firstly, expand network investments, and secondly, digitize the system and the network, as well as meter the demand side.

The distribution network system and the network of electric vehicle charging points are connected vessels. This means that new consumer connections also translate into new opportunities for charging stations.

An important initiative currently undertaken by Stoen Operator is the expansion of the RPZ (distribution point) station in Falenica, which will allow us to achieve a higher connection limit.

In Poland, the development of the eMobility market is still in the early stages due to the relatively low share of renewable energy sources in the national energy mix. It remains below 20% of installed net generation capacity compared to 60% for Germany. Therefore, developing the charging station network is as crucial as facilitating new connections to the grid and further transforming the energy economy. A significant change in the electric mobility sector can only occur when there are solid foundations for energy production with a high share of renewable energy sources. The growing popularity of the eMobility sector provides promising prospects for Poland to achieve this goal in the coming years.

Expert Agnieszka Franiak, project management specialist at Stoen Operator, SN/nN Network Development

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FORECASTS SUMMARIES

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TOO EARLY FOR A BREAKTHROUGH IN CEE REAL ESTATE On an annual scale, the commercial real estate investment market in Central and Eastern Europe is experiencing a slowdown. However, a quarter-to-quarter comparison has shown a slight increase. of transactions concerning purchasing industrial properties in Poland and Slovakia. Office properties absorbed the highest capital value (€657 million), followed by industrial (€467 million) and retail (€349 million). The residential market attracted €69 million, and the hotel market attracted €51 million.

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recorded lower investment values.

The rental housing market stands out, having increased by 72% during this period, as well as hotels, where the value of invested capital was 16% higher than in the same period in 2022. Investors are primarily waiting for developments in the inflation situation and decisions regarding interest rates.

In the third quarter of 2023, the commercial real estate investment value in the Central and Eastern European region saw a 42% decrease compared to the same period last year. The amount invested in such properties from July to September this year was €1.6 billion. A total of 82 transactions were completed, each with an average value of €20 million.

There were a record number

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Expert Monika Kulawińska, Deputy Director in the Capital Markets department at CBRE

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rom July to September this year, the value of invested capital amounted to €1.6 billion, 3% more than in the previous quarter, according to CBRE data. The largest share was in office properties (41%), followed by industrial (29%) and retail (22%).

CBRE observations indicate that investors are still closely monitoring the market in the region, but their actions are inhibited by inflation and high-interest rates.

In the commercial real estate investment market, investors are still cautious. Despite a marginal increase in capital levels on a quarter-to-quarter basis, it is still challenging to discuss any breakthrough. Compared year-over-year, in the third quarter of this year, most sectors in the CEE region

Out of the €1.6 billion invested in commercial real estate in the third quarter of this year in the CEE region, Poland attracted the highest capital value: €741 million. The Czech Republic and Slovakia ranked second, with €215 million and €214 million, respectively. Southeastern European countries gained €170 million in capital, and Hungary received €132 million.

Lithuania, Latvia, and Estonia recorded €80 million in investments.

Romania had the weakest result in the last quarter, with investors placing €62 million euros in commercial real estate.

Reduced interest in commercial real estate investment is a global trend. Our region is not an exception. Although the scale of the decline has many reasons, it is worth noting that one of them is the higher focus of investors from Western Europe, Asia, and the US on their own markets compared to before.

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LONG LIVE OFFICES! 2023 hasn’t been an easy year for the office sector. However, what is most important is that companies have now become convinced that you cannot effectively run a business without offices, and the remote working model will not replace hybrid work or office jobs.

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hroughout 2023, we saw a further fall in supply in all of the country’s cities.

This unfavorable trend was not only caused by limited demand but also by the high costs of construction and finishing work and the difficulties in securing project financing. Warsaw has already entered a supply gap, which, at a minimum, could last another year but may be even longer. Between January and September 2023, only 20,300 sqm of office space came onto the Warsaw market, the lowest-ever figure in history.

At the end of the third quarter, almost 263,000 sqm of offices were under construction, of which Ghelamco’s projects accounted for nearly a quarter. These include the ultra-modern and ecologically sustainable tower building, The Bridge (47,000 sqm.), and VIBE (15,000 sqm), the only office building in Poland with a musical DNA. By the end of this year, the first of these projects will have reached a height of 40 stories, while the second is now at an advanced stage in its construction and will be ready to be handed over for use in the first half of 2024. The high number of tenant inquiries we have received means we are already considering launch-

ing more projects in Warsaw.

The situation in Poland’s regional markets looks a lot less favorable. From the beginning of the year till September, almost 240,000 sqm of office space was delivered, with a further 50,000 sqm to be handed over before the end of the year, feeding a rising vacancy rate. Two of our projects, which are currently being commercialized, are among the biggest developments: Craft (26,700 sqm) in Katowice and KREO (24,000 sqm) in Kraków. Our buildings will be the first in Poland’s regional cities and the first in the CEE region to be certified under the SmartScore and Wired Score, which will confirm the highest standards for the intelligent systems applied within them and for their technical infrastructure.

We saw rising tenant activity at the end of the third quarter of 2023. As a result, the vacancy rate in Warsaw maintained a downward trend. It is currently estimated to be around 10%, which is a healthy figure for the market. The recovery in demand is undoubtedly being strengthened by a more rational approach to remote work and the continuing popularity of flexible workspace. In Warsaw, which in this regard takes first place, more leases were signed than over the same period of 2022. Our transactions also prove how well the city's office market is doing. In 2023, the tenants that joined Ghelamco included Imperial Brands, Andersen, RWE Renewables, OmniOffice, and Chilliflex.

Tenants are currently looking for offices that meet ESG standards – that are green, sustainable, and energy-efficient. Together with location, these aspects have become crucial in decision-making.

A project such as our Warsaw UNIT is the best example of this. It is the first building in Poland to be awarded a WELL Core certificate with a Platinum rating and a BREEAM rating of Outstanding. Because of its ultra-energy-efficient Building Energy Management System, it uses almost 30% less power than other high-rise buildings of its type.

We are waiting to see how the macroeconomic situation in Poland and the rest of the world will develop in 2024 and to see if interest rates will fall, which will positively affect the commercial real estate sector. Political change, as well as the release of funds from the National Reconstruction Plan (KPO), will be a powerful boost to the economy's growth and will also allow the business environment to stabilize – and as everyone knows, big business likes stability and predictability.

Expert

Jarosław Zagórski, Managing Director of Ghelamco Poland

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WHAT RECRUITERS DO AND WHAT CANDIDATES EXPECT The candidate market is a reality for an economy with low unemployment. Recruiters must respond to the expectations of candidates to fill gaps in various positions and acquire new talent for companies.

POSITIVE ATTITUDES IN THE RECRUITMENT PROCESS While 67% of surveyed representatives from recruitment departments believe they actively consider applicants' experiences, only 44% of specialists and 59% of physical workers share the same opinion.

Notably, compared to the 2021 study, there has been a slight increase in the percentage of candidates (a rise of 3 percentage points for specialists and 5 percentage points for physical workers) declaring that they perceive a focus on positive experiences in the recruitment process from employers.

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room for further improvement in candidate experiences.

REMOTE VS. ON-SITE The disparity is also evident in the question about the form of recruitment. There is a difference of opinion among candidates regarding the preferred method. Specialists (61%) significantly more often than physical workers (45%) prefer recruitment processes that include remote stages or are entirely conducted online. Notably, 40% of physical workers prefer a traditional recruitment process that takes place entirely on-site. On the other hand, a significant majority of employers (80%) declare that at least some stages of recruitment in their companies are conducted remotely.

Only one in five employers opt to maintain the traditional, entirely on-site recruitment process.

A flexible approach to organizing recruitment meetings can bring significant benefits, such as increasing the chances of attracting the most valuable candidates.

INFORMATION FLOW Further areas where the expectations of candidates need to align with the practices of recruitment departments are visible in the information exchange area. For

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example, only 32% of employers provide information about salary in job offers, while more than 80% of candidates expect this information at this stage of recruitment. Moreover, only 15% of recruiters included information about the duration of the recruitment process in the offer, which is a requirement for about two-thirds of candidates.

TRANSPARENCY IS ESSENTIAL The report analyzed what candidates believed should be the focus for improving the recruitment process. Every fourth specialist and physical worker emphasized that the most critical area for improvement was a transparent and honest presentation of working conditions at the company and in the specific position.

If they were to choose one important issue to change, it would be this. On the other hand, 29% of specialists and 14% of physical workers indicated a preference for better communication related to informing candidates about why they were not selected for a job or the next stage of the recruitment process.

Expert Martyna Wasilewska, Marketing Expert at eRecruiter

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oes this mean that recruitment departments are offering what job seekers want? The eRecruiter report "Candidate Experience in Poland 2023/2024" reveals several apparent differences between what companies do and what the market expects.

The fundamental difference is already noticeable when analyzing employers' opinions on meeting the needs of applicants. There is an apparent discrepancy between the views of representatives from recruitment departments and candidates' opinions.

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PREMIUM APARTMENTS STILL IN DEMAND Luxury apartments in Poland only take up a small percentage of the market. They stand out with their unique locations, but equally important are their distinctive designs and the wide range of amenities that buyers have come to expect. In recent years, the application of ecological solutions has become a further essential criterion for a project to be classed as luxury. Modern luxury is the possibility to live in harmony with the environment.

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he residential market in Poland is becoming ever more similar to that in Western Europe. With the economy's growing strength and the rising number of affluent Poles, the country's premium and luxury real estate markets are also maturing. The demand for this type of investment can be found in the most developed urban centers such as Warsaw, Kraków, and the TriCity; however, investing in the resorts has also become popular, with prices per sqm reaching recordhigh levels and sometimes even exceeding those in the big cities.

Since the premium segment is far less sensitive to crises and changes in lending policies, it provides a very attractive investment opportunity; however, what can be offered for sale is limited by access to unique sites. What is important here is the developer's experience and understanding of the needs of the more savvy customer, who is prepared to pay extra for the right address, a view from the window, and buildings of a high standard.

We see a place for new luxury projects in Warsaw since Ghelamco's flagship projects of this type, such as Foksal 13/15 and Flisac Apartamenty Powiśle, have already been sold out. Any customer who today would like to buy a luxury

apartment in the center of Warsaw can only look to those sold by their previous owners or apartments still in the design stage. Our response to the supply gap in this segment is a new project in the center of Warsaw – a renovation to breathe new life into an exceptional building from the 1930s.

Another trend we see in the premium real estate market is that customers are choosing a more sustainable way of life and are looking to balance living in the city with being close to nature.

The modern idea of luxury also includes extraordinary surroundings for a development, particularly when long journeys are not required for going to work, to school, or into town.

Groen Konstancin is an example of such a development, with houses built between the PAN Botanical Garden and Kabaty forest within the Konstancin administrative district, a town that is well-known as a prestigious health spa. This multistage project has attracted many inquiries from potential customers who often choose such locations for the healthy air, the recreational amenities, and the many other advantages of the area.

Looking beyond Warsaw next year, we also plan to add a luxury project in Gdynia to our sales. This

development, which is like no other in the region or anywhere else in the country, is currently under preparation and – to let you in on a little secret – it is to follow a modern urban concept which will include a view of the sea, the beach, and the marina. This will make it perfect for those who love both sailing and the best in design. We plan to begin sales next year since we can see a significant supply gap in this market, and interest in luxury among the affluent has not waned.

Expert

Jarosław Zagórski, Managing Director of Ghelamco Poland

WBJ.PL

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FORECASTS SUMMARIES

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AI AND CYBERSECURITY PUSH DIGITAL TRANSFORMATION AMID UNCERTAINTY Artificial intelligence is where more and more companies invest and how they expect to achieve their short-term goals.

Interestingly, most organizations plan to achieve them on smaller budgets than before. Cybersecurity concerns are the driving force behind digital transformation.

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lmost two-thirds of companies (63%) believe investments in technologies such as artificial intelligence and cloud contribute to increased profits and improved efficiency.

Data analytics, cloud, XaaS models, artificial intelligence (AI), and automation were most highly regarded in this regard. The largest group of surveyed organizations noted that technological investments contributed to profit increases or improved performance in their companies by over 10%.

Simultaneously, management’s acceptance of implementing new technologies has tripled, from 10% to 38%, over the past year.

According to 57% of respondents, AI and machine learning will be the key technologies enabling the achievement of short-term business goals in the next three years. The drive for technological progress in companies arises from the need to ensure cybersecurity and high levels of customer service, as indicated in the “KPMG Global Tech Report 2023,” with the participation of 2,100 leaders and industry experts responsible for technology in firms.

BUILDING A COMPETITIVE ADVANTAGE

businesses may be easier than before, as the need for digitization is now well recognized by the management. In the last 12 months, the percentage of respondents declaring support from top leaders for implementing new tools has nearly quadrupled.

Unfortunately, high uncertainty has become a permanent element of the economic landscape, and according to the old saying, a downturn is the best opportunity to take bold actions that will build long-term advantages, especially in today’s digital age, mainly in artificial intelligence and ESG technologies.

TRANSFORMATION BUILT ON TRUST Critical motivators for companies to advance technologically and invest include ensuring high levels of cybersecurity, building customer engagement, and managing ESG areas. As many as 62% of surveyed firms believe that managing risk at early project stages, including security and control considerations in the design phase, significantly increases the chances of successful digital transformation. On top of that, over 63% of organizations claim that raising the level of cybersecurity and privacy protection helps ensure customer loyalty.

Achieving set goals in digitizing

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TECHNOLOGICAL RACE AND UNCERTAINTY One of the more interesting results of this year’s study is that despite the strong commitment of most organizations to digital transformation strategies, the fear of losing the technological race with other market players turned out to be an essential factor in choosing technologies. As many as 45% of surveyed companies prioritize artificial intelligence and machine learning because they believe that market competitors have already implemented these technologies.

A key element of effective digital transformation is setting clear goals, and appropriate business alliances help achieve commercial and strategic results. Economic uncertainty remains a barrier to dynamic digitization. Due to the financial situation, respondents admit they feel less confident about investing in new technologies. Moreover, two-thirds of respondents complain that they are expected to achieve more significant results with a budget smaller than a year ago.

Expert Dr. Grzegorz W. Cimochowski, Partner, Head of Consulting at KPMG in Poland.

Partner Spotlight

ASSESSING THE CHALLENGES OF 2023 AND LOOKING AHEAD TO 2024 The economic situation in 2023 has forced all businesses to look for solutions that will reduce costs. Fluctuating fuel prices, high inflation, and the associated economic slump translating into reduced consumption and consequently stagnant volumes are just a few of the so-called "black swans" that are, unfortunately, causing the prices of products and services to climb.

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he market is not growing, but costs are. In addition, without investments that drive the economy and provide new opportunities, it will be difficult to break the unfavorable streak. What is the remedy? It is essential to take a comprehensive approach to the market as a homogeneous organism, where individual units interact with each other. The entire supply chain should be involved in optimization, as only such action will bring tangible benefits in the long run.

It's not about drastic cuts but about effectively making process changes that allow savings for everyone. By this, I mean the logistics operator, consignor, and consignee of shipments. Synergy, cooperation, and partnership between all participants in the supply chain will undoubtedly bear fruit and help the market face its challenges. This is what the new dimension of logistics is all about - focused not only on core competencies but also on the complementarity and permeation of the shared priorities of each link in the supply chain. A supply chain is a chain of interdependencies, and a well-executed one-step determines the success of the following link.

As Fresh Logistics Polska, we greatly emphasize the development and quality of our services.

We operate in fresh food sector, where products are characterized

by a short shelf life. Thus, we cannot afford to make mistakes. Despite the many challenges posed by the market, including the high rate of increase of the minimum wage or the German MAUT affecting the prices of imports or exports of goods, the priority for us is to maintain quality at the highest level. It is crucial for the fresh produce industry. The consumer demands that there will be fresh cheese, vegetables, or fruits on the store shelf every day, and we are the ones who make sure that they get to the store in a perfect condition. We are aware that food safety, quality, and timeliness are non-negotiable and are certainly not aspects to be spared.

A conscious customer realizes that apparent savings may only sometimes bring the expected results. It is vital to conduct a dialogue with customers and work out a standard solution to preserve the continuity of any business in the face of a challenging market situation, but not at the expense of quality, because in the long run, this may not help but cause the opposite effect.

Therefore, in 2024, we will focus on finding new development potentials, innovation and continuously optimizing processes to increase productivity and efficiency in various operational areas. In the face of rising costs, it will be

crucial to create awareness that the price offer is only the tip of the iceberg, behind which lies much more. Behind the price is not only carriage of goods but also quality assurance, efficient communication to eliminate risks in delivery, monitoring, relations with trade networks, etc.

Expert

Tomasz Olenderek, Managing Director, Fresh Logistics Polska, Raben Group

WBJ.PL

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FORECASTS SUMMARIES

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HOW WILL ARTIFICIAL INTELLIGENCE IMPACT THE JOB MARKET? SALESFORCE PREDICTIONS FOR 2024 Office workers estimate that generative artificial intelligence will save up to five hours per week. This new trend presents a new and exciting opportunity for companies, enabling them to leverage their teams' creativity, strategic thinking, and innovation on a much larger scale than before.

HUMAN PRODUCTIVITY As much as 60% of management believes they measure their team's productivity mainly by tracking activities such as hours worked or emails sent. However, this will change with the widespread use of artificial intelligence in the workplace. We will begin to see how AI replaces workers in many mundane, repetitive tasks that we have long considered productive. In the coming year, leaders will need to shift their thinking from measuring activity to measuring impact, e.g., focus on outcomes such as the number of products introduced or generating new leads rather than the labor required to acquire them. They will need to clearly define the results they want to see and support their teams in aligning individual efforts with these clear goals.

Christina Janzer, SVP of Research & Analytics, Slack

AI AUTONOMY The main goal for artificial intelligence in the coming year will be to gain as much autonomy as possible – wherever standard workflows can be automated. AI has tremendous potential to automate any mundane task – from order processing to bookkeeping and post-sales support. By identifying repetitive tasks and using data integration to make informed predic-

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tions and generate automation, AI is well-positioned to take over today's routine work patterns and free up our time for more satisfying, productive, and lucrative work.

Param Kahlon, EVP and GM, Automation & Integration, Salesforce

CUSTOMER SUPPORT Historically, low unemployment rates have exacerbated the problem of retaining customer service employees. Generative artificial intelligence can reduce the costs of their recruitment as it increases the level of self-service and improves the productivity of agents.

Ed Thompson, Market Strategist, Salesforce

LEVERAGING DATA AND AI The average office worker struggles with information overload.

In fact, working with data silos wastes over 11 hours per week.

In the coming year, we will begin to see the very real impact of generative artificial intelligence on how we work, interact with data, and think about productivity. It will start with capabilities such as AI-based knowledge search, which quickly extracts value from existing customer data. In the longer term, productivity outcomes will increase thanks to more advanced features of generative AI, such as task automation and the ability to anticipate

DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

trends and generate insights.

Jackie Rocca, VP of Product, AI, and Expansion, Slack

SMARTER WORKPLACE Chatbots and virtual assistants will simplify the employee experience by automatically booking, for example, office space suitable for the team's needs. Artificial intelligence will also provide quick answers to questions, guide employees to resources, and facilitate handling service requests. AI will increase proactive engagement and employee experience, anticipating employees' needs.

Relina Bulchandani, EVP, Real Estate and Workplace Services, Salesforce.

RISE OF AI-BASED WORKPLACES The greatest talents expect more from their employer than just salaries. Companies will focus again on workplace culture and supporting employees – both in the workplace and beyond. These investments will increase employee satisfaction, retention, and overall business success. Companies that choose to focus on these areas will remain leaders.

Expert David Ard, Head of Employee Success, Slack and Salesforce

Partner Spotlight

POLAND'S HOUSING RESURGENCE: BALANCING SUPPLY-DEMAND CHALLENGES Economic stability fuels a thriving housing market in Poland, but with demand surging against limited supply, property prices soar. Explore the dynamics of this boom and a leading developer's strategic initiatives poised for a productive year amidst market complexities.

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e have been witnessing a sustained revival in the housing market since the beginning of the second half of 2023.

The economy and geopolitical situation are stabilizing, and favorable, easily accessible financing is stimulating demand, leading to further increases in property sales.

The demand for housing in Poland – estimated to be in the range of 0.8 to 1.2 million units – combined with economic revitalization and rising wages, is, however, colliding with insufficient supply. Unfortunately, the imbalance is resulting in rapid property price increases.

Without any stimulating factors on the supply side, we anticipate that these trends will persist into 2024.

The upcoming 12 months will be a highly productive period for us.

We will conclude the implementation of three residential projects: the exclusive Bernadovo Apartments project in Gdynia, the Czysta 4 apartment building in Wrocław, and the Panoramiqa housing estate in Poznań. Simultaneously, we will continue the implementation of premium segment investments - Chmielna Duo in Warsaw and the multi-stage Cavallia residential complex in Poznań, developed in collaboration with Revive. In the coming year, we will also be actively preparing to launch new projects. We anticipate commenc-

ing the construction of a new investment in Warsaw in the first quarter of 2024. The upcoming year will also be a time of intensive land acquisitions for projects that we will be implementing in the following years. Our primary focus is on purchasing plots where we can expand our activities in the premium segment.

Expert

Béranger Dumont General Manager of BPI Real Estate Poland

WBJ.PL

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FORECASTS SUMMARIES

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PROPERTY PRICES ARE RISING, BUT NOT AS FAST AS FEARED Chief Analyst Bartosz Turek Sheds Light on the Record Gap Between Seller Aspirations and Buyer Realities in Poland's Housing Market.

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n the third quarter alone, housing prices increased by 5.4%, according to the latest data from the National Bank of Poland. While it is indeed more expensive, it's not as costly as online listings suggest, as evidenced by the record gap between seller expectations and buyer offers. Evidence suggests that in 2024, increases may slow down.

In the third quarter of 2023, Poles paid 8.3% more for apartments in the largest cities than in the same period the previous year, according to the latest NBP data on changes in secondary market home prices (the Hedonic Index for seven cities). In just three months, rates increased by a substantial 5.4%, resulting from a rapid surge in demand that outstripped supply by several months.

MORE CITIES WITH FIVE-DIGIT PRICES PER SQUARE METER

POLES CHOOSE CHEAPER APARTMENTS Data published by the central bank at-

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SHUTTERSTOCK

Contrary to appearances, changes in the primary market were less spectacular.

The average rate per square meter in the seven largest markets increased by 4.3% quarterly and 6% year-on-year, according to preliminary NBP data.

After these changes, we now have five provincial capitals in Poland where you must pay over PLN 10,000 per square meter for second-hand properties. These cities include Gdańsk, Gdynia, Kraków, Warsaw, and Wrocław.

Moreover, because of developers' higher standards, apartments in these cities usually cost more.

Partner Spotlight

tracts particular attention because it is the most reliable and accurate in showing what is happening with housing prices in Poland. Therefore, the data should cool housing market sentiments. While the publication confirms significant increases in apartment prices, today's available data suggests that they were not as drastic as feared. Recently, speculation about housing prices imagined increases of more than twenty percent. However, the NBP reported increases of something far less, around 6-8% annually.

How did these discrepancies arise? Firstly, the data published by the NBP was preliminary and did not summarize the entire third quarter, only the first two months.

Secondly, the NBP shows transactional price information rather than listing prices. The difference is fundamental. Listing prices are those found in advertisements.

They were easily accessible and most often widely commented on in the media. In recent weeks, Poles heard of price increases of ten to slightly over twenty percent within a year, over and above the existing PLN 15,000 to 17,00 per square meter for apartments in Kraków and Warsaw.

However, this is only partly true. The fact that someone would like to sell an apartment for that much does not mean that buyers are willing to pay. Buyers typically choose cheaper apartments, while the listings usually include more

expensive proposals and those related to higher standard properties. Before negotiations, listing prices are significantly higher than transactional prices.

DWINDLING SUPPLY As if that were not enough, the supply of available apartments has recently dwindled. There are about 25% fewer properties to choose from now than at the beginning of this year. The cheaper apartments were sold first, artificially raising the average listing price. Since more affordable apartments are missing from the listings, and expensive properties are in them, this increases the average rate.

RECORD GAP BETWEEN LISTING AND TRANSACTIONAL PRICES Information about the buyout of listings and the record mismatch between sellers and buyers accompany NBP-published data. The average listing price in the seven largest markets is PLN 12,600 per square meter—almost PLN 1,800 more than the average price actually paid for apartments (PLN 10,800). Never before have we seen such a large numerical discrepancy.

In specific cities, this difference can be even more shocking. For example, in Krakow, sellers were demanding almost PLN 14,200 per square meter in the third quarter, and buyers paid PLN 11,800, i.e., PLN 2,400 less. In Warsaw, the average listing was PLN 14,900

per square meter, and for apartments that actually sold, it was PLN 12,600 per square meter, i.e., a whopping PLN 2,300 less, according to NBP data.

THE MARKET SHOULD REGAIN ITS BALANCE NEXT YEAR While we should expect data on dynamic price increases in the central bank's upcoming publications, there is already hope for a return to relative normalcy.

The situation should start to calm down as early as next spring. On the one hand, we see signs of increasing supply and, on the other, normalization of demand.

The data suggest that supply has risen to the challenge posed by demand. Developers, seeing an increasingly large group of buyers, are starting more and more new projects. Statistics from the Central Statistical Office (GUS) consistently report a growing number of construction starts by developers since July. Information for October also contains heartening reports in a publication prepared by Otodom Analytics. It states that October was the first month since the beginning of the year when the number of homes introduced to the primary market was almost as much as the number of homes sold. If this state can be maintained, the pressure on housing price increases will decrease.

Expert Bartosz Turek, Chief Analyst HRE Investment Trust

WBJ.PL

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Partner Spotlight

FORECASTS SUMMARIES

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RESIDENTIAL REAL ESTATE BOOM IN 2023: HIGH DEMAND, LIMITED SUPPLY Surging demand meets constrained supply, driving up prices and intensifying market competition. 3CityInvestors experts advise swift investment decisions amid a dynamic market landscape.

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n 2023, the residential real estate market experienced a notable surge in demand compared to the same period last year. Analyses conducted by experts from the esteemed investment firm 3CityInvestors, namely Krzysztof Ciszak and Paweł Szydłowski, also revealed only a modest uptick in supply.

A pivotal driver behind this dynamic upswing in client interest within the real estate market is the reduction of interest rates, fostering a favorable climate for prospective investors. Government initiatives easing the acquisition of mortgage loans further contribute to this trend, making financing for property purchases more accessible.

However, despite an uptick in supply, it’s worth noting that the current pace of supply falls short of market’s expectations.

This dynamic has translated into accelerated price growth and a constricted availability of offers. As Paweł Szydłowski from 3CityInvestors highlights, “prime properties are finding new buyers swiftly, and the limited quantity of available offers intensifies market competitiveness.”

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Given the current landscape, experts from 3CityInvestors strongly advocate for swift investment decisions for all those eyeing participation in the real estate market. Foreseeing no imminent drop in prices due to the market’s sustained momentum, they also note that actions taken by development companies to amplify the number of offers were somewhat belated, with effects expected in a timeframe of at least two years.

Krzysztof Ciszak from 3CityInvestors underscores that “in the face of current market conditions, a rapid response may prove pivotal for achieving satisfactory investment results.”

The real estate market in 2023 is marked by significant growth, primarily propelled by mounting demand. Nevertheless, the limited supply has triggered price hikes and placed substantial constraints on the availability of offers. Experts from 3CityInvestors believe prospective investors need to act rather than wait for an increase in supply, as waiting may entail a considerable delay, and that the effects of delay on supply are difficult to predict.

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Experts

Krzysztof Ciszak and Paweł Szydłowski, Real Estate Market Experts, Management 3CityInvestors

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FEATURE

BEYOND BORDERS: FDIS DRIVE POLAND’S GROWTH & TRANSITION Poland’s future promises continued growth driven by the twin transitions of energy and digital transformation. Yet, as Polish Investment Zones (PSI) are added to the special economic zones (SEZ) spreading over the entire state of Poland, what are the long-term ramifications for an economy injected with large amounts of foreign capital?

BY SEAN REYNAUD

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FEATURE

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N 2023, Poland saw the largest Foreign Direct Investment (FDI) project announced in its history: Intel’s commitment to constructing a Semiconductor Integration and Testing Facility in Miękinia, Lower Silesia, amounting to €4.2 billion.

According to Intel, “This facility will help meet critical demand for assembly and test capacity that Intel anticipates by 2027.”

This development emphasized the substantial growth of Poland's high-tech sector. The Polish Investment and Trade Agency (PAIH) estimated that Poland witnessed an investment of nearly €7 billion in 2023, doubling the figures from the previous year.

“Thanks to Intel, Poland is entering a new sector of the economy. With this investment, Poland becomes a key player in the semiconductor market, aiming for a 20% share in global semiconductor production by 2030. The impact extends beyond Poland to the entire European Union, making Central Europe a new driving force,” said Marcin Graczyk, press officer, Polish Investment & Trade Agency (PAIH), the organization credited with making Intel’s investment possible.

Other significant projects, like Umicore and Volkswagen’s PowerCo investing nearly €1.7 billion in Nysa, showcase Poland’s potential in electromobility.

“Electronic conglomerates and companies associated with the automotive industry, including those producing components for electric cars and batteries, are transferring production to Poland. Recently, investments from machinery and building materials sector companies are also being observed,” said Radosław Sowiński, an expert in strategic relations at BGK, Poland’s development bank.

Robert Bosch, a German company, will invest €400 million for two projects, including the construction of a heat pump factory near Wrocław. Mercedes has also announced its plan to build the world’s first purely electric plant, an electric van factory, in Jawor, Poland, with a value of €1.3 billion. Combustion engines have been in production in Jawor for Mercedes since 2019, and its battery systems have been in production since 2021.

American companies UMA Investments and Footprint Poland have invested PLN 456.7 million and PLN 411.2 million, adding 660 new jobs to the Łódź Special Economic Zone. One of the benefits of this investment is the cargo railway network that connects Łódź to Chengdu, China.

Footprint, a packaging company that uses plant-based fiber alternatives to plastic, has announced the construction of a paper packaging factory for $86 million.

Assuming a stable trend in growth in the coming years, FDI may amount to as much as PLN 208 billion by the end of 2024, according to a recent PwC report.

But what accounts for these investments? Where are they investing?

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GLOBALIZATION IS ADAPTING

The uptick in recent investments reflects the changing nature of globalization, the climate crisis, Poland’s membership in the EU, and the education of its workforce.

“Disruptions in supply chains, driven by events like the COVID-19 pandemic and the war in Ukraine, prompt businesses to explore new, safer collaborations. Nearshoring gains popularity, benefiting stable economies in Central and Eastern Europe, particularly Poland,” said Graczyk.

“The country's appeal grows for innovative industries, with e-mobility, BSS-IT, and R&D projects thriving.

Poland's safety and strategic location make it a hub for global companies like Visa, contributing to economic development and knowledge exchange,” he added.

Reshoring manufacturing operations closer to customers proves economically sound and aligns with environmental goals by curbing carbon emissions associated with overseas shipping. Still, the materials for production remain far removed from industrial areas.

What has changed is the flow of data and know-how.

Olivia White, director of the McKinsey Global Institute, stated in a recent podcast, “In general, regions that are manufacturing regions depend very strongly on the rest of the world for resources: food to some degree, but really energy and minerals.”

Poland’s investment attractiveness goes beyond infrastructure, with its well-developed roadways and underutilized modern industrial and warehousing stock. It's mainly about the people. “Professional services and IP are growing fast,” White added.

Professional services, like engineering, are experiencing a 6% annual growth, outpacing slower growth in resource-related flows. Intellectual property (IP), including movies and music, is growing even faster – but accounting for digital IP is challenging.

ARE THE ‘ASIAN TIGERS’ PAYING IT FORWARD? Poland’s benefits have caught the attention of Japanese companies, with over 300 investment firms now operating there. Pilkington Automotive has invested in the Tarnobrzeg Special Economic Zone (SEZ) with plants in Sandomierz and Chmielów. Daikin Manufacturing, investing PLN 1.471 billion in the Łódź Special Economic Zone (ŁSEZ), has contributed to the region’s growth by creating 810 new jobs. This area encompasses Łódź, Masovia, and Greater Poland.

But the Japanese are not alone. Other Asian economies, like Korea and Taiwan, are lining up too.

Taiwan, Poland’s seventh-largest trading partner, has substantial investments in the country, particularly in the semiconductor sector. ASE Technology Holding Co., a key player in SiP (system-in-package) modules, has been deeply involved in Poland’s automotive industry since 2018 and is currently constructing its second chip factory near Wrocłow, which is expected to be operational in 2024.

In addition, Taiwanese chipmaker MediaTek established a research and development facility in Warsaw in early 2023, while TSMC actively seeks engineers in Poland to support the growth of its silicon photonics endeavors. These developments underscore the significant presence and contributions of Taiwanese semiconductor companies in Poland’s technological landscape.

South Korean companies, including LG Electronics and Heesung Electronics, have made significant investments in Poland, with 600 Korean companies helping solidify the Republic of Korea as the second-largest non-European investor in Poland. SK Nexilis Poland, a South Korean company, invested over PLN 2.6 billion in 2021, establishing production for copper foils used in electric vehicle batteries and generating 333 new jobs.

In 2021, South Korea emerged as Poland's largest greenfield Foreign Direct Investment (FDI) contributor, investing €364 million and creating 5,414 new jobs.

The collaboration between South Korea and Poland expanded with manufacturing agreements for military equipment and a nuclear power plant.

Korea Hydro and Nuclear Power (KHNP) proposed the construction of six APR-1400 reactors, aiming for a total capacity of 8.4 GW, scheduled to be operational by 2033, and replacing coal-fired power stations that contribute up to 73% of Poland’s electricity.

“With Poland still largely reliant on coal for its energy, it will be interesting to see how quickly the country can make the switch to renewables given Intel’s commitments to use 100% renewable energy by 2030”

WHAT DOES THIS MEAN FOR POLAND?

Poland’s highly educated workforce could easily manage data flows and IP at a time when they are sorely needed, and it is far cheaper than in countries like the United States. Furthermore, three of the four categories Oliva White identifies as evolving throughout the global supply (semiconductors, electronics, pharmaceuticals, and the mining of critical minerals) are those areas that require a well-educated workforce, like that of Poland.

“Poland emerges as a top global market for IT outsourcing, driven by a shift in perception from offering cheap labor to providing highly skilled professionals. The country actively welcomes know-how from established market players and contributes innovative technologies. The growing pool of highly qualified talent, especially in engineering and R&D, positions Poland as a key player supporting the development of tech giants like Microsoft and Google,” PAIH’s Graczyk explained.

>>> WBJ.PL

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FEATURE

IT’S BEEN A LONG TIME COMING The success of Polish FDI attractiveness didn’t come overnight.

Following the Act of 1994, Special Economics Zones (SEZs) were established mainly in post-industrial, economically excluded areas with high unemployment. This resulted in a total coverage of about 0.08% of Polish territory. Despite offering investors multiple incentives within designated Special Economic Zones, what really accelerated FDI growth was creating a nationwide Polish Investment Zone (Polska Strefa Inwestycji or PSI) in 2018.

“The Polish economy is in a completely different place today than it was five years ago when the Polish Investment Zone was established. Today, the entire country is one large investment zone, and Poland has become a good place to do business,” said Minister of Development and Technology Waldemar Buda.

INCENTIVES ABOUND The old SEZs still exist, and permits to do business in these areas are valid until 2026. The amendment of 31 July 2019 allows government support for those willing to extract undeveloped mineral deposits. But by 2023, PSIs were added to include nearly the entire nation, with the establishment of 14 zones.

Almost 70% of PSI investments are now located outside former SEZ regions.

According to Poland’s Ministry of Development and Technology, the Polish Investment Zone has garnered PLN 109.5 billion of declared investment value from September 2018 to the end of August 2023. Over 45,000 new jobs resulted after the enactment of a law in May 2018 that aimed to establish a much larger area for PSI. Only in Jan-Aug 2023, By the end of August of this year, 288 support decisions were issued, with an investment value of PLN 10.8 billion and the creation of an estimated 4,700 new jobs.

Entrepreneurs within the PSI benefit from tax relief and public aid in the form of income tax exemptions (CIT or PIT) of up to 70% of the value of the investment. Of course, the amount of relief depends on the region and its socio-economic situation.

GREENFIELD AND BROWNFIELD The process of foreign direct investments is complicated.

Brownfield investments (purchasing shares entitling up to 10% of the votes on a board, allowing an investor to quickly enter a market by benefiting from existing facilities or infrastructure) and greenfield investments (building an entirely new entity and/or facilities) both allow for quick integration into the Polish market. Poland accounted for 25% of greenfield investments in the CEE region in 2022.

FDIs positively impact productivity in the host country and allow for an increase in the host’s export income. FDIs often introduce technology transfers and standards related to work organization and production, which benefits the host country.

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The influx of foreign capital leads to an increase in labor productivity, with increases in the competencies of the local workforce over time. Foreign investments usually translate into more than proportional growth in the overall value of investments in the host country. There is a complementary relationship between foreign and local investments, especially with the help of economic zones.

WHAT ARE THE DOWNSIDES FOR POLAND? However, there are associated risks with FDIs that should be highlighted, and these risks can be quite substantial. Dependency on multinational corporations entails relying heavily on foreign companies, causing Poland to become excessively dependent on the operations and decisions of these multinational corporations. Consequently, this heightened dependency makes Poland susceptible to global economic fluctuations, which can impact the performance of foreignowned businesses and, consequently, the overall economic stability of the host nation.

Poland has gone out of its way to give tax breaks to incoming FDIs, but does it balance out? The repatriation of profits by foreign-owned businesses may drain financial resources from the host country, limiting funds for local development projects. Additionally, FDIs may contribute to income inequality, as the benefits, such as job opportunities and higher wages, might be unevenly distributed, resulting in a widening wealth gap.

Environmental concerns arise when foreign companies do not adhere to the same environmental standards as domestic businesses, leading to degradation and sustainability issues. For some companies, like Intel, business deals come with a twist on the environmental front, as outlined by Glenn Barklie, chief economist at Investment Monitor, “With Poland still largely reliant on coal for its energy, it will be interesting to see how quickly the country can make the switch to renewables given Intel’s commitments to use 100% renewable energy by 2030. On this front, we have seen strong, recent growth in inbound renewables FDI in Poland, particularly onshore wind and solar power.”

Moreover, foreign investors, particularly large corporations, can wield significant political influence, potentially compromising the sovereignty and decision-making autonomy of the host government.

While it feels like we should be excited about FDIs in Poland, perhaps some caution is warranted. Incentives were extended to Intel and other companies to stimulate economic growth in Poland and potentially evade the middle-income trap common in rapidly developing economies. However, with the World Bank reporting a GDP per capita of $18,321 for Poland, it appears that the country has successfully overcome the challenges associated with the middle-income trap.

Expert view

WHAT WILL 2024 BRING? It seems that the prospects for 2024 are promising for Poland. Despite the global economic slowdown observed in recent years and ongoing market uncertainty, international companies will continue to invest in the Vistula region. This is influenced by the so-called twin transition process, involving simultaneous energy transition (aimed at increasing the share of renewable energy sources in the energy mix) and digital transformation.

Shortening and securing supply chains are critical trends related to the influx of foreign direct investments. Companies operating in the international marketplace are moving factories closer to consumer markets and investing in technologies that make supply chains more autonomous. These trends are further supported by growing environmental challenges, prompting entrepreneurs to optimize flows within the supply chain and operate more extensively in local markets. Locating factories closer to consumer markets also reduces the manufactured product's carbon footprint.

The trend of nearshoring and relocating production closer to target markets, which we observed this year, will continue to play a role. Some companies opted for nearshoring after disruptions in supply chains during the pandemic and due to increased geopolitical risk after the outbreak of the war in Ukraine.

International corporations prefer investing in countries with a large and thriving domestic market, as it facilitates finding buyers. Poland’s main advantages as an investment-receiving country, including its attractive geographical location, developed infrastructure, educated expert workforce, and low labor costs, should continue to attract foreign investors. Not surprisingly, Poland, Turkey, and Morocco are countries identified by analysts as potential primary beneficiaries of ongoing changes.

- Radosław Sowiński, Expert in Strategic Relations at BGK

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THE YEAR OF LLMS COMES TO A CLOSE. WHAT’S NEXT? As the year of AI comes to a close (Chat GPT debuted on November 30), the market is picking up speed. We can see several frontrunners taking on new challenges, like a Wrocław University-led consortium working on a Large Language Model akin to ChatGPR based on open-source technology but explicitly trained for the Polish market. >>>

UNSPLASH

BY BEATA SOCHA

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Brand24, a leading social media marketing firm, is building its own AIpowered assistant. Michał Sadowski, Brand24’s CEO, has been vocal about harnessing the power of AI in marketing, particularly in social media. He recently released a number of social media viral videos (befitting a company whose bread and butter is monetizing social media for their clients) where he spoke several different languages using AI tools to provide not only real-time translation in his own voice but also alter his facial muscles for the speech to appear legitimate.

It shouldn’t be surprising that 38% of Polish professionals who employ AI in their daily work see it as a potential threat to their livelihood.

Meanwhile, Cisco’s report highlights the urgency companies feel to jump on the AI bandwagon and not to be left out in the cold, as well as the areas where Polish firms lag behind. While most Polish firms feel confident about AI talent they have among their staff, and 91% claim to actively train their employees in AI technologies, many admit that their infrastructure, particularly data sources, are too poorly integrated to take advantage of AI analytics.

On the global front, we’ve seen some Hollywood drama-worthy power shifts in OpenAI’s leadership, with Sam Altman being fired over the firm's future direction, only to be rehired less than a week later, with the full backing of its top investor, Microsoft. The power struggle sent shockwaves throughout the AI world, with many wondering where the creator of ChatGPT will take us next. Some say that the currently leading mind in AI is tired of tweaking a product that is already good enough and would instead like to pursue a more lofty goal: creating an Artificial General Intelligence that could actually supervise its own learning process and potentially surpass anything we’ve seen thus far.

It has been a truly thrilling year for tech enthusiasts, and I’m convinced most of us are impatiently waiting for the next season. See you in 2024.

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DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

AI

Poland launches its Large Language Model A free, open-source intelligent assistant, trained explicitly in Polish, is being developed by a consortium led by Wrocław University of Science and Technology. The consortium includes State Research Institute NASK, Information Processing Center – State Research Institute (OPI PIB), Institute of Computer Science PAN, University of Łódź, and Institute of Slavic Studies PAN. The language model, named PLLuM (Polish Large Language Universal Model), aims to address the scarcity of models trained on representative Polish language datasets.

The initiative aims to provide businesses with a model featuring an expanded Polish language on a free, open-source license to meet market demands.

The creators seek to overcome issues observed in popular models, such as ChatGPT, which may lack exposure to the Polish language during training, leading to errors in cultural and historical contexts.

The project aims to support both businesses and citizens.

AI

Brand24 focuses on building AI-powered assistant Brand24 is focusing on building an intelligent assistant based on AI. The company plans to concentrate on further AI implementation and development. In Q4, the company aims to introduce geolocation features and expand the “comparison” panel. Long-term plans include strengthening the international position and integrating the chatbot with OpenAI’s marketplace.

A mere 6% of organizations in Poland are fully prepared to implement artificial intelligence (AI), according to the Cisco AI Readiness Index.

Globally, 61% believe they have a year to implement an AI strategy before significant negative business impacts, with 47% in Poland sharing this view. The study reveals proactive measures, with 95% in Poland having or developing an AI strategy, mainly focusing on IT infrastructure and cybersecurity.

SPACE

AI

Thorium Space launches work on Polish telecom satellite in collaboration with ESA

Only 6% of Polish firms are ready to implement AI solutions

In mid-November, Poland officially joined ESA’s optional programs, and

Thorium Space joined the HummingSAT initiative for small geostationary telecom satellites. The collaboration aims to develop a fully Polish Small GEO national satellite with an innovative Thorium payload. SwissTo12 is involved in adapting the GEO satellite platform. The project, valued at around €75 million, receives combined funding from ESA. SPACE

Scanway to cooperate with German space firm on multispectral satellites

ALL IMAGES THIS SPREAD SHUTTERSTOCK

German company Marble Imaging and Polish firm Scanway have announced a strategic partnership to jointly develop a multispectral payload for a microsatellite Earth observation constellation. Marble Imaging’s target constellation plans to deploy up to 200 satellites, each weighing around 100 kg, over the next decade for cyclic global imaging in very high resolution. Scanway will be responsible for developing and delivering the Earth observation telescopes onboard the satellites.

The collaboration aims to strengthen the European Earth observation industry and contribute valuable information to clients globally.

MOBILE PAYMENT

BLIK enters Slovak market Polski Standard Płatności (PSP), the operator of the BLIK system, has obtained

regulatory approval in Slovakia. After conducting test transactions, PSP expects to initiate the first production transactions by the end of 2023, marking 2024 as the year to establish a robust transactional foundation.

The company showcased test transactions in collaboration with Slovak banks in Bratislava. Additionally, PSP is expanding its operations in Romania with BLIK Romania.

ONLINE RETAIL

A third of Poles would consider shopping in the metaverse Santander Consumer Bank’s report indicates that 31% of Polish online shoppers are aware of the metaverse concept, a 13 point increase from the previous year.

Of those surveyed, 33% express a willingness to engage in metaverse shopping. The trend is more pronounced among men (42%) compared to women (22%) and respondents from larger cities with over 250,000 inhabitants (38%).

IT MARKET

IT salaries continue to climb, but slower in Q3 In the third quarter of 2023, salaries in the IT industry are showing signs of stabilization, according to data from No Fluff Jobs. While wages in the Frontend category remained in the range of PLN 16,000 to 22,000 net, the DevOps category saw a return to late 2022 levels, ranging from PLN 18,000 to 25,000 net. The report notes a significant increase in IT job candidates in 2023, with an average of 88 CVs sent per Frontend job posting, a 340% increase compared to 2022. Despite recent stabilization, annual trends still show salary increases, ranging from 11.1% to 19.4%.

TECH NUMBERS

35%

of Polish financial institutions have implemented cloud solutions across all areas

46%

of those currently not using the cloud plan to migrate their entire operations within the next 2 years

8%

of Polish institutions lack a cloud strategy, the highest among surveyed regions, vs 5% in CEE and 2% in EMEA (PwC)

38%

of employees using AI fear being replaced

40%

of AI users declare using it at least once a week, indicating a desire to enhance daily work efficiency.

(Deloitte)

41%

of Polish firms see EU cybersecurity regulations as a challenge, above EU average of 30% (IDC)

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DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

For more, visit wbj.pl

Have A Red & White Christmas Marketed at wine lovers, connoisseurs and lovers of the good life, dobrewina.pl’s wine workshops are the perfect solution for company integrations,family celebrations or gatherings with friends...

Course I The ABC of Wine

Answers the questions of what wine is, how it’s made, and how and where it’s grown. In this two-hour course, participants will also learn the vocabulary of the Aroma Circle, how to recognize different tipples by their taste and smell, and the basics of wine etiquette – how to open a bottle, store it, serve, etc.

Price: PLN 165 per person in a group of eleven (full amount: PLN 1,815 gross)

Course II The Secrets of Wine Aside from the points covered in the ABCs of Wine course, this 3.5-hour session explores rules for pairing wine with food, looks at how to make sense of bottle labels, and delves into secrets of wine production. Guests can choose from three flavor paths covering white, red, or regional wines.

Price: PLN 240 per person in a group of eleven (full amount: PLN 2,640)

Course III

ABOUT DOBREWINA.PL

Launched in 2001 by Peter Pulawski, Dobrawina.pl has since earned a reputation as one of Poland’s premier wine suppliers. More than just an online business, their HQ in a restored former stable makes for an atmospheric backdrop for tasting sessions conducted amid ultra-modern equipment that guarantees the optimal light and temperature levels needed for tastings.

dobrewina.pl Wyczółki 46, dobrewina.pl

World Classics On top of the elements offered in the above courses, this four-hour premium experience will also expand your knowledge of orange wines, vegan, eco, organic, and biodynamic wines while further looking at the most famous appellation systems and wine regions in Europe and beyond. Flavor paths that groups can pick from include ‘bubbles,’ whites from France, wines from different regions of either France or Italy or a deep dive into a specific region, such as, for instance, Chablis, Burgundy, Rhone, Bordeaux, Tuscany, Piemonte, Veneto or Puglia.

Price: PLN 300 per person in a group of eleven (full amount: PLN 3,300).

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Life + Style A CAPTIVATING OFFER FOR FESTIVE GATHERINGS AND CORPORATE EVENTS IN WARSAW!

W

hether you want to organize a private dinner with colleagues in a cozy setting or a grand company event during this festive season, you will be delighted by Chaton Warsaw's beautiful interiors and numerous attractions.

Renowned Chef Michał Miłoszewski has crafted a unique Christmas menu, blending traditional Polish dishes with intriguing flavors and a creative touch.

The restaurant's versatile 4-level concept, housed in a historic 100-year-old tenement on prestigious Foksal Street, provides the perfect space for private, business, and corporate gatherings. Each floor is uniquely designed, offering a broad spectrum of event possibilities.

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DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

Discover a unique "hot spot" in the capital!

The hottest destination for events and culinary delights in the Polish capital today, Chaton Warsaw boasts excellent cuisine, world-class entertainment, and exceptional live performances. From Tuesday to Saturday, Chaton provides artistic attractions and breathtaking shows. On the weekend, the highlight is the spectacular Dinner Show, a sensory feast with a delicious 5-course menu or à la carte selection, accompanied by talented singers, dancers, and acrobats from around the world.

Chaton is the place to be for those who appreciate the highest quality in art and cuisine. Chaton offers a dedicated Cigar Room and a private Diamond VIP Room to ensure even greater comfort for our guests.

During the festive season, we encourage you to choose Chaton for gatherings with friends or co-workers. Impress them in a new way at Chaton—where excellence in art and cuisine converge.

For more information visit www.ChatonWarsaw.com

EVENTS

The WBJ relives or looks forward to the most important events in the world of business and economy

THE 11TH EDITION OF THE EXECUTIVE INNOVATION FORUM IS OVER! The event featured four panel discussions and two presentations, where experts discussed the most critical issues related to digital transformation, artificial intelligence, and diversity in business. Commencing with a speech by Special Guest Mr. Vlad Winner, CEO and co-founder of Binom AI, the conference addressed diverse topics. The panel on the “Evolution of Innovation” explored the proper understanding of innovation and the importance of fostering an innovation culture within organizations. The first presentation, "Product Development in the Age of AI and the Protection of Intellectual

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Property," delivered by JWP Rzecznicy Patentowi, emphasized the need for legislative change to keep pace with technology and stay ahead of emerging trends. During the "Digital Transformation" panel, speakers highlighted agreed that transformation is an ongoing process without a definitive endpoint. Assessing its effectiveness requires a longer perspective, and criteria change over time. The Polish Agency for Enterprise Development, PFR Group, presented, "New European Funds for Enterprises."

More than €5.5 billion has been allocated for Poland as part of the funding for 2021-2027. In "The Power

DECEMBER - JANUARY 2023/24 WARSAW BUSINESS JOURNAL

of Artificial Intelligence" panel, speakers expressed concern that the implementation of artificial intelligence in Poland is going too slowly, advocating for systemic solutions instead of taking risks and investing alone. The final panel, "Diverse organizations," stressed the current shift in work culture. Companies increasingly support work-life balance, employee well-being, and creating inclusive workplaces. The event's climax was the "Innovation Diamonds" Gala, during which companies and individuals who distinguished themselves in the field of innovative solutions were recognized.