First, it's worth explaining the concept of commercial real estate. What exactly is it? Commercial real estate is a facility where one can conduct business or generate income from renting it out. Commercial real estate includes offices, warehouses, shopping malls, shopping malls, and so on. For a property to be called commercial, two conditions must be met:
- first: it must remain uninhabited
- secondly: it must be used to conduct business activities.
In contemporary construction, it's common to see combined buildings, meaning they serve multiple functions. They might have commercial spaces on the ground floor and residential spaces on the remaining floors.
Types of real estate on the commercial market
Commercial properties are among the most frequently sold properties (right after residential buildings). Potential investors have a wide range to choose from. What are the most popular types of properties on the Polish commercial market?
- Commercial and service premises
- Warehouses
- Production halls
- Real estate intended for offices
- Entire buildings (e.g. shopping malls, office buildings, hotels)
- Plots intended for commercial development
Based on the above examples, it is clear that commercial properties are those that are acquired for the purpose of generating profits: from renting or running a business.
Commercial real estate sales in Poland – what does it depend on?
The situation on the Polish commercial market is closely linked to what's happening not only in Poland but also globally. Commercial real estate sales have declined, undoubtedly influenced by the outbreak of the war in Ukraine , but not only that. Persistently high inflation and rising interest rates by central banks are also a factor. All of this has led to an increase in property prices, but also to an increase in all the expenses businesses incur related to the use of the premises (e.g., rent, electricity, and internet). It's no wonder, then, that investors are becoming more cautious about purchasing properties and waiting for the market to regain balance. In the meantime, it's worth keeping an eye on the market and monitoring properties that are already available.
Commercial real estate market in Poland – what influences it?
Among the factors that have the greatest impact on commercial real estate prices, three are mentioned: location, residence and supply, and the economic situation.
Location
Location is a factor that significantly determines the price of commercial real estate. It's generally accepted that properties located in city centers are typically significantly more expensive than those on the outskirts. Central locations attract investors due to convenient access and proximity to amenities.
Supply and demand
Real estate prices depend on supply and demand. If a region is experiencing economic growth, demand for commercial real estate increases. Supply, on the other hand, depends on the number of available units and investors' willingness to sell or rent them.
Economic situation
Inflation and the economic slowdown may cause investors to make more cautious decisions. Meanwhile, companies with tighter budgets will seek savings, for example, by choosing smaller, less expensive premises.
The commercial real estate market is a dynamically developing sector of the economy, offering opportunities for investment and business activity. The price of commercial real estate depends on many factors. Before making a decision to buy or rent, it's worth carefully analyzing all of them.
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