Demand is as high as it was in the heady days before the Euro2012 football championship, when Poland was building stadiums, airports, railway stations and motorways at an unprecedented pace. According to GUS, the national statistical office, construction output in January 2018 was 37.4% (!) up on the same month in 2017. Just as in 2011-12, the boom is driven in part by EU funds earmarked for infrastructure, but also by private investment in commercial and residential real estate. And if this isn't overheating the market, the government's Mieszkanie+ programme aims to build significant numbers of new affordable housing units ahead of the next parliamentary elections.
Yet, according to Deloitte, compared to 2011-12, there are 100,000 fewer people working in construction – 380,000 compared to 480,000. Wages are going up, as are raw material prices. Many contracts that were costed and started last year are in coming into financial difficulty as they reach the final phases. Budgets are running thin. [Click here for short summary and link to Deloitte report]
This issue of Contact Magazine Online looks at the state of the construction and real estate sector in Poland today, to see whether the current boom doesn't contain the seeds of the next downturn. [See articles from CFE, here, and from Gleeds, here.] As the EU infrastructure funds come to an end, will there be a repeat of the situation the sector experienced in 2015-16, where a dearth of public investment led to a massive contraction of output?
Human resources are becoming a critical limiting factor in the further growth of the construction sector right now. What are firms doing to address the need for skilled people, from project managers to bricklayers, carpenters and electricians? [Hays Executive looks at the struggle to recruit and retain top people in the sector, here.]
Much hope is placed around the implementation of Building Information Modelling (BIM); the shift from drafting projects on paper to managing the entire process using IT. This means 3D models containing full information about every part of the structure (warranties, instructions, maintenance schedules, energy use) shared between architects, engineers, builders, owners and facilities managers, available on the cloud. BIM allows the entire industry to work smarter, not harder. For Mieszkanie+ it would allow for ready-to-go templates that can be adjusted to local conditions. In office developments, infrastructure projects, factories, schools, hospitals it means less time and labour wasted fixing problems that go undetected when designing on paper. The UK government, having mandated the use of BIM for all construction and infrastructure it procures (since April 2016) says it means 'build five, get one free', and estimates savings in operating costs over a building's lifetime at around 30%. BIM for Poland? Read more [from Europtima, here and coverage of the BPCC's BIM conference at the British Embassy with AECOM here].
Another technology with the potential to change the way we build is the perovskite crystal, a translucent photovoltaic material that can be used to generate electricity when applied to windows. Skanska [read here] is working with a Wrocław-based R&D company to mass-produce perovskite, creating a new way to make builders more energy-efficient and carbon neutral.
The Polish government is tackling some of the underlying problems that hamper development, the main one being spatial planning. Only 30% of Poland's population lives on land covered by a spatial plan. What's the answer? How can Poland prevent urban sprawl? One article looks at the legal changes that have come into force on 1 January this year [SDZ Legal, here] and the draft investment act that will affect spatial planning [Taylor Wessing, here].
Disputes between investors, developers, contractors and the construction supply chain are commonplace and costly. Two articles [from the Royal Institution of Chartered Surveyors and from the Mediation Centre] look at alternatives to taking a dispute to court.
The demand-side of construction is the real estate market. As more and more buildings reach completion, clients for commercial and residential property delight in the fact that there's more supply, there's more choice, and higher quality developments are on offer. In this issue of Contact, we will be able to read about the office market [from Savills, here] and the residential market [from Hamilton May, here]. A novel approach to offering low-cost rented accommodation in Poland is explained by Habitat for Humanity Polska [here].
Keeping employees happy and healthy is crucial to staff retention. How should you plan your office space to ensure the optimal well-being and engagement of your people? Two articles [one from CBRE, here, and one from JLL, here] guide you through the dos and don'ts of office layouts, so as to make your employees want to come to work on Mondays!
Investing in a new production facility in a new market may be daunting. This article [from PM Group, here] is a handy step-by-step guide to the process from the planning stage to execution. Naturally, BIM is a useful tool with which to build your new factory!
Finally, two articles go into the details of property management – considering the building as an asset that needs to be maintained and updated to keep its value, and how best to approach this. Articles from Colliers, [here], and Knight Frank, [here]. Then again – maybe you don't actually need your own office building (or as much office space as you think you might need). An article from Regus looks at the latest – revolutionary – trends in managing workspace [here].
The lead interviews in this issue of Contact are both with women with top jobs in British companies present in Poland's construction sector. Barbara Radziwon is managing director of Flowcrete for Central and Eastern Europe, a fast-growing flooring specialist [read interview here]; Magdalena Szulc is business unit director, Central Europe of SEGRO Polska, the property investment and development company, maybe better known to British readers as Slough Estates Group, [read interview here].