According to global advisory firm Cushman & Wakefield, commercial real estate transaction volumes in Poland reached nearly €5 billion (approx. PLN 22 billion) in 2024. While this figure reflects strong performance, it’s still below the market peak of €7.2 billion in 2018 and €7.6 billion in 2019. Notably, foreign capital continues to dominate, accounting for approximately 91% of all transactions — despite a gradual increase in the activity of Polish firms. One major reason? Poland has yet to implement REITs (Real Estate Investment Trusts), unlike neighboring countries like the Czech Republic, where they are already successfully in place.
Trillions in Household Savings, But Limited Investment Tools
According to data from the National Bank of Poland (NBP), Polish household savings exceeded PLN 2.3 trillion in 2024, with over PLN 1.2 trillion held in bank accounts — much of it in low or non-interest-bearing accounts. Another PLN 200 billion is kept in cash.
Most Polish households are seeking flexible investment options, especially for amounts starting from several tens of thousands of złoty. While bank deposits remain popular, other flexible tools include government bonds, retirement savings products (like IKE or IKZE), and mutual fund units — though the latter may be less accessible to the average investor.
Real estate investments lack liquidity, but they offer the potential for higher returns, especially when selling after a few years. Wealthier individuals often buy residential or commercial properties for rental income. But what about the rest of society, those who want to invest smaller sums safely?
Poland’s Untapped Potential for REITs
With billions in idle, non-interest-bearing savings, Poland could greatly benefit from a new, stable, dividend-yielding investment instrument tied to safe assets such as commercial real estate. In Western Europe and across CEE, investment products based on real estate — such as REITs, property-backed loans, or collective savings schemes — are widely used. This is particularly true in Czechia, the UK, and France, where local capital plays a central role in real estate markets, says Mira Kantor-Pikus, Director of Capital Markets and Alternative Investments at Cushman & Wakefield.
What Are REITs?
As explained by Bartosz Clemenz, Partner in the Real Estate Department at DWF Poland Jamka sp.k., REITs are publicly listed companies investing in commercial real estate that receive preferential tax treatment, provided they meet certain legal criteria.
There are two essential legal pillars to a functioning REIT framework:
- Defining REITs and eligibility criteria, such as:
- Legal form and minimum share capital
- Required percentage of assets and income from commercial real estate
- Dividend payout obligations (e.g., at least 90% of annual profit)
- Stock exchange listing and financial supervision requirements
- Tax legislation amendments, introducing full or partial tax exemptions for:
- Income from rental and sale of REIT-held real estate
- Sale of shares in REIT subsidiaries
- Dividends paid to REITs by their subsidiaries (subject to criteria compliance)
“We participated in drafting a six-page legislative proposal for REITs,” says Clemenz.
Despite years of discussion (since 2016), Poland still lacks REIT legislation. Talks resumed in 2023, when the Ministry of Development revisited initial assumptions.
Poland Is Ready — Legally and Economically
Poland’s legal and economic infrastructure does not lag behind EU countries where REITs thrive. The country has a mature real estate market, tax structures that could support such vehicles, a long-established stock exchange, and proper financial oversight bodies.
“The Polish real estate market is already mature and comparable to markets where REITs function successfully,” Clemenz adds.
Mira Kantor-Pikus stresses that real estate-based dividend products should be designed with non-institutional investors in mind, who may lack the expertise to independently assess individual properties.
She recommends introducing REITs with a requirement for a professional majority investor (e.g., 25%), with proven experience in Poland’s real estate sector, and boards of directors composed mainly of seasoned industry professionals. Property valuations should be done periodically by reputable appraisers, and management fees should depend on performance, based on metrics like EBITDA or NOI.
“This would prevent inexperienced companies from creating REITs,” she explains.
Why Investors Want REITs
The biggest motivator for investing in real estate is return on investment compared to other asset classes. With inflation eroding the value of money, many seek assets that offer inflation-hedged returns. Rental income, often indexed to inflation, offers such potential. In addition, reselling property may yield profits above original purchase value, says Kantor-Pikus.
She believes that REITs could benefit not only investors but also accelerate real estate market development.
“REITs and the activation of Polish investors could significantly boost the rental housing market, especially in smaller towns with supply shortages. The office, logistics, and retail sectors — particularly in regional cities — would also benefit through increased access to local capital and a more diverse investor base,” she concludes.
Source: CEO.com.pl – Article
