Echo Investment is one of the largest real estate developers in Poland focused primarily on the residential and commercial segments. It has been on the market for over 25 years and has over 1.5 million sqm under construction.
In 2016 you took over the leadership of Echo Investment and brought a new vision to the company - what were the main ideas that you wanted to pursue then?
After successfully working for 14 years at Skanska in CEE, when I took over leadership at Echo Investment my main goal was to achieve profitable growth. In this pursuit, we opted for a multifaceted business with an accent on creating destination projects with residential, offices, retail, hotels, food & beverage, student housing, etc. In the last four to five years, we shifted our focus towards multi-functional projects. The goal is not only to build something new, but also reinforce the existent cultural aura around these new projects (e.g., Warsaw Brewery). The idea of repurposing and reintegrating them in modern life is homage to their glorious past.
You mentioned that your focus is to integrate your projects in the wider city landscape, what sort of effort does this entail?
Bringing together historical buildings with our new complexes first off means working closely with local authorities to make sure we are preserving the cultural potential while bringing forgotten part of the cities back to life Another important aspect is to include as many green spaces as possible, as a way of bringing back nature into the city. Our philosophy is based on self-sufficiency: the residential or commercial centers contain all the necessary facilities to keep you entertained and content 24/7.
Looking at your activity nowadays, which of these real estate sectors tend to drive most of your business and how do you decide if a project is worth it?
At the moment, we are in top three in the office sector in Poland, and we are constantly implementing new solutions so that people can return to work safely. The benefits of human interaction prevail and all in all we believe the office segment will remain a growth driver in the medium and long run. The retail sector is reinventing itself, shifting towards food & beverage and events. Residential is also holding strong and will stay a pillar for Echo. When we decide whether a project is worth it or not, we look at how much we already invested in that sector and what types of projects best fit demand and bring additional value to the end client. Also, the return on investment is a vital aspect of every new venture we start.
It helps not to have all your eggs in one basket during any crisis, what kind of impact did the pandemic have on your operations nonetheless?
Referring particularly to the lockdown period we've experienced, we faced challenges related to obtaining building permits without a properly digitalized system. I think both us, the developers, and the authorities need to find a way to cooperate in this new reality. Also, at the very beginning we faced difficulties to maintain our productivity level high due to the general uncertainty that floated around. But by personal example and by visiting the construction sites, I managed to instill a feeling of safety and keep the projects going.
Business wise, in 2016 we decided to diversify and this helped us during the pandemic because we took all the opportunities that came our way. For example, we bought four sites with Tesco shopping centers in Poland and we are working to convert them into multifunctional destination projects. Also, at the moment we are expanding our residential sector and as the Echo-Archicom group this year we will start the construction of 7,000 apartments, both for sale and rent. Since during this pandemic people couldn't travel or spend money on leisure, their savings funds increased. Feeling the need to place their money somewhere safe, they instinctively chose to invest in the residential sector, which is palpable and reassuring.
Culturally speaking Poles are more inclined to buy than rent it, why do you think this trend has started shifting?
About four years ago, we performed a study and found that "flexibility" was the watchword. Younger generations are constantly travelling and changing homes. The rental market in Poland is mainly privately owned, so we wanted to offer an alternative institutional renting system with all the facilities included (maintenance, food delivery, permanent assistance, etc.).
Looking towards the future, what ambitions do you have for the coming 2-3 years?
We intend to keep our office sector at the same level and grow our residential segment as much as possible. We usually plan things on a much shorter period of time (12 months) because it's important to have an agile business in an ever-changing market. We are constantly looking at the long term strategy where one of the big things will be our Resi4Rent portfolio that will in 2-3 years have completed and ongoing projects in the amount of 10 000 apartments.
Do you have a final message about Poland’s real estate market?
Poland is without a doubt a very attractive investment market, and it keeps making way for new players. Sectors are emerging or transforming (e.g., residential for rent) and this facilitates a dynamic economic backdrop. Echo investment will continue to bring new businesses into the market and make sure that we are staying as the market leader in the segments where we are being present.
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