PINK Association (The Polish Chamber of Commercial Properties) brings together developers, investors and commercial service providers of the real estate market. The main goal of the association is to influence the legislative action that directly affect its members and represent them in relationship with authorities.
How did PINK come into formation and how would you describe the association’s main mission?
We started PINK on a backdrop of misunderstandings with the Ministry of Finance, regarding the level of taxation for transactions conducted on the real estate market. The association is intended to act as a mediator between authorities and real estate commercial companies, and we position ourselves as experts who can offer valuable know-how from inside the industry, both regarding the issues we face and the solutions that could mitigate them. We also organize workshops and courses to spread the knowledge and help connect Polish and foreign professionals in the field. PINK's mission is to shed light on the real estate market in Poland and bust some of the myths (e.g., that international investors are here only to make a quick profit). We want to educate the public about the multiple social and financial benefits this industry sector has in the larger context of everyday life.
Would you say that, nowadays, the level of taxation is encouraging to real estate business in Poland?
Certainly, in the past there were less regulations strictly focused on real estate and for the last four years, we have been trying to close the gap regarding the special income tax. The main goal is to make the rules well balanced from the industry's perspective, but some of the regulations are still too burdensome for the players, creating a certain level of uncertainty in the market. The level of taxation is not as dire as it used to be, but we still have to explain to the authorities that the uncertainty of "how much" and "when" need to completely disappear for transactions to work smoothly.
Are there any specific pieces of legislation that you are fighting for at this point in time, to improve upon?
We started working with the government on the REITs regime (again) because this was an ardent issue for members and we wanted to solve it. The authorities put together a multi-ministerial technical team that will introduce the new regulations in the near future, this being a positive signal from their part. A slightly smaller, but still troubling issue of the industry is represented by the new set of rules that allow telecommunication providers to enter buildings without owners' approval. While we understand the need for direct access, this regulation is detrimental, to say the least.
In Poland, the real estate market is dominated by international investors (more than 90%) - why do you think this trend exists and is there a blockage that prevents local companies from investing?
15 years ago, in Poland there was not enough local capital and we don't have a regime which allows the creation of vehicles in which private investors can invest (like a REIT). As the market matured, it naturally became a place for international players because the investments were too significant for local ones.
The actual real estate market is the result of a historical lack of Polish capital coupled with defective institutional laws. There is also a psychological reason behind this trend, since, in the past, Polish individual investors preferred the residential sector because they couldn't grasp the particularities of the commercial market.
What would be some of the challenges the pandemic posed to your members and how did you help mitigating them?
PINK has joined forces with developers and office investors to promote the importance of office activities and how they are vital in a well-functioning society. Even though working from home is a perfectly adapted solution to the current context, we want to also emphasize on the benefits of working from an office. Retail owners have suffered a lot during the pandemic and we continually tried to sustain our members, though the authorities need to also play their part.
Looking more broadly towards the future - where would you like to see PINK Association in two-three years' time?
This is an excellent question, especially in the context where we are hopefully talking about a horizon in which the pandemic is well behind us. We definitely want to be a trusted and recognized representative of the real estate industry both by industry players and authorities and media institutions. We are interested in setting a certain B2B standard (regarding professional conduct, ecological measures or quality systems) that is to be followed by all companies of the industry. Commercial transactions on the residential market are in need of regulation because this has been the most active sector for the last two years and the issues are surfacing only now, as more commercial owners are taking up a growing market share.
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