A year ago, if you had asked real estate lawyers what they would expect to be doing in a global pandemic, the majority would have told you they would probably have very little to do. We expected to be reading books, attending webinars and waiting for a light at the end of the tunnel. However, the reverse has turned out to be true. A combination of people reconsidering their life plans, a huge amount of pent up demand in the market, low interest rates and the growing demand from foreign investors, has led to an extraordinary amount of activity on the real estate market in Poland.
2020 will undoubtedly go down in history as a momentous year. COVID-19 has brought many concerns, limitations and changes. Governments, businesses and communities have and still need to deal with the ongoing uncertainty. Companies cannot determine the duration of the pandemic's impact on their business, operations and strategy. Businesses are taking a conservative approach to decisions related to office demand strategies and all other activities which may continue until the COVID-19 situation stabilises.
In the long term, companies and the office market can draw conclusions for the future based on current experiences. Perhaps, new rules introduced to both social life and the real estate market will endure and modify the way we live and work. Attitudes to remote working, sustainability initiatives and technological advances will change. It remains to be seen.
In the meantime, Poland is growing and expanding fast. The current period is called the golden age of Polish real estate market. Warsaw will soon be home to the tallest building in the EU: At 310 meters (1,017 feet), the Varso Tower is slated for completion in 2021. It’s but one of a dozen skyscrapers going up in Warsaw over the next two years.
Foreign investors have growing interest in investing and acquiring real estate in Poland. This applies both to commercial and residential property. People purchase the land to conduct their business activity or to conduct real estate business in Poland or simply wish to purchase and own real estate in Poland as investment. They all should be aware of the legal provisions on conditions of implementation, orders and procedures of the transactions in order to minimize the risk.
If you are buying, a good real estate lawyer and an experienced surveyor is a must. It is important to evaluate the legal status of the property, the owner of property, whether property is in dispute or subject to additional requirements of government before the deal is done. In addition, the lawyers can help you to draft or review the agreements, sales contract as well as the process to legalize the purchase to comply with the law in Poland. To sign the good deal you need to have a good deal structure. Going for the simplest solution (i.e. money in exchange for the property from the seller) is probably the worst structure. You have to structure the transaction in the way that you de-risk it. De-risking means that you lower the risk and not over-pay. There are many ways to achieve it.
Good surveyors are also very important in your team. They will work collaboratively with your lawyers to ensure the due diligence on the property you are acquiring is rigorous and thorough. They will make sure your lawyers have the information they need to obtain all the necessary answers and documents from the seller’s team. A good surveyor will also help you and your legal team to interpret the information received in light of the practical physical attributes of the property. They will also be able to quantify the risk of any issues revealed so you can make quick decisions on how and whether to move forward.
To sum up, it is worthwhile to try. A new world order is emerging from the pandemic and it’s a great opportunity for investors.
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