Limited land supply in large cities will in some cases force developers to implement investments in the lex developer formula, and this is inevitable. We expect that this type of projects will increase. We also carefully analyze properties with the potential to implement residential development in place of existing older service or post-industrial development in the way provided for in the lex developer. This is a multi-year and complex process, which is why our group's structure includes a specialized company, Develia Land Development, established for this purpose. We are currently conducting several such processes concerning properties located in the largest cities in Poland – comments Tomasz Kaleta, Managing Director for Sales and Marketing at Develia.
One of the examples of housing estates that were built in the lex developer formula is Lizbońska in Warsaw. We implemented it with the developer Grupo Lar Polska as part of a joint venture. Our partner was responsible for preparing the investment in accordance with this procedure and it was the first project of this type in Warsaw. From the very beginning, the implementation of Lizbońska was carried out taking into account the findings from the social consultations. The aim was to maintain consistency with the surroundings and care for the environment – he adds.
This special act did not meet the expectations placed in it by developers and did not significantly increase the number of new areas for development. Its rather insignificant impact on the housing situation in Poland is evidenced by the relatively small number of decisions issued in this mode, which will probably translate into approx. 35-40 thousand square meters of PUM nationwide, which is not much for a period of 6 years. Now, in view of the planning reform and the ending period of the lex developer, the fate of this instrument is sealed. Unfortunately, to the detriment of the development of the housing market, after all, the land for which this tool was adequate was most often located in good locations and, as, among others, post-industrial or commercial, was equipped with the necessary utilities and convenient communication – comments Mateusz Bromboszcz, Vice President of Atal.
Practice has shown that from the investors' point of view, lex developer is a very laborious, risky and ineffective process. The drawbacks were not only the procedures for adopting, including the frequent negation of city resolutions by other bodies, but also the provisions that did not fit the realities, e.g. the top-down parking rate (1.5 spaces), which was especially unjustified in city centers. Another problem was often the lack of experience on the part of cities regarding effective and transparent methods of conducting social dialogue, or principles defining the rules of investor participation in the expansion of necessary infrastructure; not only network, but also educational and other. As a result, the potential and benefits that this tool had for municipalities in the field of housing development were not used, despite the wide scope for consultation and participation. The special act itself can be an excellent tool for cities and conscious authorities to shape urban spaces in a way that reconciles the stakeholders of investment processes and residents, and it is their responsibility to select tools and conduct the entire process in a way that builds trust in the municipality and the investor.
Despite this, there are attractive areas with great potential, worthy of transformation and increased work and time, which involves demolition and changing the function. A good example of this is the Atal investment in Gdynia at ul. Kcyńska. We acquired land there after one of the retail space operators who had ceased operations in Poland. We are implementing a large residential project Atal Symbioza there. The advantage of the place is its good location and transport connections, and due to the previous operations, also the availability of infrastructure and media. These are also advantages that could convince developers to invest in this type of investment.
The lex developer formula, which enables the implementation of residential investments on land previously used for office or commercial development, opens up new perspectives for the real estate market. This type of project can be particularly profitable in locations with high demand for apartments, where access to attractive, undeveloped plots is limited. We are considering using the lex developer formula as one of the ways to increase the scale of investment. Due to the growing demand for apartments and limited availability of attractive plots, this type of solution can be an important element of our development strategy. Construction on land in the lex developer formula is a strategic direction that can significantly increase the scale of our operations, especially in cities with high demand for apartments. We are ready to adapt our projects to these new opportunities, taking into account the profitability and quality of the investments implemented – comments Damian Tomasik, CEO of Alter Investment.
Dawid Wrona, Chief Operating Officer at Archicom
In our opinion, the construction of city-forming, multifunctional and modern investments in places that have so far been characterized by less aesthetic and functional development is a good idea for sustainable development of cities. As part of the Modern Mokotów investment in Warsaw, we have committed to building not only residential or commercial buildings, but also a public school and a linear park. In this way, we are revolutionizing the area of post-industrial Służewiec, i.e. in the area to which the label of the so-called capital Mordor has been sewn over for years. By demolishing office buildings in the area of Wołoska and Domaniewska streets, we are changing the concreted spaces into a green and vibrant project with apartments, services, gastronomy, a linear park and zones for recreation and rest – comments Dawid Wrona, Chief Operating Officer at Archicom.
We are currently also at the stage of public consultations on the further development of the space at al. KEN 14 in Warsaw's Kabaty. Our ambition is to create a new local center of Kabaty in this place, which will become a comfortable place to live, meet and relax with a central point in the form of a city square – Kabaty Market. We are the beneficiary of this type of approach to urban transformation, because we see huge urban potential in it.
The lack of land for residential development is a major problem that the entire housing industry is struggling with. As a strong and stable developer, we have our own land bank and are currently investing in projects that are under implementation. We decided to buy out old buildings and transform them a few years ago, when we purchased former factory land for the construction of the unique Fabrica Ursus housing estate. Part of the residential development will be made up of fragments of the former Ursus factory, which are under the protection of the conservator of monuments. Construction of approx. 800 apartments, ranging from 35 to 100 m2, located in 6-7-storey residential buildings, has already started on a 2.5 ha plot – comments Mariola Żak, Sales and Marketing Director at Aurec Home.
There are two new projects on the horizon, namely the My Forest and My River housing estates located in Warsaw's Białołęka district. In the first case, residents will have a private forest at their disposal, in the second – a river.
The Act on Facilitating the Preparation and Implementation of Housing Investments and Associated Investments, known as Lex Developer, is a tool supporting the implementation of housing investments. We are taking advantage of the benefits of this law by implementing a project on the premises of the former Ursus factory hall. There, we plan to create nearly 1.5 thousand modern apartments and associated infrastructure, such as a school, nursery, kindergarten and cultural space.
However, we know from the current law that the amendment to the Spatial Planning and Development Act, which implemented the planning reform in the autumn of 2023, shortened the duration of the lex developer by three years, i.e. until the end of 2025. Due to the limited duration of the act, we are not considering the purchase of new residential land related to this right. If the act is extended, and such talks are ongoing, we are considering the possibility of expanding our investment activity in this area.
The availability of plots for further investments in large cities, where demand significantly exceeds supply, is significantly limited. Hence, we are looking for and developing a land bank based on interesting, often non-obvious post-industrial land. The implementation of the first stage of the FSO PARK investment in Warsaw's Praga Północ is assumed as part of the so-called Lex developer procedure. It would be the largest implementation of this type in the history of the capital. This phase will cover almost 13.5 ha, on which approx. 2,000 apartments, approx. 60 commercial and service premises, a fragment of the central park, as well as a public primary school for 650 children built at our expense, which would be transferred to the local government. The commencement of work within this phase of the investment is planned for 2025 and may take approx. 10 years – Marek Starzyński, Sales Director, Okam Capital.
This year we also signed a preliminary agreement securing land in the Warsaw metropolitan area, where we assume the possibility of building about 1,000 apartments. We also contracted a plot of land on former factory land in Łódź.
Acquiring land for purposes other than residential for the implementation of housing projects is one way to reduce the housing crisis. Many plots and buildings constructed on them were developed based on old local plans which, in turn, did not provide for certain directions of development of cities or their regions. They require revision – comments Zuzanna Trzebata, Sales Director at Eco Classic.
