Local Partner at White & Case in WarsawMarket overview
Originally Published in March 2020
A factor that has undoubtedly contributed to the stability of real estate transactions in Poland is the legal institutions that give investors far-reaching legal security for their investments. However, the verification of the legal status of real estate remains of fundamental importance, including for the economic efficiency of an investment and risk minimization. In recent years, investors have been more and more willing to invest in new types of assets that cannot be clearly assigned to any of the typical real estate classes, such as apartment hotels, condo hotels and mixed-use investments. In the future, these “new” assets will likely attract significant interest. In such projects, thorough due diligence and careful legal and tax structuring are equally important.
In Poland, such investments are almost impossible other than through the application of the provisions of the Act of 24 June 1994 on the Ownership of Separate Premises. Despite certain difficulties, these provisions allow the creation of multiple-owner real properties. There are also court rulings confirming the interpretation of the Act or other acts allowing investors to structure their projects effectively under the existing provisions of law, even though they were not drafted specifically to apply to such “new” assets.
Another positive development regarding Polish statutory law expected in 2020 is the planned amendments to construction regulations whose fundamental aim is to make it easier for investors to obtain construction permits. That, combined with a functional legal system, provides a basis for optimism for the future.