Poland Real Estate Market 2025: Trends, Prices, Yields and Outlook

Introduction and Economic Overview

Poland’s real estate market in 2025 remains robust and dynamic, supported by a resilient economy and strong investor interest. The country saw an exceptionally active 2024, with commercial property investment volumes more than doubling to over €5 billion (up ~142% year-on-year) content.knightfrank.com. GDP growth is forecast around 3–4% in 2025, driven by private consumption and investment cbre.pl. Inflation, which spiked in 2022–2023, is now on a downward trend, creating room for interest rate cuts cbre.pl. In May 2025 the National Bank of Poland (NBP) made its first rate reduction since 2023 (cutting the reference rate to 5.25%) amid improving inflation projections globalpropertyguide.com. Unemployment remains at record lows cbre.pl, and wage growth continues, bolstering housing demand and retail spending. This macroeconomic backdrop – moderating inflation, anticipated monetary easing, and solid labor market fundamentals – sets a positive tone for all segments of the real estate market in Poland.

Government policy has also been influential. A state-subsidized mortgage program, “Bezpieczny Kredyt 2%” (Safe Credit 2%), launched in mid-2023, significantly boosted home loan volumes (new housing loans in 2024 totaled PLN 83.9 billion, +43.2% vs 2023) globalpropertyguide.com. While it improved affordability for first-time buyers, it also fueled rapid house price growth, leading authorities to rethink support measures globalpropertyguide.com. Plans for a follow-up program were shelved in favor of a new initiative (“Pierwsze Klucze” or First Keys) aimed at helping first-home buyers purchase cheaper second-hand flats globalpropertyguide.com. Other proposed policies – such as taxing owners of multiple dwellings – have been debated and created some uncertainty for investors globalpropertyguide.com. Overall, however, Poland maintains a relatively open and investor-friendly real estate environment. The country is considered the most attractive market in Central-Eastern Europe for international real estate investors cbre.pl, with over 90% of commercial property investment in 2024 coming from foreign funds europaproperty.com. (Poland has been working on a REIT law to enable more domestic capital participation, but as of 2025 this is still pending, giving overseas investors an outsized role in the market europaproperty.com.)

In the sections below, we provide a comprehensive analysis of all major property types – residential, office, retail, industrial, and land – covering regional pricing trends, rental yields, supply and demand dynamics, policy impacts, key risks, foreign investment influence, and a 3–5 year forecast for each segment.

Residential Real Estate: Housing Market Trends and Rental Sector

Price Growth Moderates: After a period of frenetic growth, Poland’s housing market is moving toward stabilization in 2025. House price inflation has cooled from double-digit rates to more moderate single digits. In Q1 2024, the average transaction price of existing homes in the seven largest cities was PLN 13,404 per square meter (≈USD 3,460), up 8.1% year-on-year globalpropertyguide.com. New development (primary market) prices averaged PLN 14,265/m² (≈USD 3,686), a smaller +4.4% YoY increase globalpropertyguide.com. By Q1 2025, price growth continued to slow – reflecting higher financing costs and the fading impact of earlier subsidies – but remained positive. The table below shows average apartment prices in key cities as of Q1 2025:

Sources: NBP data for Q1 2025 globalpropertyguide.com globalpropertyguide.com.

These figures underscore the wide regional disparities. Warsaw remains the most expensive market, with average prices around PLN 16.4k/m² (~€3,500) globalpropertyguide.com. Other large cities like Kraków and Wrocław follow closely, while mid-tier cities such as Poznań and Gdańsk have mid-range pricing. Secondary cities like Łódź and Bydgoszcz are much more affordable – Bydgoszcz, for example, sees averages around PLN 7,400–9,400 per m², making it one of the cheapest major markets globalpropertyguide.com. In short, Poland’s housing market is highly segmented, with a roughly 2x–2.5x price gap between Warsaw and the least expensive cities.

Demand and Supply Dynamics: Housing demand cooled in 2024 under the weight of rising mortgage rates and policy uncertainty. According to JLL/NBP data, new home sales in 2024 across six largest city markets fell to 39,649 units, a steep –31% YoY decline globalpropertyguide.com. The first quarter of 2025 continued to see lower sales (9,100 units sold, –17.5% YoY), but the pace of decline has moderated, hinting at a stabilizing market globalpropertyguide.com. Developers responded to weaker demand by slowing construction starts, yet a record-high number of unsold units remains on the market in certain cities globalpropertyguide.com globalpropertyguide.com. For instance, Kraków and Wrocław have accumulated large inventories of completed but unsold flats, now facing similar imbalance as previously seen in Poznań globalpropertyguide.com. In Łódź, the stock is so high that at the current sales pace it would take over 2 years to clear existing new supply globalpropertyguide.com. Warsaw is faring better – it’s the most liquid market, with the shortest sell-off times – but overall buyers now have more choice and bargaining power than in the frenzied pandemic-boom years.

Several factors explain this cooler demand. Mortgage rates remain elevated (averaging ~7.5% for new housing loans in early 2025, down slightly from +8% highs in 2022) globalpropertyguide.com, pricing many buyers out. Would-be investors have been discouraged by discussions of higher taxes on multiple-property owners globalpropertyguide.com. And some households are waiting on government programs – either hoping for the revived subsidies or simply delaying purchases expecting price promotions or interest rate drops globalpropertyguide.com. Geopolitical worries (war just across the border in Ukraine) have also made buyers more cautious globalpropertyguide.com.

Despite the recent slowdown, experts do not foresee a crash, but rather a soft landing. Broad-based wage growth (Poland’s salaries have been rising in real terms) and an improving interest rate outlook are set to support housing demand going forward globalpropertyguide.com. An analysis by Otodom and Polityka Insight predicts that in 2025, sales will stabilize at a healthy level – not returning to the 2021 boom peak, but avoiding any major downturn or wave of developer bankruptcies globalpropertyguide.com. Similarly, developers like Dom Development note that “we anticipate the market moving toward equilibrium. We do not expect price declines; rather, price growth will likely align with or slightly undercut inflation” globalpropertyguide.com. In other words, housing prices are forecast to rise modestly (on the order of Poland’s CPI, which is ~4–6%), instead of the double-digit surges seen previously. The anticipated interest rate cuts in late 2025 could spur a renewed uptick in buyer activity and mortgage uptake globalpropertyguide.com, although any such demand jump may be tempered by the ample pipeline of unsold inventory that still needs to be absorbed globalpropertyguide.com.

Housing Deficit and Rental Growth: It’s important to note that Poland still suffers from a structural housing shortage – by various estimates, the country needs several million more units to reach Western Europe’s per capita housing stock levels cbre.pl. This underlying deficit, coupled with high migration into Poland (including Ukrainian refugees and foreign workers), underpins long-term demand. In the rental market, Poland traditionally had a small private rental sector, but this is rapidly changing. Rental demand has soared in recent years due to a mix of factors: younger generations preferring mobility, high home prices and credit costs pushing people to rent, and the influx of Ukrainians seeking housing since 2022. As a result, rents have climbed and rental yields have improved.

As of early 2025, rents are still rising, though at a gentler pace than before. Actual rents for housing were up ~4.2% year-on-year as of April 2025 (down from 5.4% a year prior), according to Eurostat’s Harmonized Index of Consumer Prices globalpropertyguide.com. A market survey by Otodom found the average asking rent in Poland in March 2025 was PLN 3,581 per month ($925), about 2% higher than a year earlier globalpropertyguide.com globalpropertyguide.com. This average had actually eased from late-2024 levels (it was the lowest since September last year), suggesting that the post-pandemic, post-refugee rent spike is leveling off globalpropertyguide.com globalpropertyguide.com. Rents have been increasing in “moderate but steady” steps – roughly +0.3% month-to-month over the past year globalpropertyguide.com.

Regional rent differences are significant. For example, Warsaw commands the highest rents – about PLN 4,900 (€1,050) per month on average for an apartment, followed by other large metros like Kraków, the Tri-City (Gdańsk–Gdynia–Sopot), and Wrocław globalpropertyguide.com. In contrast, smaller cities such as Kielce see average rents around PLN 2,000 (~€430) monthly globalpropertyguide.com. The table below shows rents in major markets as of March 2025:

Source: Otodom rental report, Mar 2025 globalpropertyguide.com.

We can see Warsaw’s rents are roughly double those of mid-sized cities like Łódź, paralleling the price gap in the sales market. Notably, rental yields on residential property have improved. Gross rental yields on apartments across Poland now average 6.13%, up from ~6.0% late last year globalpropertyguide.com. Among major cities, Bydgoszcz offers the highest yields at ~6.65%, reflecting its low purchase prices globalpropertyguide.com. Warsaw’s yields are also relatively high (~6.5% on average) thanks to strong rents, while Poznań showed the weakest yield (~5.36%) in the survey globalpropertyguide.com. Such yields – in the 5–6% range – are quite attractive by European standards and outpace current mortgage rates, which helps entice investor-landlords (despite uncertainty over potential tax changes on investment apartments).

Build-to-Rent (PRS) Expansion: The private rental sector (PRS) in Poland is undergoing a transformation. Traditionally dominated by small private landlords, the market is now seeing an influx of institutional investors building large-scale rental apartment blocks. As of 2024, Poland’s institutional PRS stock exceeded 21,000 apartments (in the biggest cities), with another ~25,000 units in the pipeline for the coming years globalpropertyguide.com. Nearly 40% of existing institutional rentals are in Warsaw globalpropertyguide.com, but other cities like Kraków and Wrocław are also hotbeds for Build-to-Rent projects. In fact, Kraków’s PRS market is now the third-largest in the country and growing rapidly, with ~3,400 units operating and almost 2,000 more under construction as of 2024 content.knightfrank.com content.knightfrank.com. High financing costs and surging purchase prices have pushed more people (including young professionals and relocating families) into renting, driving demand for these professionally-managed apartments content.knightfrank.com content.knightfrank.com. Occupancy in PRS is very high – e.g. Kraków’s rental projects saw vacancy fall to only 3.9% by end-2024 (from 6.5% a year before) despite significant new supply content.knightfrank.com. Many tenants in new PRS schemes are expatriates or Ukrainians, which highlights how migration is contributing to rental demand content.knightfrank.com. With more supply coming on stream, renters should gain options, but given Poland’s overall home shortage, the rental market is expected to remain tight in the near term. By 2025, about 12.9% of Polish households live in rented accommodation (still low vs Western Europe), and this share is rising as renting becomes more socially acceptable globalpropertyguide.com. The PRS trend, alongside government support for first-time buyers, is helping to gradually balance the market after years of extreme homebuyer demand.

Foreign Buyers: Interestingly, foreign buyers are becoming more active in Poland’s housing market, especially in major cities and suburbs. A recent survey of top developers found that in some new projects, buyers from abroad made up over 30% of clients in 2024 globalpropertyguide.com. The largest group by far are Ukrainians (many of whom have settled in Poland due to the war), followed by Belarusians and buyers from other Asian and CEE countries globalpropertyguide.com. Developers report a clear upward trend in interest from foreigners planning long-term life in Poland – often moving families and jobs here – who see Polish real estate as a stable investment globalpropertyguide.com. Poland imposes few restrictions on foreigners buying apartments (EU citizens can purchase freely; non-EU citizens generally can too, though they need permits for certain types of properties like farmland). This growing foreign demand provides an additional layer of support, particularly for new developments in the Warsaw area and Kraków. It also reflects confidence in Poland’s economy and living prospects.

Outlook: The consensus is that Poland’s housing market in 2025–2026 will stabilize rather than slump. Developers and banks (e.g. PKO BP) do not expect prices to fall significantly; instead, prices may plateau or rise in line with inflation globalpropertyguide.com globalpropertyguide.com. If, as forecast, the NBP delivers ~100 basis points of rate cuts in late 2025 globalpropertyguide.com, improved mortgage affordability should unleash some pent-up demand – albeit incrementally, since credit criteria remain cautious. Housing affordability is likely to improve slightly from the very poor levels of 2022–2023, thanks to slower price growth and easing financing costs. The government’s new “First Keys” program (targeting secondary-market homes) could also help more first-time buyers in 2025 globalpropertyguide.com, without excessively stimulating prices on new builds (which was a criticism of previous programs). Key risks to watch include: the timing and magnitude of rate cuts (a delay or smaller cuts could prolong the slump), any surprise policy interventions (e.g. stricter landlord taxes or rent control, though none are planned at the moment), and broader economic health. On the latter, Poland’s economy is still expanding, and unemployment is low, so a severe demand shock appears unlikely. Barring external shocks, housing demand should gradually firm up over the next 1–2 years, while supply is constrained (developers have held back new projects), suggesting that market equilibrium may be restored with modest price upticks rather than a bubble or a bust. As one housing report summarized: “[In 2025] sales will not return to 2020–2021 highs, but should remain stable, avoiding a major downturn” globalpropertyguide.com. The large housing deficit and growing population (buoyed by immigration) provide a solid underpinning for the residential sector’s medium-term prospects.

Office Real Estate: Quality Focus Amid Limited New Supply

Market Size and Recovery: Poland’s office sector is emerging from the pandemic-era challenges with resilience. The country’s total modern office stock now exceeds 13 million m² across nine key markets (Warsaw plus eight regional cities) polandoffices.com. Notably, the combined office inventory in major regional cities (6.8 million m²) has surpassed that of Warsaw (6.3 million m²) polandoffices.com, highlighting the growth of business hubs like Kraków, Wrocław, the Tri-City, Łódź, Poznań, Katowice, etc. Office leasing demand rebounded strongly in 2022–2024 after the pandemic dip. Annual take-up has consistently exceeded 1.4 million m² since 2017 (except the lockdown years) polandoffices.com. For 2024, total leasing volume is estimated around 1.45 million m² polandoffices.com. Corporates are actively renewing leases and optimizing space – renewals account for about half of transaction volume, as many companies consolidate or downsize their footprints in favor of higher-quality space polandoffices.com. Importantly, Q1 2025 saw an acceleration in demand: roughly 340,000 m² was leased nationwide in Q1, up 25% year-on-year europaproperty.com. Of that, Warsaw accounted for ~160,000 m² (mostly new deals), while regional cities collectively exceeded 180,000 m² (with a significant portion being renewals) europaproperty.com. This indicates that tenant activity is robust, particularly outside the capital, as businesses expand or relocate to modern premises in regional markets.

Vacancy Rates and Supply Crunch: Office vacancy in Poland peaked in 2021–2022 due to new completions coinciding with pandemic-era downsizing. By end of 2024, the overall vacancy rate stood at ~14% across the major markets polandoffices.com (approximately 1.84 million m² vacant, of which 1.17 million was in regional cities polandoffices.com). Warsaw’s vacancy was around 11–12% at that time, and regional city averages were higher (mid/high-teens). However, the tide is turning. Vacancy is expected to trend downward in 2025, primarily because new supply has dropped off sharply polandoffices.com. Development activity fell to multi-year lows in 2023–2024. In 2024, less than 200,000 m² of new offices were delivered in all key regional cities combined polandoffices.com. Warsaw’s pipeline also slowed to a trickle – only ~135,000 m² is slated for completion in 2025 (vs 300k+ in peak years) europaproperty.com europaproperty.com. In fact, Q1 2025 saw the lowest volume of new office completions in two decades – just one mid-sized project in Warsaw and one in Poznań were delivered during the quarter europaproperty.com.

For 2025, total new supply nationwide is forecast under 300,000 m² (an exceptionally low figure), and regional cities may see an “all-time low” in new deliveries polandoffices.com. Developers remain cautious: many have projects in planning but are delaying launches until they secure tenant pre-leases or until vacancies fall further polandoffices.com europaproperty.com. Additionally, some older office buildings are being withdrawn or repurposed (especially in Warsaw) because they are obsolete or inefficient europaproperty.com. This effectively removes some supply from the market, helping offset new additions. In Warsaw’s city centre, a lack of available development sites is another limiting factor – few new towers can rise without significant pre-commitments, and central land is scarce polandoffices.com. In secondary submarkets, construction will only restart when financing improves and demand guarantees (pre-lets) are in place polandoffices.com.

The result of these dynamics is a gradual easing of the glut. As of early 2025, Warsaw’s vacancy has dipped to just over 10% on average europaproperty.com, down from its peak. Moreover, there is a stark divergence within Warsaw: only ~7% vacancy in the prime city center vs 20%+ in some outer zones like Służewiec (“Mordor”) europaproperty.com. This illustrates a flight to quality and location – companies are giving up older periphery offices in favor of central, well-connected buildings. In the regions, vacancy remains higher on average (around 17–18% across major cities at end 2024) realestate.bnpparibas.pl europaproperty.com. Trends vary by city: Kraków and Katowice have started to see vacancy rates decline (thanks to strong absorption), whereas Wrocław and Poznań saw slight vacancy upticks recently europaproperty.com. As an example, Kraków (the second-largest office market, 1.8 million m²) had around 57,000 m² of take-up in Q1 2025 and only ~86,000 m² under construction europaproperty.com europaproperty.com – this tightening supply-demand is pushing its vacancy down. Overall, with limited new supply in 2025–26, vacancy is projected to continue decreasing both in Warsaw and most regional cities polandoffices.com, moving the office sector into a healthier balance by 2026.

Rents and Tenant Preferences: Office rents have remained broadly stable despite the pandemic and recent inflation in operating costs. Landlords have been cautious about raising headline rents, instead using incentives to adjust net effective rates. As of early 2025, prime asking rents in central Warsaw range from roughly €18 to €27 per m²/month europaproperty.com, depending on the building’s standard and exact location (landmark new towers achieve the upper end ~€25–27). Non-central Warsaw offices ask around €10 to €17/m² europaproperty.com. In major regional cities, Class A rents generally fall in the €9 to €19.5 per m² range europaproperty.com – with Kraków and Wrocław at the higher end (low-to-mid € teens on average, up to ~€18–19 for top new space) and smaller cities like Łódź or Szczecin at the lower end. These rent levels have seen slight upticks in 2024 in a few markets (landlords in Kraków, for example, inched prime rents up by ~€0.5 as vacancy tightened), but overall, no dramatic rent spikes occurred because competition for tenants remained high content.knightfrank.com. In 2025, as quality space gets absorbed, there could be some landlord-favorable shift in prime locations, leading to modest rent growth in the best buildings. Already, service charges (utilities, etc.) increased in 2022–23 due to energy costs, but by 2024 those stabilized and tenants have largely adjusted their total occupancy budgets.

Crucially, tenants are prioritizing quality over quantity. There is a “flight to quality” underway: companies prefer modern, sustainable offices with attractive locations and amenities to entice employees back to the workplace. “Tenants continue to favor new buildings, appreciating high standards and prime locations. Financial conditions, location, and transit access remain key factors,” observes a leading office adviser europaproperty.com. This is evidenced by the fact that in Warsaw, most space leased in Q1 2025 was in newer buildings in the central zone europaproperty.com. Older office stock that lacks green certifications, efficient ventilation, or flexible layouts is struggling to retain occupiers polandoffices.com. Some of these older buildings (especially those from the 1990s/2000s) face obsolescence unless renovated. We’re already seeing landlords upgrade assets to meet ESG standards – adding smart energy systems, improving air quality, and creating collaborative spaces polandoffices.com. Buildings that fail to meet modern ESG and wellness criteria risk longer vacancies and downward pressure on rents polandoffices.com. This has essentially split the market: a polarization between sought-after, high-spec offices (low vacancy, stable rents) and less popular, outmoded offices (high vacancy) cbre.pl. For instance, in Warsaw the gap is clear – shiny new skyscrapers in Wola are near full, whereas older offices in peripheral Mokotów have 20%+ vacancy and rent discounts.

Another trend is space optimization: many firms are leasing slightly smaller offices than pre-COVID, reflecting hybrid work patterns and efficiency drives. Newmark research notes the average lease size has shrunk in recent years polandoffices.com as tenants consolidate space or move to hot-desking. Despite this, overall demand is robust enough to keep absorption positive. Co-working and flex office operators are also expanding again, absorbing some vacancy by catering to companies seeking flexible terms.

Investment and Yields: Investor appetite for Polish offices revived in late 2024 as clarity on interest rates improved. Several large transactions closed, including landmark deals like the acquisition of Warsaw UNIT office tower for ~€280 million content.knightfrank.com. In total, offices accounted for ~33% of 2024 investment volume (roughly €1.6–1.7 billion) content.knightfrank.com content.knightfrank.com. International investors are attracted by Poland’s high yields relative to Western Europe. Prime office yields (for core assets in Warsaw) have moved out to about 6.0% as of Q4 2024 content.knightfrank.com – significantly higher than, say, Berlin or Paris offices (which trade at ~3–4%). Regional city prime offices may trade even higher, depending on lease length and covenant. These yields stabilized in late 2023 and may start compressing slightly again given improved sentiment content.knightfrank.com. Indeed, Poland offers a substantial risk premium and higher income returns than west European markets, which continues to attract global capital content.knightfrank.com. Local investors remain few (lack of REITs, etc.), but there is growing interest from German, US, and Asian funds seeking value in Polish office assets content.knightfrank.com. For 2025, the pipeline of deals is strong, including some portfolio sales and entry of new players.

Outlook: The Polish office market is in a cyclical upswing heading into 2025–2026. With nearly no oversupply on the horizon, the balance of power is slowly shifting back toward landlords in prime segments. Vacancies are expected to continue edging down (Warsaw could approach single-digit overall vacancy by 2026). Rent levels in top locations may rise modestly as supply tightens; we might see Warsaw prime rents touching €30 in a couple years if demand stays solid. However, the stratification will persist – secondary locations and older class B buildings will need to reposition (through renovations or conversions to other uses like residential) to remain competitive. We anticipate limited new construction until late 2025 or 2026 polandoffices.com, when likely lower interest rates and improved financing conditions could kick-start the next development cycle europaproperty.com. Some developers are already securing permits but waiting for those economic green lights. Also, if Poland’s economy stays on track, office employment growth (tech, business services, R&D centers, etc.) should continue, fueling steady absorption of space, especially in regional tech hubs. One emerging risk factor is the remote/hybrid work trend – while many companies have returned to office to a large degree, hybrid work is here to stay (with typical attendance rates 50–80% now being “normal”) and could cap future space requirements europaproperty.com. Nonetheless, Poland’s office sector has proven adaptable: tenants are focusing on quality and ESG, landlords are trimming supply and upgrading assets, and investors remain optimistic about long-term prospects. As Knight Frank noted, the market is undergoing a “correction phase” but with stable occupier demand and very limited new supply, the stage is set for a healthier equilibrium and potential rental growth in high-quality offices going forward cbre.pl.

Retail Real Estate: High Occupancy, Retail Park Boom & Evolving Consumer Trends

Strong Post-Pandemic Rebound: Poland’s retail real estate sector has largely shaken off the pandemic woes and is exhibiting renewed growth. Consumer spending in Poland has been rising in nominal terms, aided by higher wages and low unemployment, though high inflation did weigh on real retail sales in 2022–2023. By 2024, retail sales growth stabilized and foot traffic returned to shopping centers. In early 2025, retailers are cautiously optimistic: “Poland’s retail sector can look to the future with optimism. Despite global uncertainty and past high inflation, consumer purchasing power is rising, and e-commerce is now complementing brick-and-mortar rather than threatening it,” notes the head of retail at BNP Paribas Real Estate europaproperty.com europaproperty.com.

New Supply Surge in Retail Parks: One notable trend is a mini-boom in retail development, especially outside big cities. 2024 saw 545,000 m² of new retail space delivered across Poland europaproperty.com – the highest annual addition since 2015. Development has been particularly focused on retail parks and stand-alone retail warehouses, which meet shoppers’ demand for convenient, drive-up formats. In H1 2024 alone, Poland’s retail stock grew by ~300,000 m², and in Q1 2025 another 42,000 m² opened europaproperty.com. For full-year 2025, roughly 400,000 m² of new space is expected, nearly matching 2024’s volume europaproperty.com. This two-year wave is significant given that new retail construction had slowed markedly in the late 2010s. Projects include expansions of existing centers and many smaller schemes in underserved towns. For example, early 2025 saw the opening of M Park Mrągowo (15,000 m²), OTO Park Żagań (6,500 m²), and M Park Brzeziny (5,800 m²), all retail parks, as well as an extension of Aniołów Park in Częstochowa europaproperty.com. The development pipeline remains robust at ~450,000 m² under construction (including some reformatting of old hypermarkets) europaproperty.com. The largest project underway is the Designer Outlet Kraków (21,000 m², opened May 2025) europaproperty.com, and other notable ones are Przystanek Karkonosze and OTO Park in Siemianowice (each ~17–18k m²) europaproperty.com. Retail parks dominate these openings, reflecting a strategic shift: developers prefer open-air, lower-cost formats which have proven resilient (they remained accessible even during lockdowns, and cater to fast, convenient shopping).

High Occupancy and Recovery: Despite this influx of new space, Poland’s retail properties are largely highly occupied. The average vacancy rate in the 16 largest cities was only ~3.3% in mid-2024, down 0.3 percentage points year-on-year europaproperty.com. By late 2024 it hovered around 3% cushmanwakefield.com. Such low vacancy signals that demand is keeping up with supply. In fact, vacancies declined in 6 of the 8 biggest cities during 2024 europaproperty.com. Only Kraków and Wrocław saw slight increases (and Szczecin was flat) europaproperty.com, likely due to specific new projects temporarily adding space. Otherwise, retailers have been expanding – particularly grocery chains, value retailers, DIY stores, and select fashion brands – filling both new centers and backfilling older vacancies. Poland’s shopping malls in major cities have on average 97%+ occupancy, essentially full barring normal churn.

Footfall and sales data confirm the positive momentum. According to the Polish Council of Shopping Centres (PRCH), shopping center footfall at the start of 2025 was slightly above pre-year levels – January 2025 saw foot traffic +0.4% YoY and tenant sales turnover +2.6% YoY europaproperty.com. This suggests consumers returned in force after Christmas, and also did early-year shopping (perhaps ahead of winter holidays). The top-performing retail categories by sales growth were services (+6.6%), specialty retail (+6.2%), and health & beauty (+6.1%) europaproperty.com – indicating people are spending on personal care and discretionary services again. Shopping behavior appears to be normalizing, with brick-and-mortar and online retail finding a new equilibrium. E-commerce’s share of total retail sales in Poland has stabilized around 9% (as of March 2025) europaproperty.com. Rather than cannibalizing physical stores, online sales are now seen as complementary; many retailers operate omnichannel strategies, and consumers use both channels. In short, e-commerce is no longer viewed as an existential threat to malls, but just one part of the retail ecosystem europaproperty.com.

However, it’s not all smooth sailing: real (inflation-adjusted) retail sales have shown some weakness in 2023–2024. By early 2025, high inflation had eroded consumers’ purchasing power, causing slight year-on-year declines in volume. For instance, Statistics Poland data shows that March 2025 retail sales (in constant prices) were 0.3% lower than March 2024 (marking the second consecutive month of annual decline) europaproperty.com. Consumers remain a bit cautious, likely due to still-elevated prices and economic uncertainty. That said, on a monthly basis sales rose in March (up 14% vs Feb, reflecting seasonal factors) europaproperty.com. With inflation expected to fall further and wages rising, consumer confidence should improve later in 2025, which would translate to stronger retail growth.

Retail Formats and Challenges: A key structural challenge for Polish retail property is the ageing of its shopping center stock. Nearly 70% of retail space is over 10 years old europaproperty.com. Many first-generation malls from the 2000s are now in need of refreshment to meet modern shopper expectations. Landlords are actively embarking on renovations, upgrades, and adding new attractions. A prime example is the Nowa Sukcesja center in Łódź, which after struggling, is reinventing itself with a huge 30,000 m² entertainment zone called “Hopa Lupa” featuring trampoline parks, go-kart tracks, and other leisure draws europaproperty.com. This reflects a broader trend: retail landlords adding F&B (food & beverage), entertainment, and experiential elements to drive footfall and dwell time. We can expect more malls to follow this path – integrating cinemas, fitness, family entertainment, and dining to stay relevant as pure shopping moves online for some categories.

Another Poland-specific factor is the Sunday trading ban, which since 2018 limits most stores from opening on most Sundays. This law affected weekend footfall patterns and forced malls to adapt by increasing weekday events and offering services like eateries and cinemas (which are exempt). While not explicitly cited in reports, it’s an underlying factor in how Polish retail operates (and possibly one reason why retail parks – which often house supermarkets that can open on some Sundays – gained popularity).

Retailer sentiment: International brands generally view Poland favorably due to its large population and growing middle class. In 2024–25, several new entrants and expansions occurred, including in the luxury segment in Warsaw and value brands across regional cities. Consumer confidence hit lows in 2022 with war next door and high inflation, but has been recovering. There is still some caution (as evidenced by those slight dips in volume), but overall consumption is forecast to grow in 2025 in real terms as inflation abates. This bodes well for retail landlords – higher sales translate to healthier tenants and potential for rent indexation.

Investment and Yields: The retail investment market saw a big comeback in 2024, accounting for about 32% of Poland’s commercial property investment volume content.knightfrank.com. Several headline deals took place: notably, two of Poland’s largest malls – Silesia City Center in Katowice and Magnolia Park in Wrocław – were acquired by South African investor NEPI Rockcastle for €405 million and €373 million respectively content.knightfrank.com. There was also a portfolio of six mid-sized retail parks sold for €285 million content.knightfrank.com. These transactions show renewed confidence in Polish retail assets, particularly dominant shopping centers and convenience/retail park portfolios. Prime shopping centre yields have moved out to around 6.25% by end-2024 content.knightfrank.com – significantly higher than pre-pandemic (when prime yields were ~5.0%). This outward shift reflects both global repricing (due to higher interest rates) and some perceived higher risk in retail. However, investors are drawn to the fact that Poland’s retail yields are higher than in Western Europe, offering potential upside as the market stabilizes content.knightfrank.com. Retail parks, with their resilient income, are particularly sought after; their yields are in a similar ballpark or slightly above malls (depending on lease length and tenant mix).

One constraint to local investment in retail (and other sectors) has been the lack of REITs. As mentioned, over 90% of commercial real estate investment in Poland comes from foreign capital europaproperty.com, partly because domestic institutions and individuals have no REIT structure to invest through. The government has long discussed introducing REIT legislation, and if enacted, it could funnel Polish savings into properties like shopping centers, potentially boosting domestic ownership. As of 2025, though, no REITs exist – a “continued absence” that industry experts note as a missing piece europaproperty.com.

Outlook: The outlook for Polish retail real estate over the next 3–5 years is cautiously positive. The sector’s fundamentals – low vacancy, growing consumer spending power, and limited new mall supply in big cities – indicate stability. We expect high occupancy to persist, especially in well-performing shopping centers and grocery-anchored retail parks. Rents in prime centers are likely to remain stable or rise slightly in line with indexed inflation, given strong tenant demand for top locations. Secondary assets (older centers in saturated markets) will face pressure to reinvent or could see increasing vacancy if they fail to modernize. We anticipate continued growth of retail park developments in smaller cities, as this format aligns with current consumer preferences (convenience, open-air, local shopping). Retailers will continue expanding stores – particularly discount supermarkets, DIY stores, and international fashion chains targeting Poland’s still under-retailed medium towns.

Consumer spending is a swing factor: if inflation falls to ~4% in 2025 and ~3% in 2026 (as forecast) reuters.com, real wages will rise and support more retail sales volume. Additionally, Poland’s population has grown due to immigration, adding new consumers. Thus, demand for retail space should grow modestly. On the other hand, e-commerce will steadily increase its share (perhaps moving from ~9% to low teens % of sales by 2028), which could cap the need for some types of physical retail space (particularly electronics and books, which are already largely online). But categories like groceries, dining, leisure, and services will keep brick-and-mortar important.

Key challenges and risks for retail include: adapting older centers, maintaining footfall in the face of online convenience, and any potential economic slowdown that hits consumer confidence. Additionally, cost pressures (utilities, wages) can strain retailer profitability, impacting their ability to pay rent – though many have adapted with omnichannel models. Overall, Poland’s retail real estate is expected to remain healthy, with the country’s sustained economic growth translating into higher retail turnover. The focus for the industry will be on quality of experience – adding entertainment and hospitality elements to malls – and on strategic development – building the right formats (parks, outlets, mixed-use high street projects) to match evolving consumer habits. With these adjustments, the retail segment should enjoy stable yields and potentially further yield compression if Poland successfully launches REITs or if more domestic investors join the fray.

Industrial & Logistics: High Demand Meets Slower Supply – A Balanced Outlook

Record Expansion, Now Easing: Poland’s industrial and logistics real estate has been a star performer, growing at an extraordinary pace in recent years. By Q4 2024, Poland’s total modern warehouse and industrial stock reached ~34.5 million m² megaproject.com, marking a ~9% increase year-on-year property-forum.eu. (For context, that’s roughly double the stock from just five years prior – an indication of the boom driven by e-commerce and nearshoring.) In 2024 alone, developers delivered around 4+ million m² of new space across 14 regions megaproject.com. This torrid pace made Poland one of Europe’s top logistics development markets – as of mid-2024, Poland had the second largest net take-up in Europe (only behind one other market) marketoutlook.cbrepoland.pl, underscoring its status as a continental warehouse hub.

Demand Drivers: Several factors are behind this strength. Poland’s strategic location in Central Europe, relatively low labor costs, and improving infrastructure (roads, highways, rail) attract manufacturers and distribution centers serving the EU. The rise of e-commerce (Amazon, Zalando and others have large fulfillment centers in Poland) and the growth of 3PL (third-party logistics) operations have been huge demand drivers. Additionally, nearshoring trends – Western firms moving production closer to home – have benefited Poland, especially as global supply chain tensions (e.g. US-China trade issues) prompt companies to diversify locations polandinsight.com. Indeed, Polish agencies report a growing number of inquiries from international firms (including Chinese companies) for new logistics spaces in Poland as they rework supply chains polandinsight.com.

Robust Leasing, Slight Uptick in Vacancy: Demand for industrial space has been robust. Leasing activity in 2024 hit ~5.8 million m², up ~4% from 2023 axiimmo.com, indicating continued expansion by occupiers. Notably, about 48% of 2024 take-up were lease renewals polandinsight.com – meaning existing tenants are renewing in large numbers, a sign of confidence in the location, although it also means a smaller portion was pure new expansions. Even so, new deals and expansions accounted for ~3 million m², which is very healthy. The vacancy rate, which was extremely low (around 5% or below) during 2019–2021, has risen slightly as supply raced ahead. At end of 2024, vacancy stood around 7.5% nationally polandwarehouses.com (approximately 2.6–3 million m² available). By mid-2025, vacancy ticked up further to 8.5% polandinsight.com. This increase is largely because new supply briefly outpaced net absorption – the market is absorbing space fast, but developers delivered so much in 2022–Q1 2024 that vacancies built up in some locations polandinsight.com. For example, regions like Lower Silesia (Wrocław) saw a higher vacancy as multiple large parks opened simultaneously europaproperty.com.

However, an 8% vacancy is still indicative of a balanced market – just enough availability to allow tenants choice, but not a glut. Industry experts actually view the rise in vacancy as a healthy normalization after the ultra-tight market of previous years: “The rise in vacancies is a natural outcome of the previous investment boom. The market is moving back toward equilibrium,” explains a Knight Frank analyst polandinsight.com polandinsight.com. Higher vacancy has shifted a bit more negotiating power to tenants for the first time in years (tenants can secure slightly better terms or incentives in some areas) cbre.pl cbre.pl. Developers have noticed and have pulled back on speculative construction, which in turn will prevent vacancy from spiking too much. Indeed, new project starts in late 2024 were fewer, and the pipeline under construction has shrunk significantly compared to 2021–22 peaks. The market is thus heading for a soft landing: demand remains strong and broad-based (3PL, retail, light manufacturing, data centers, etc.), while supply growth is cooling, allowing the existing vacant space to be absorbed over the coming quarters.

Rent Stability and “Urban” Logistics Premium: Despite cost inflation (materials, labor) and higher financing costs, rents for warehouse space have remained quite stable. Poland’s industrial rents are among the most affordable in the EU, one reason it attracts tenants. As of mid-2025, typical big-box logistics rents range from about €3.80 to €5.00 per m²/month polandinsight.com for standard spaces in main hubs (with the lower end in central Poland and Upper Silesia, and higher end around Warsaw or in smaller urban markets). Meanwhile, “urban” last-mile warehouses (smaller units near city limits or within urban areas) command higher rents, roughly €5.00 to €7.50 per m²/month polandinsight.com, because of their location convenience. These rent levels have not changed dramatically in the past year – they’ve been relatively flat, which indicates that even with vacancy creeping up, landlords have not had to cut headline rents. Instead, they might give more incentives on long leases. The stable rents point to a mature sector where both landlords and tenants seek long-term partnerships rather than engage in price wars polandinsight.com.

It’s worth noting that newer leases often include indexation to inflation (typically annual CPI adjustments), so many landlords saw rental income rise in 2022–23 due to high inflation. Going forward, with inflation moderating, rent indexation will be lower, so any growth in rental income will depend on occupancy gains or capturing higher rents on new leases in prime locations.

Sustainability (“Green Warehouses”): A significant trend in logistics is the push for sustainable, energy-efficient warehouses. Many new developments in Poland are built to BREEAM or LEED green standards – featuring solar panels, LED lighting, rainwater harvesting, and even on-site energy storage. There is strong occupier and investor demand for “green” certifications, as companies aim to reduce carbon footprints. The Poland Insight article suggests a “surge in green warehouses” (as per its title) – indeed, this is a selling point now. We’re seeing solar PV installations on large warehouse rooftops become common, and some facilities even integrating with electric truck infrastructure. This trend will make Poland’s already modern stock even more future-proof, but also requires upfront developer investment (which they recoup through slightly higher rents or occupancy preference).

Geographical spread: The core logistics regions remain Warsaw (Central Poland), Upper Silesia (Katowice region), Lower Silesia (Wrocław), Poznań, and increasingly Central Poland (Łódź region) and Western Poland (Szczecin, targeting German market). These regions have the bulk of the 35 million m² stock. But growth is also spreading to Eastern Poland and smaller cities as the highway network extends (e.g., Rzeszów, Lublin catching up). For example, foreign investors have started looking at developing near the Ukrainian border (Rzeszów) anticipating future reconstruction demand in Ukraine and current NATO military logistics needs there.

Investment Market: Logistics real estate has been the darling of investors, and Poland is no exception. In 2024, industrial assets comprised ~25% of investment volume content.knightfrank.com. While less spectacular than 2021’s frenzy, deals are still happening. Yields underwent a notable correction in 2022–23, moving outward from historic lows (~4% or below) to more attractive levels around 6.25% for prime logistics by end-2024 content.knightfrank.com. This correction, combined with the sector’s strong fundamentals, has renewed interest from both existing and new investors. Many global funds that couldn’t justify buying at 4% yields are now finding Polish warehouse cap rates compelling at 6%+ content.knightfrank.com. Additionally, Poland offers a high yield spread over Western European logistics (where prime yields are ~3.75–5%), making it a top target for core-plus and value-add strategies content.knightfrank.com.

Notably, a sale-leaseback trend is picking up, wherein owner-occupiers sell their industrial facilities to investors and lease them back. Poland’s “early 2025 saw record sale-leaseback activity” according to market reports polandinsight.com. This indicates Polish corporates are monetizing real estate given high values and investors are eager to buy long-leased assets. Another point: domestic Polish investors have increased their share in industrial deals recently (Polish capital made up ~9% of 2024 overall CRE volume content.knightfrank.com, and some of that is in industrial via private funds and developers). Still, foreign investors (from Europe, US, Middle East, South Africa, Asia) dominate large transactions. With plenty of developer platforms in Poland (Panattoni, GLP, Segro, etc.), there’s a pipeline of new grade-A product for investors to acquire.

Outlook: The mid-term outlook for Poland’s industrial & logistics property is strongly positive, albeit shifting from breakneck expansion to sustainable growth. Demand is expected to remain high: Poland’s economy (especially manufacturing, retail, and e-commerce logistics) should grow steadily, generating continuous need for warehousing. The geopolitical climate, while tense, actually favors Poland as companies reconfigure supply chains to be closer to European end-markets (Poland’s stable EU membership and large labor pool give it an edge over some lower-cost countries). Supply will moderate – developers are more cautious now, banks a bit stricter on financing speculative builds. But this is a healthy adjustment; it’s likely that 2025 new supply will be lower than 2024’s, helping vacancy peak and then potentially decline again by 2026. Already by H2 2025, we might see vacancy plateau around 8–9% and then improve as absorption continues.

Rents could see slight upward pressure again in prime locations once the current vacant stock is leased. Many logistics tenants have urgent needs (3PLs signing contracts, retailers needing distribution centers) and will pay a premium for proximate, ready space – especially around Warsaw and other major cities. In outlying regions with more availability, rents will stay competitive.

A big unknown is the Ukraine war endgame: a reconstruction boom in Ukraine could significantly boost demand for logistics space in eastern Poland (as a staging ground), while also potentially drawing some business into Ukraine over the longer term. For now, Poland is benefiting as a safe haven for logistics and manufacturing activity that might have gone to Ukraine or Russia before.

In terms of risks: a global or European recession would temper demand (though so far manufacturing in Poland is diversified and partly cushioned by nearshoring trends). Also, if interest rates remain higher for longer, that could limit investor-driven development and keep financing costs up, but it also means existing assets are more valuable for their yield. Construction cost inflation was a challenge, but has eased a bit since 2022 – still, any resurgence could squeeze developer margins.

Summing up, Poland’s industrial real estate sector is maturing. It’s moved from undersupply to a more balanced state, with modern space readily available. Stable rents, high occupancy (even at 8% vacancy, many submarkets are effectively full for large units), and continued demand drivers paint a favorable picture. We expect Poland will remain a top 3 European logistics location, and by 2028 the total stock could approach Forty to fifty million m² as development continues, albeit at a controlled pace. The focus going forward will include more spec-built big-boxes on shorter development cycles (to quickly meet tenant needs) and value-add redevelopment of older warehouses (adding automation, ESG features). Given these trends and Poland’s competitive advantages, the industrial segment should continue delivering solid returns for investors and supporting the broader economy’s growth.

Land Market: Cautious Rebound and Planning Reforms

Investment Land Market – From Boom to Slowdown: The market for development land in Poland experienced a roller coaster in recent years. A surge of activity in 2021–2022 (when developers rushed to secure plots amid cheap credit and booming housing sales) was followed by a sharp cooling in 2023 as conditions changed polandinsight.com. By 2024, many investors and developers adopted a “wait and see” stance due to the absence of government housing supports, skyrocketing financing costs, and general uncertainty polandinsight.com. Banks also tightened lending for land purchases, applying very selective criteria polandinsight.com. This led to a dip in transactions – 2023 had relatively few big land deals as players paused expansion plans.

Entering 2025, sentiment in the land market is shifting from stagnation toward cautious reactivation. The first half of 2025 has seen more contracts being finalized than the previous year, but buyers are extremely thorough with due diligence and feasibility analysis before committing polandinsight.com. In other words, investors are returning but focusing only on opportunities with clear, “verified” demand and solid fundamentals polandinsight.com. Land that can facilitate in-demand projects – residential development (especially mid-range housing), PRS rental apartment projects, urban infill warehouses/logistics, and mixed-use schemes in growing secondary cities – is seeing interest polandinsight.com. On the other hand, land without a clear development path or in areas with planning complications is still largely avoided.

Transaction volumes are expected to improve in 2025 compared to 2024, especially in the second half of 2025 polandinsight.com. Market experts describe 2025 as a year of “rebuilding potential” rather than headline-grabbing deals polandinsight.com. It likely won’t reach the frenetic levels of the 2021 land grab, but activity will be healthier. Notably, land prices have not crashed; owners of well-located plots have generally held their prices, choosing to wait rather than sell at a deep discount. There may be some softening in peripheral locations, but prime development land (in cities) still commands a premium. Poland also still has relatively competitive land costs in a CEE context, one factor attracting foreign developers to consider projects here marketoutlook.cbrepoland.pl.

Investor Profile and Foreign Participation: The mix of buyers in the land market has evolved. In 2025, local Polish developers and investors (especially those not tied to public markets) are quite active, leveraging their on-ground knowledge and faster decision-making polandinsight.com. A trend of “neighborly transactions” is noted – investors from nearby countries (Czech Republic, Germany, the Baltics) are participating in Polish land deals polandinsight.com. These regional players often have a good grasp of the market and sometimes seek joint ventures with Polish firms. Major Western European institutional investors have been more cautious, awaiting clearer economic signals before re-entering aggressively polandinsight.com.

At the same time, new foreign entrants are emerging: some Turkish and Mediterranean investors have begun acquiring smaller land plots, willing to pay competitively for safe projects as a way to enter the market polandinsight.com. Also, as referenced earlier, Chinese firms have shown interest in logistics land due to global trade shifts polandinsight.com. This aligns with Poland’s stable economy and strategic location making it a favored spot for manufacturing/logistics bases relocating from Asia polandinsight.com polandinsight.com. Meanwhile, South African and other global funds that invest in developed projects have not been typically buying raw land directly – instead, they often partner or wait to buy completed assets. But some are financing developers via forward-funding deals on land as an indirect way to secure pipeline.

One positive development: Polish private capital is increasingly pooling to invest in land. For example, advisory firm Walter Herz raised over PLN 50 million from private individuals to invest in land acquisitions in Warsaw, Poznań, and Tricity polandinsight.com. This indicates growing sophistication and interest from local high-net-worth investors in land banking, stepping in while big institutions are less active.

Land Use and Demand Pockets: There are a few categories of land particularly in demand:

• Residential construction land: Given the housing deficit and expected recovery in home sales, well-located plots for new housing (especially in suburbs of major cities or in fast-growing satellite towns) are sought after polandinsight.com. Developers are mindful of not overpaying, but they do want to replenish land banks to be ready when the market fully picks up.
• PRS (Build-to-Rent) project land: Institutional rental housing developers (both Polish and foreign-backed) are hunting for plots in big cities where they can build apartment complexes for rent polandinsight.com. This includes converting some office-zoned land or mixed-use land into residential/PRS projects, as that segment is booming.
• Urban logistics land: As e-commerce and last-mile delivery expands, smaller warehouses near city centers are in demand. Investors are eyeing land on city outskirts or industrial zones within metros for “urban logistics” facilities polandinsight.com. Such land is often limited, so competition can be stiff.
• Mixed-use and office redevelopment sites: In certain city centers, there are older industrial or commercial sites that can be redeveloped into mixed-use projects (combining offices, retail, and apartments). Some investors target these, betting on cities like Kraków, Wrocław, or Łódź modernizing their cores.
• Agricultural land with conversion potential: Interestingly, farmland in Poland has seen increased interest from investors who anticipate rezoning to development use. Regions with strong urbanization pressure (surrounding Warsaw, Kraków, Wrocław, etc.) have farmland that could be reclassified to residential or industrial. Investors willing to navigate the process are buying such plots as a long-term play polandinsight.com. Polish farmland values have risen in recent years, especially after 2016 when EU citizens were allowed to buy land freely (post-EU accession transitional period). Even so, farmland is still cheaper than in Western Europe, so there’s upside if it can be converted.

Major Challenge – Planning and Regulations: Perhaps the biggest hurdle in Poland’s land market is the planning system. Only about 30–40% of Poland’s territory is covered by binding local spatial development plans (MPZP) polandinsight.com. The rest of the land requires case-by-case zoning decisions (WZ – development conditions decisions), which can be slow, unpredictable, and discretionary polandinsight.com. Investors often face long waits for zoning approvals, and sometimes authorities simply don’t issue a decision, stalling projects polandinsight.com. The government has been working on an overhaul – introducing “General Plans” for municipalities – but that has been delayed and, so far, has added confusion with shifting deadlines polandinsight.com. The result is a degree of legislative chaos in spatial planning polandinsight.com, which is cited as a major inhibitor for transparent and efficient land development.

Recognizing this, policymakers are proposing reforms. One idea is deregulation to streamline processes – e.g., implementing simple, digital procedures for planning permissions polandinsight.com. An example: eliminating the requirement for full environmental impact decisions for certain low-impact projects (like small service buildings or warehouses), which currently add many months to permitting even when the environmental effect is minimal polandinsight.com. The suggestion is to create a list of “low-impact” investments that could skip or simplify the environmental permit stage polandinsight.com. Also, digitizing land and mortgage registers nationwide is on the agenda, which would speed up due diligence and transactions polandinsight.com.

Another specific regulatory issue is farmland conversion. Poland classifies agricultural land by quality classes, and converting high-quality farmland for development often requires a ministerial approval, which is tough to get. There’s talk of setting clear criteria to allow automatic exclusion of lower-grade (class IV or V) farmlands from agricultural production without needing ministry consent polandinsight.com. This would free up more land for investment around cities, as a lot of suburban land is formally “agricultural” but not very productive.

In summary, planning reform is crucial: investors consistently say they need more predictable and faster zoning to truly ramp up land deals polandinsight.com. The government is moving in that direction, but progress has been slow. Until improvements take effect, land deals will focus on plots that either already have zoning or have a very good chance of obtaining it.

Outlook: The investment land market in Poland for 2025–2027 looks to be on an upswing, but in a measured way. Assuming interest rates gradually fall, financing land purchases and development will become easier, which should bring back more buyers. Land values in prime areas (e.g. central Warsaw plots, key residential zones) are likely to hold firm or increase, given scarcity. In contrast, secondary locations might see stagnant prices until demand clearly returns. We expect competition for high-quality land to intensify in late 2025 and 2026 as developers prepare for the next construction cycle, which could put upward pressure on prices in top locations.

Foreign investor interest in Polish land should also rise once macro conditions stabilize. Some large institutional players who paused acquisitions in 2023–24 may re-enter, especially if they see Poland’s economy continuing to grow ~3% annually and the real estate cycle turning positive. The inflow of EU funds for infrastructure and other investments (Poland is a big beneficiary of EU budgets) will also make more areas attractive for development (better roads can suddenly make a logistics site viable, etc.).

Key risks and variables: The primary risk remains the regulatory environment – if planning reforms stall or if there’s political instability affecting real estate laws, it could spook investors. Also, if the government were to impose heavy constraints on foreign ownership of land (unlikely, as Poland already eased most restrictions), that could affect foreign participation. Another factor is construction costs – a surge in building costs can reduce what developers can afford to pay for land (since total project feasibility is affected). At the moment, construction costs have stabilized, which is positive for land values.

In conclusion, Poland’s land market in 2025 is characterized by discernment and selectivity. The era of speculative buying of any plot is over; now it’s about carefully chosen sites with clear potential. The year is shaping up as one of “rebuilding potential”, as one analysis put it polandinsight.com, setting the stage for more vibrant activity in the coming years. With better planning policies and economic tailwinds, Poland could unlock a lot of currently idle land for development, which would help address needs like the housing shortfall and expanding logistics network. Investors view land as a safe haven for capital in the long run (a tangible asset in a growing country) polandinsight.com, and many are positioning themselves now to reap the benefits when the development cycle kicks into higher gear.

Foreign Investors and Regulatory Factors

Foreign capital plays a dominant role across Poland’s real estate sectors, bringing both opportunities and considerations. On the commercial investment side, international funds have been the driving force behind large transactions. As noted, in 2024 foreign investors accounted for roughly 90%+ of the €5+ billion CRE investment volume europaproperty.com. These include global private equity firms, insurance funds, pension funds, and specialized real estate investors from Europe, North America, Asia, and South Africa. The attraction is clear: Poland offers scale (a big economy of 38 million people), growth (higher GDP and consumer growth rates than Western Europe), and significantly higher yields. Core office, retail, and logistics assets in Poland yield between 6–7% (as detailed earlier), versus 3–4% in many Western markets content.knightfrank.com. This yield spread compensates for perceived emerging-market risk and currency risk (though Poland’s currency, the złoty, is relatively stable and the country is EU-integrated).

By country of origin, recent years saw German, American, British, and South African investors among the top buyers content.knightfrank.com. South African REITs (like NEPI Rockcastle and Redefine) have been particularly active in retail and offices, respectively. U.S. and Canadian investors made a comeback in 2024 as well content.knightfrank.com. The capital origin breakdown for 2024 shows diverse sources: e.g., South African (19% of volume), USA (11%), UK (13%), Western Europe (9% excluding Germany/UK), CEE neighbors (18%), and Polish domestic ~9% content.knightfrank.com. This diversity indicates Poland is on the radar of investors worldwide. Furthermore, new entrants continue to appear – for instance, in 2024 the UK’s Sona Asset Management entered via a large office portfolio deal content.knightfrank.com, and Middle Eastern capital is rumored to be scouting logistics portfolios.

Why local investors are few? The relatively low share of domestic capital (only ~9% in 2024 content.knightfrank.com) is mainly due to structural reasons. Poland lacks a developed REIT or similar investment trust system, so local institutional money (pension funds, etc.) has not traditionally flowed into property. There are only a handful of large Polish real estate investors (like state-backed PFR or some insurance companies) with capacity for big deals. This is changing slowly, with more Polish high-net-worth and private equity looking at real estate, but for now foreign capital fills the gap. As mentioned, the introduction of REIT legislation – which has been in the pipeline for years – could be a game-changer, allowing smaller domestic investors to indirectly invest in property and thus increasing local participation europaproperty.com. Industry experts frequently call for this, citing the successful adoption of REITs in neighboring Czechia, for example europaproperty.com.

Regulatory environment for foreign investors: In general, Poland is quite open to foreign ownership of real estate. Since joining the EU, EU citizens and companies can purchase Polish real estate (including land) without restrictions (a few exceptions like agricultural land during a transition period which ended in 2016). Non-EU foreigners can also buy, though certain categories of property (especially agricultural and forest land) require a permit from the Ministry of Interior. This permit process is a formality in many cases but aims to prevent strategic land grab. However, for urban real estate (offices, apartments, warehouses), there are usually no obstacles for reputable international buyers. Poland has clear title registration (the Land and Mortgage Register system) and legal protections for owners, which foreign investors appreciate.

One regulatory concern can be taxation: Poland’s taxes on real estate include a 1% transfer tax (for asset deals) and ongoing property taxes (which are comparatively low flat rates per m²). There’s no annual wealth tax on property, unlike some countries. However, the government has floated ideas such as an additional tax on landlords with multiple residential units (to curb speculation) globalpropertyguide.com. While nothing concrete is implemented yet as of 2025, investors keep an eye on such proposals. Another development is the push for ESG compliance – EU regulations (like energy efficiency directives) mean that buildings failing to meet standards might lose value. Foreign investors, often being ESG-conscious, favor assets with green certificates. This indirectly regulates what types of properties attract investment; those with poor efficiency may need upgrades or they’ll be bypassed.

Foreigners in residential market: Aside from institutional players, Poland has also seen individual foreign buyers in segments like luxury residential and second homes (e.g. some Ukrainians, as mentioned earlier, and also some expats buying in Kraków or coastal areas). The government at one point considered restrictions (like some countries have limits on foreign buying to cool markets), but Poland has not enacted any such measures, given foreigners still comprise a relatively small fraction of total housing transactions (the spike to 30% in select projects is notable but those are specific cases, often near international organizations or favored by migrating groups) globalpropertyguide.com.

Outbound investment: It’s also worth noting Polish investors themselves are increasingly active abroad (e.g., buying warehouses in Western Europe through funds), though that’s outside this report’s scope. If REITs are introduced, it could also facilitate Polish capital going into foreign real estate.

In summary, foreign investor participation is integral to Poland’s real estate market, bringing in expertise and liquidity. The regulatory environment is generally favorable, with strong legal rights and few ownership barriers. The main improvements desired by the industry – such as the planning process simplification polandinsight.com and introduction of REITs – would benefit all, foreign and domestic alike, by increasing transparency and capital flow. Barring any unexpected protectionist turn (which is not anticipated under the current pro-business government), Poland should remain an attractive, open market for global real estate investment.

3–5 Year Forecast and Outlook (2025–2030)

Looking ahead, Poland’s real estate market is poised for steady, sustainable growth over the next several years, supported by solid economic fundamentals and the sector-specific trends detailed above. Here we summarize the outlook by key factors and property type:

Macroeconomic & Financial Outlook: Economists project Poland’s GDP growth to average around 3–4% annually in 2025–2027, outpacing the broader EU cbre.pl. Private consumption will continue to drive growth, aided by rising wages and the absorption of substantial EU funds into the economy. Inflation, which soared to double digits in 2022, is expected to normalize to ~4% in 2025 and ~3% by 2026 reuters.com – near the upper end of NBP’s target range. Indeed, an NBP survey sees 2025 average inflation at 4.1%, falling to 3.2% in 2026 reuters.com. This cooling inflation should allow the NBP to cut interest rates further. Forecasts suggest the reference rate could be trimmed by an additional ~75–125 bps by end-2025 (bringing it to ~4.0–4.5%), and possibly down to ~3.5–4.0% by end-2026 focus-economics.com think.ing.com, assuming no new inflation shocks. Lower interest rates will be a boon to real estate: reducing mortgage costs, improving commercial project financing, and likely compressing property yields (i.e., raising capital values) somewhat. Unemployment is projected to remain very low (3–5%), and Poland may continue to attract a workforce from neighboring countries, expanding its labor pool. One risk on the horizon is the global economy – if major EU trading partners stagnate, Poland’s export-driven industries could slow, but current consensus sees modest growth in the EU which should support Poland’s outlook.

Residential Forecast: We expect residential property prices in Poland to rise modestly over the next 3–5 years, roughly tracking income growth and inflation. Annual price increases in the low-to-mid single digits (e.g. 3–6% per year) are likely, rather than the double-digit jumps of the recent past. This means in real (inflation-adjusted) terms, home prices will be broadly stable or see slight real appreciation. Key drivers: the huge housing deficit will persist – even with record construction in recent years, Poland still has one of the lowest housing unit ratios per 1,000 citizens in Europe cbre.pl. Demographics are actually turning supportive thanks to immigration (the population may be growing again after years of stagnation, due in part to Ukrainians settling). Additionally, by 2026–2027, the current downturn in housing construction starts (many projects were paused in 2023–24) could lead to lower new supply coming to market, ironically causing a tighter supply-demand balance and preventing any price decline.

Mortgage availability should improve with rate cuts – expect a gradual loosening of credit after the shock of 2022’s rate hikes. Government programs (like “First Keys”) will help certain buyer groups (first-time buyers of older flats) starting presumably in 2025, giving the market a mild stimulus without overheating it. Rental demand will remain strong, so rental rates are likely to keep climbing slowly (perhaps ~2–5% per year) as urbanization and lifestyle changes increase the renter cohort. Poland’s PRS sector will significantly expand – from ~21k units now to perhaps >50k by 2030 – which will professionalize rentals and add supply, but given current shortages, it won’t cause rent drops; rather it will meet new demand.

One caveat: if interest rates were cut too quickly or a overly generous subsidy reintroduced, there could be another burst of price acceleration. But policymakers seem intent on avoiding that volatility globalpropertyguide.com. The base case is a stabilized growth trajectory: as one developer forecast, “we do not expect prices to return to early-2023 lows; instead, moderate growth aligning near inflation” globalpropertyguide.com. By 2028, Poland’s housing stock will likely see new innovations – more energy-efficient “green” homes (as EU climate rules mandate upgrades), more prefab construction to reduce costs, and possibly the first signs of institutional homebuilders (build-to-rent companies constructing whole single-family neighborhoods for rent, a model starting to appear in Europe). Overall, the residential sector should remain a pillar of the market, with no major crash in sight, underpinned by demographic need and improved affordability.

Office Forecast: The next few years in offices will be about quality over quantity. New supply will remain limited until at least 2026 polandoffices.com, which will gradually tighten vacancy in prime segments. By 2025–2027, we anticipate prime CBD office vacancy in Warsaw could fall to ~5% or less, effectively full occupancy, pushing some tenants to non-central locations – though non-central vacancy will still be elevated until obsolete stock is removed. In regional cities, vacancy will diverge: leading markets like Kraków and Tricity might drop to ~10% or below if demand stays strong, while weaker markets could hold in the teens.

Developers are likely to restart more projects by 2026, especially in Warsaw where there’s a virtual halt now. A new wave of office towers could launch in late 2025 to meet expected demand by 2027–2028, particularly if financing costs decrease. Some redevelopment projects will also materialize: older offices converted to residential or hotels, etc., which will reduce office inventory in secondary locations but also address other needs (for example, some aging Warsaw offices in Jerozolimskie corridor might become apartments or student housing).

Office rents in prime locations could rise by perhaps 5–15% cumulatively over the next 3 years, especially for top floors in modern green buildings – these are in limited supply and high demand. Occupiers have shown willingness to pay a premium for quality that helps them with employee satisfaction and ESG goals. Meanwhile, older building rents may stagnate or even decline unless those buildings are upgraded. So the rent gap between Class A+ vs Class B will widen. Incentives (like rent-free periods) in prime buildings will shorten as landlords gain leverage, improving net effective rents.

Trends like hybrid work will continue to influence how offices are used – we expect companies to allocate more space per desk (for collaboration areas etc.) and accept lower average attendance, but still maintain office footprints for culture and client needs. So while they might not need as many extra square meters as before per employee, growth in business sectors (IT, BPO, R&D centers) in Poland should still lead to net positive absorption each year. Poland’s skilled talent and cost advantage will keep drawing multinationals to set up offices (especially in Kraków, Wrocław, etc., which are now established service hubs).

Office investment should pick up momentum as well. If interest rates decline as forecast, prime office yields – currently ~6.0% content.knightfrank.com – could compress back into the low-5% range by 2026, boosting capital values. We also foresee new players (possibly Asian sovereign wealth funds or Middle Eastern investors) entering Polish offices attracted by the value proposition. A risk factor is the global office sentiment – globally, offices are under scrutiny due to remote work. But Poland’s situation is more favorable since its office stock is newer and more concentrated in high-demand tech and service sectors. As long as landlords continue to adapt (flex space offerings, amenities, ESG), Polish offices should remain a compelling story.

Retail Forecast: The retail sector in Poland is relatively mature, so no massive expansion of shopping centers is expected. Instead, the next years will focus on optimizing and refreshing existing stock. Many malls will undergo renovations, and we expect some older or underperforming centers to repurpose (partially converting to offices, apartments, or logistics pickup points). Retail parks and convenience centers will continue to grow, especially in smaller cities – there’s still room for new grocery-anchored projects in towns that lack modern retail.

Consumer spending, as noted, should strengthen once inflation settles. By 2025–2026, if inflation is ~3–4% and wage growth remains say 7–10%, Poles will enjoy real income growth, which translates to more retail consumption. This could drive sales densities in malls higher, allowing some rental uplift in prime centers via turnover rents or lease renewals. However, e-commerce will also likely rise to ~15% of retail sales by 2030, which means brick-and-mortar will need to keep evolving to stay relevant. Expect more integration of online-offline (click-and-collect facilities in malls, showrooming stores, etc.).

Poland might also finally implement REITs during this period, which could create retail-focused REITs that snap up secondary assets and invest in them. If that happens, it provides an exit to some foreign owners and injects local ownership.

Retail yields (currently ~6.25% prime content.knightfrank.com) could compress slightly with returning investor confidence, perhaps to ~5.5–6.0% for prime by 2027, assuming interest rates come down. Secondary retail will diverge – the best neighborhood centers and outlets will find buyers, while some tertiary malls might struggle to find takers and remain at higher yields or be redeveloped.

Industrial/Logistics Forecast: Poland’s logistics sector should maintain its momentum. We project demand for 5–6 million m² of leasing annually to continue in the near term, supported by e-commerce (which still has runway to grow in Poland’s retail mix) and manufacturers from automotive, electronics, etc., investing in local production. Vacancy might hover around the high single digits in 2025 but likely will start decreasing by 2026 as the construction pipeline slowed in 2024–25. So by 2027, vacancy could normalize back to ~5% or below, which is effectively full occupancy (with just frictional vacancy). This will put upward pressure on rents again; we could see some rent growth especially in urban infill logistics, where land is limited and demand insatiable (for instance, last-mile warehouses around Warsaw may push above €5–6 to perhaps €7–8 per m² by late decade). Big-box rents in central locations might also creep up if land and construction costs increase.

Poland is also likely to benefit from any Ukraine reconstruction effort (though timeline is uncertain) – its border regions will serve as logistical bases, potentially requiring new warehouse space. Additionally, as supply chains regionalize, Poland might attract industries like battery gigafactories, component manufacturing, etc., which will need industrial facilities.

Development of logistics will be more measured – moving from the 2020–2022 speculative frenzy to a more built-to-suit and phased approach. Many developers will secure partial pre-leases before building larger parks now. Environmental factors will also come into play: stricter EU climate policy might push for solar-powered warehouses, zero-carbon construction, and even limit greenfield development in certain protected areas. But Poland has plenty of space for logistics (brownfields and former industrial sites can be reused too).

Industrial investment will likely remain the hottest segment. We foresee yield compression from ~6.25% to perhaps ~5.5% or even 5% by 2027 for prime logistics, as competition for stabilized assets heats up again (similar to the pre-2022 trend). If interest rates fall and the economy is stable, global investors could enter bidding wars for prime portfolios. Poland’s position as a core logistics market in Europe will be entrenched by then, possibly even making it to the “core portfolio” status for more pan-European funds (some already treat it as such).

Land and Development: Land prices in key city zones will rise as developers re-enter the market. We expect that by 2026, assuming interest rates ~4% and stable economy, housing developers will ramp up construction starts again to meet renewed demand. This means they will actively seek land in 2025–2026, driving up competition for good plots. Similarly, logistics developers will continue buying land along highways and near cities, though in a disciplined way. Farmland values may also increase, both from agricultural commodity price trends and from conversion potential near expanding urban boundaries.

The Polish government’s moves to simplify planning (if fully implemented) could dramatically unlock development potential. If by 2025–26, a large portion of municipalities adopt the new General Plans and digitized permitting, we could see a quicker turnaround on projects and more transparency (less uncertainty adds value to land). Also, any deregulation like fast-tracking low-impact projects or loosening farmland conversion rules polandinsight.com polandinsight.com would give a further boost to the land market by making more sites viable. On the contrary, if bureaucracy issues persist, it will cap development pace and keep prices high for the few readily developable plots (not an ideal scenario as it concentrates growth).

Risks to Outlook: While the forecast is broadly positive, there are risks that could alter the trajectory:

• Economic downturn: If a global recession hits (or a sharp slowdown in Germany, Poland’s top trade partner), demand for commercial space could weaken and unemployment rise, hurting housing demand. However, Poland has shown resilience and is starting from a position of strength, so a mild recession would likely be manageable.
• Interest rate surprise: If inflation proves sticky and central banks reverse course to hike rates again, that would dampen financing and investor activity. At the moment, this seems unlikely as inflation is easing and Poland’s NBP is in an easing cycle globalpropertyguide.com, but it’s a factor to watch (energy shocks, etc., could change inflation outlook).
• Geopolitical tensions: The ongoing war in Ukraine is a backdrop risk – any escalation or spillover could severely impact sentiment and economic stability (though Poland has also benefited in some ways economically from hosting refugees and businesses relocating out of Russia/Belarus). Additionally, Poland’s domestic politics (with a new government from late 2023) could introduce changes; however, the current coalition is EU-friendly and pro-investment, so dramatic policy shifts are not anticipated.
• Sector-specific shifts: For offices, a risk is that remote work adoption accelerates or companies drastically reduce space – if, say, AI and automation lead to less need for human office workers, that’s a long-term dampener. For retail, a risk is consumer behavior change beyond current expectations (e.g., e-commerce jumping to 30% of sales unexpectedly fast, though that pace seems improbable given cultural factors). For industrial, one risk is overbuilding if every developer becomes bullish again at the same time – but lessons from the current vacancy rise will likely prevent that.

Despite these risks, expert projections remain largely favorable. For example, a recent NBP survey of real estate professionals indicated expectations of price stability and gradual growth in housing and a dynamic recovery in investment markets as interest rates fall lexology.com etalon-estate.pl. The general sentiment is that Poland’s real estate sector will not repeat the volatility of early 2020s; instead, it will progress on a more moderate growth path with fewer extremes.

Conclusion: By 2028, we envision a Polish real estate landscape characterized by modernized, sustainable buildings; higher participation of institutional investors (including domestic ones); and balanced supply-demand conditions in most segments. The housing market will likely have produced hundreds of thousands more units but will still have unmet demand (keeping developers busy). Offices will be smarter and greener, with older stock repurposed and new skyscrapers gracing city skylines (Warsaw’s skyline in particular is set to be transformed further by projects like the 350m Varso Tower now complete and others in pipeline). Retail will be more experiential, and perhaps Poland might see its first American-style REITs owning portfolios of malls or supermarkets if legislation allows. Logistics will anchor Poland’s role as a critical European distribution hub, possibly expanding into new sectors like data center campuses (which also require industrial land and have started picking up in Poland).

In sum, Poland’s real estate market is poised for growth with maturity. It offers a compelling mix of strong economic underpinnings, improving regulatory environment, and attractive returns that should continue to draw investment and development. As one market outlook aptly stated: “The Polish real estate market remains robust, evidenced by stable occupier demand and a dynamic recovery in investment…with strong market fundamentals and optimism as 2025 progresses” content.knightfrank.com. Barring any major shocks, the next 3–5 years should see Poland’s property sectors advancing steadily on all fronts – delivering opportunities for investors and meeting the evolving needs of businesses and residents alike.

Sources:

• CBRE Poland Market Outlook 2025 (Feb 2025) cbre.pl cbre.pl
• Global Property Guide – Poland Residential Property Analysis 2025 (May 2025) globalpropertyguide.com globalpropertyguide.com globalpropertyguide.com globalpropertyguide.com
• NBP (Polish National Bank) data via GPG globalpropertyguide.com globalpropertyguide.com globalpropertyguide.com
• Strefa Inwestorow – Comments by Dom Development VP (Apr 2024) globalpropertyguide.com
• Polish Economic Institute – Housing report (2024) globalpropertyguide.com
• PKO BP analysis (2024) globalpropertyguide.com
• JLL and Otodom/Polityka Insight housing reports (2024–25) globalpropertyguide.com
• Poland Ministry of Finance / gov.pl – Info on “Bezpieczny Kredyt 2%” and planned “Pierwsze Klucze” globalpropertyguide.com globalpropertyguide.com
• Knight Frank – Investment Market in Poland 2024 (Q4 2024) content.knightfrank.com content.knightfrank.com content.knightfrank.com
• Knight Frank – prime yields (Q4 2024) content.knightfrank.com
• Knight Frank – largest investment deals 2024 content.knightfrank.com
• Newmark Polska – 2024 Office Market Summary & 2025 Outlook polandoffices.com polandoffices.com polandoffices.com
• EuropaProperty/Walter Herz – Regional office space requirements growing (May 2025) europaproperty.com europaproperty.com
• EuropaProperty/BNP Paribas – Retail sector strong start 2025 (May 2025) europaproperty.com europaproperty.com europaproperty.com
• Property Forum/BNP Paribas – retail vacancy and footfall (2024) europaproperty.com europaproperty.com
• Poland Insight – Warehouse Market Stable, Slower Growth (June 2025) polandinsight.com polandinsight.com
• Poland Insight – Land Market in 2025 (May 2025) polandinsight.com polandinsight.com polandinsight.com polandinsight.com
• Reuters – Poland inflation survey (Jan 2025) reuters.com
• Knight Frank Research – Review 2024 & Outlook 2025 (quotes via Bing cache) content.knightfrank.com
• EuropaProperty – Poland’s retail vacancy (2024) europaproperty.com
• Erste Group – NBP projection (Mar 2025) erstegroup.com
• ING/think.ing – rate cut expectations (May 2025) think.ing.com
• Cushman & Wakefield – various market reports (2024) cushmanwakefield.com property-forum.eu.