Where once Dick Whittington set off to London in search of streets paved with gold he’d now be best advised to cook the cat, sort a passport and climb onto the next plane bound for Poland. The buzzword for foreigners is real estate, and there’s a killing to be made out here. But while the glories of Kraków, Warsaw, Wrocław and the like need no introduction Łódź is still something of an unknown quantity for many foreign investors – which makes it all the more appealing to you. With less column inches than the nations more high-profile destinations it’s yet to see the mad headlong rush for property of its rivals, making it a home banker for those adventurous enough to get there before everyone else follows.

Why Łódź?
It’s a good question. Early reconnaissance missions are quickly going to shatter any pre-flight visions you had of a city filled with cobbled alleyways and medieval spires. Ever since the Industrial Revolution gave birth to this city it’s been tagged ‘the Manchester of Poland’, and it’s a comparison that holds substantial weight. This is a primarily a factory city, and its somewhat charred, murky appearance is by no means everyone’s cup of tea. But that should not scare investors off, in fact, it’s one of the reasons people ought to be investing. Forget the stories of factory closures and 20% unemployment (plus) that were doing the rounds in the 1990s – Łódź is fighting back and the special economic zone set up in the region has since attracted a wealth of foreign money: Gillette, Dell, Bosch, Phillips and Indesit are some of the names who’ve set up shop here, and more look likely to follow. Logistically speaking the city is a mecca for blue-chip companies, its location 300km from anywhere in the country making it Poland’s natural hub. Its status as Poland’s second city is another draw, and while in the past the city has deserved its rap for being, frankly, ugly, signs of restoration and redevelopment are everywhere – most obviously in the form of the stonking great Manufaktura shopping and leisure complex. There’s even plans afoot to turn Łódź’s defining eyesore - Łódź Fabryczyna - into a state-of-the-art train station that wouldn’t be out of place in Germany.
There’s plenty of good news for developers as well. Compared to Poland’s other large cities Łódź doesn’t have anywhere near the same number of protected buildings, meaning less building restrictions and lending a large scope for development. At the same time the city is far from just a stack row of factory chimneys. On the contrary; the 19th century industrialists who made their fortunes here liked their style, and the palaces and villas that once belonged to them are their legacy. Historic art nouveau mansions – in varying states of repair – are not hard to come by, and represent a cracking investment to anyone looking for an interesting development opportunity.
Finally, the bit you’ve been waiting for: price. And this is where the news gets even better. Łódź is far cheaper than any of the other principal cities in Poland, meaning that like for like your cash will get your far further than anywhere else in the country. Those who have so far chosen to get involved with Łódź have not been disappointed, with meteoric rates of appreciation reported. As head of Łódź based Landers Property – a company that specializes in acquiring both residential and commercial property for foreign investors – Warren Landers claims it’s not rare to find clients who have bought off-plan apartments in the city to achieve 100% plus growth per-annum on their outlay. ‘The one problem is actually persuading people there aren’t any catches. The fact is the opportunities here are so good people should re-mortgage their own grandmother to get in’.

What to expect
Before signing on any dotted lines Landers advises investors to steer away from any properties where the planning permission isn’t already in the bag. Nor should people just go for a standard property: ‘don’t invest in something that traps you into the local market. Look for something special. Even if the apartment you’re looking at is great, if it’s stuck in a communist block development then you’ll only be renting out or selling to locals’. However, even though return on the rentals market is currently hovering between 7-9% (predicted to grow to 11% in the coming years) appreciation on properties is so high that most investors have chosen to forget even considering being a landlord. The recent election of Donald Tusk’s Platforma party is further good news for Poland, but though the country is moving westwards once more prospective buyers should still be wary of bureaucracy. While capital gains tax now has a flat rate of 19%, and building permits are generally handed out on time, there are still delays in processing Land Registry agreements. In England such a process would take two weeks; in Poland the official waiting time is two months, though in actual fact can often be far longer.

Where to buy
The main high street, Piotrkowska, has long been the centre of most investors attention, but now Łódź is seeing a gradual shift. Landers tips ul. Ks. Bp. W. Tymienieckiego as The Next Big Thing, citing a number of developments there in the process of being built; many of them trendy loft-style apartments inside converted cotton mills, with facilities including concierge service and numerous recreational opportunities. Other developments include the 15 hectare site of one of Karol Scheibler’s former factories, with features numbering a glass observatory, while further out of town potential investors will find spanking new developments with all recreation and infrastructure requirements considered. In general 6,000zł per metre and below will buy you a property at the lower end of the market. For 6,500-8,000zł you’ll be hitting mid-range, while those spending upwards of 8,000zł can expect luxury living with all the bells and whistles you
could think of.

It is always having as much information at your disposal when making an investment particularly in a foreign country. Mamdom's Tim Hill has written the definitive book on buying property in Poland based on his 15 years experience. You can pick up a copy by clicking on the Amazon link below.




Recommended Brokers
Mamdom, www.mamdom.com