PKP gears up for property development

Architectural vision of the new Warszawa Główna station in the capital's downtown. Image courtesy: PKP

State-owned railway group PKP is not only a transportation giant. It also owns valuable land in the country’s major cities and may soon become an important player in property development.

Earlier this week, PKP announced that six real estate firms had expressed their interest in developing the group’s 10-hectare plot on the grounds of the former Warszawa Glowna station, close to Warsaw’s city centre.

“The project has an estimated preliminary value of 900 million euro,” PKP’s real estate director Jaroslaw Bator told Gazeta Wyborcza. “When it’s commercialized, it will be worth even more.”

PKP’s large real estate projects may have an aggregated value of almost 9 billion zloty (about 2.2 billion euro). The land to be developed includes several plots in Warsaw, plus areas in Wroclaw, Krakow and Gdynia.

“We will become one of the main players on the Polish property market,” Bator said. The proceeds from this activity will be used to refinance the company’s debt and on the maintenance of railway stations, he explained.

As of the end of June, PKP had debt worth 2.47 billion zloty (about 600 million euro). Station maintenance requires some 93 million zloty (some 22 million euro).

Apart from managing the big projects, the railway group also intends to increase revenue from its smaller railway stations. In the first stage, new buildings with commercial space of between 700-7,500 square metres will be built on seven stations in Warsaw, Katowice and several smaller cities. (kw/jb)