How the proximity of an airport can block the development process
Approval of the master plan for Warsaw Chopin Airport in July 2023 has paralysed real estate development in the city. Why? And is there a cure?
Extension of the relief sought on appeal should be more available
For years, the rules limiting the extension of a claim on appeal have been a challenge for counsel determining their litigation strategy when seeking damages in tort cases. Over many years of court proceedings, the value of the claims may change as prices rise. But the Polish courts require the amount of the claims to be frozen as of the time of entering the judgment in the first instance, even though there is a long way before the end of the court dispute.
Investment property and tax expenses
One of the challenges facing real estate companies is the limitation of claiming tax costs for depreciation on real estate, effective from 2022. Sometimes, the only way out will be tax litigation.
Minimum tax on building income
The minimum tax on income from buildings in Poland was reinstated as of 2022, and the reinstatement brought with it a return of interpretive doubts making it difficult for taxpayers to apply the tax. These doubts include whether hotel services are covered by the minimum tax, and whether depreciation deductions on buildings and income from common areas should be factored in when calculating the tax.
The master plan
Pursuant to the 7 July 2023 amendment to the Spatial Planning and Development Act, the zoning study will be superseded by a master plan and commune development strategy. The provision imposing an obligation on communes to adopt a development strategy enters into force on 1 January 2026. Introduction of master plans is intended to vest more power in local governments in Poland in establishing policies for land use and development.
Integrated development plan
The July 2023 amendment to Poland’s Spatial Planning and Development Act introduced a special form of local zoning plan—the integrated development plan. It grants communes and investors more freedom to locate development projects, regardless of the findings of the existing local zoning plan. Ultimately, integrated development plans will replace the resolutions on siting of housing developments issued under the housing special act (such resolutions can be issued until the end of 2025). But an integrated development plan can be enacted for any type of project, not just residential projects.
The urban register and instruments of public participation
The recent overhaul of the Planning and Spatial Development Act tidied up and streamlined the planning procedure. In addition to revolutionary changes, such as replacement of the zoning study with the master plan and commune development strategy, as well as introduction of integrated development plans as a special type of local zoning plan prepared at the initiative of private investors, a nationwide urban planning register was introduced, and the catalogue of tools for public participation in land use and development issues was expanded.
How to determine land development conditions
The amendment to the Spatial Planning and Development Act will change a lot when it comes to determining land development conditions in Poland. Therefore, especially in areas where no local zoning plan exists, investors planning a construction project should apply for a land development decision as soon as possible.
Is this the end of the revitalisation pre-emptive right in Warsaw?
There are many indications that as of 16 March 2024, the City of Warsaw will no longer be vested with a pre-emptive right to purchase real estate in the degraded area and revitalisation area of the city designated by Resolution LX/1967/2022 of 17 February 2022.
Environmental aspects of real estate development: What will 2024 bring?
The environment is a key element of real estate development and construction, and has a major impact on the duration of the process. In 2023, there was increased legislative activity in this area, but we will not know its real impact on the construction process until 2024.
What fee model to use in construction contracts?
The choice of a fee model is a key element of any contract for construction works. In market practice, several mechanisms are in place for determining the payment method, each of which has its advantages and disadvantages. The chosen fee model should correspond to the specifics and scope of work and take into account the interests of both parties to the contract.
Overview of major changes to the Construction Law
In 2022, the Polish parliament introduced a number of significant changes to the Construction Law. The most important of these are related to further digitalisation of administrative processes in construction. The amendment introduced the ability to maintain a daily construction log and site book in electronic form, as well as an electronic central register of licensed builders. The administrative procedures have also been simplified for construction of single-family houses with an area of up to 70 m2, and new obligations for the energy performance of buildings have been implemented.