InRento, a Lithuanian crowdfunding platform for buy-to-let projects, finances the conversion of a residential building in Kalisz, Poland. Over 2.5 years, the project will be converted to 8,500 sqm of residential and 1,000 sqm of commercial space. The investment in the project will amount to EUR 8.74 million, of which InRento will finance EUR 3.5 million.
The project, which is being developed in Poland's oldest city, will provide 160 apartments and 6 commercial premises. The apartments will range between 40-60 sqm and the average price will be EUR 1,250 per sqm. Construction is expected to be completed in Q1 2027.
The project is to be financed in several phases. InRento will provide EUR 2.45 million of financing until the end of 2024, and the remaining EUR 1.05 million will be made available to the developer on a phased basis during the remaining construction period.
According to Gustas Germanavičius, CEO of InRento, Poland is currently offering a unique opportunity for real estate investments due to political and economic reasons. This is the fifth project the company has financed in Poland.
"Our experience helps us identify the specifics of this market better. First of all, government incentives allow residents to buy economy class housing on favorable terms. This creates strong demand. On the other hand, in Poland, bank financing for developers is very expensive and slow, so there is not enough of a supply of projects. It is the interaction of these two elements that allows us to finance highly liquid projects in Poland and to ensure a good risk-return ratio for investors," says G. Germanavičius.
The Polish equivalent of EURIBOR, WIBOR, is currently close to 6% in Poland. With the addition of the bank's profit margin, interest rates for residential mortgages can be as high as 10%. In response to this situation, the Polish government has granted incentives to people buying their first home up to EUR 150,000. Such buyers will enjoy a fixed interest rate of 2% for the first 10 years.
"The apartments developed in this project will be priced between EUR 50,000 and EUR 80,000 and will therefore qualify for a subsidized loan. In addition, the economy class housing is always the most liquid and the easiest to sell, simply because it has the largest number of potential buyers," says the CEO of InRento.
Kalisz, located in the western part of Poland, has a population of around 100,000. The city is characterised by a picturesque old town and a vibrant university culture. The new project is just 2 kilometers from the Old Town.
"In Poland, we see a lot of German investors buying property. For them, this market is very cheap and at the same time understandable and safe, because it is a neighbouring country and a country they know quite well. In Kalisz in particular, there is no shortage of investors who are not buying apartments for themselves, but who want to rent them to young people," says G. Germanavičius.
The project will be managed by HoBu team, a Lithuanian-Polish real estate company that has been operating in Poland for 8 years and has developed tens of thousands of square metres of residential space.
