Luxury goods booming in Poland

In 2019, Poland had 116,000 millionaires. In five years' time, this figure is expected to reach 202,000 – a 74% increase. The forecasts given in the latest “Global Wealth Report” by Credit Suisse point to steady growth in the Polish luxury goods market. These figures are built on another important trend currently afoot: middle-class wages are also on the rise. As a result, more and more people are able to afford exclusive products, from belts to bags and from jackets to watches. In Warsaw, high-end stores were packed with shoppers, day in day out, until the start of the Covid-19 crisis. Jakub, the manager of a prestigious brand store located in the heart of Bracka Street, looks back on the pre-crisis days with delight. “Before the store closed down because of the coronavirus, customers came in by the dozen every day. We couldn't keep up. I had to hire someone new every month to keep up with the demand. I remain confident, because I am convinced that when this difficult time is over it will pick up where it left off. You see, it used to be that Poles who wanted to buy products from major international brands had to go abroad to do it. Not anymore. Today, the sector is developing very quickly in our country. This is good for our economy and it boosts employment as well.” And there seems to be something particularly Polish about this growth: here, material luxury is still going strong. “I’ve read some articles that say the wealthy now prefer to spend on travel rather than things, bags, clothes or watches,” Jakub continues. “But in Poland this is not yet the case. There is a strong desire to break away from our communist past by displaying prestigious brands’ logos. And that only makes sense.”    

That appetite is also reflected in the luxury real estate market. Nina, a 35-year-old independent real estate broker, still can't quite believe it. In three years, her annual turnover has increased twenty-fold. “Even in these complicated times, my phone is ringing off the hook all the time,” she explains. “Prices are keeping pace with this explosion in demand, having risen by 20 percent in Warsaw in 2019. Prices are also going up in other parts of the country, but less dramatically. What I see is a desire for exceptional property in the most exclusive areas of the capital, like the Zlota 44 tower designed by local starchitect Daniel Libeskind. Its 287 exclusive apartments are fitted with all the bells and whistles - like domotics, which my clients are really keen on.” Where else do wealthy Polish tax subjects like to take residence? Andrzej Marczak, a partner at KPMG Poland, has the answer: “Most wealthy people live in the Mazovian, Silesian and Lower Silesian regions. These are among the most dynamic areas, which are also the commercial and industrial hubs of the country. At the other end of the spectrum are the provinces of Lubusz, Holy Cross and Opole.”

In Poland the wealthy are no longer shy about spending their money. This new social class is made up of bankers, entrepreneurs and real estate developers, and they are the new clientele of a luxury sector that is growing at an annual rate of more than 10%. Tomasz Wisniewski, partner at KPMG Poland, confirms our impressions. “We expect the growing trend in the luxury goods market to continue. This is due to the fact that Polish society is getting richer and the change in lifestyle that this entails means greater popularity for premium and luxury products. Based on our estimates, the luxury goods market in Poland will exceed 9.2 billion euros in 2023.” This surge is being driven by purchases of jewelry, watches, spirits and luxury cars, and it’s becoming an absolute craze. One example is Ferrari, which now has two dealerships operating in Poland, one in Warsaw and another in Katowice. According to our sources, their sales have been growing at an annual rate of 15% over the last five years…