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Simeon Mitropolitski is a Canadian analyst, of Bulgarian origin, and a former syndicated columnist with the Bulgarian News Agency (BTA). He is the author of several hundred articles dealing with hot political and economic topics, both national and international.

He was part of the first group of Bulgarian intellectuals and students that began the opposition movement that finally put an end to the communist regime in this country in 1989, and in 1996-1997 participated in international observation teams during the elections in several Balkan countries - Romania, Albania and Bulgaria.

In 2002 Simeon and his family moved from Bulgaria to Canada where they live now in Montreal, province of Quebec. Simeon is a Master of Political Science from McGill University and a B.A. of Political Science and History.

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"You will be really amazed how far Warsaw has gone in the recent years. Its center looks like small Manhattan, there are so many skyscrapers there", said one of my colleagues from BTA learning that I'm going to Riga (Latvia) and will have to stay in Warsaw (Poland) for couple of nights for the flight transfers from and to Bulgaria. By the way in the autumn of 2000 I stayed in the Big Apple for a week so I had fresh personal impressions about the city that "never sleeps". Fortunately too I have lived in the capital of Poland for several months 8 years ago so I went there with "full basket" so to say, waiting to see another "Manhattan".

Well, it wasn't really like NYC center but it was obvious that for the last 8 years Warsaw has made significant steps away from the socialist architectural styles (ugly and gray) and has tried to become far more comfortable for its population and guests. Instead of 2 skyscrapers (in Europe the skyscrapers are usually much smaller than in the USA) in the Warsaw center there are maybe 10, almost all of them filled with prime office spaces. In such high speed of construction maybe in 1000 years Warsaw will look like today Manhattan but this is another story.

I doubt that Polish and international companies will continue to build office spaces (350 000 sq.meters or 3,5 million sq.feet per year) here in the same velocity as it was done in the last years. The main problem is that between 1995 and 2000 the rents in the city went down by half and the yields for prime offices went down too from 14% to less than 10%. Maybe it's time for investors to look at other Eastern Europe countries with bigger yields?

Another totally different story is the residential real estate market. It seems that only the less advanced legislature and bank system in Poland are the main obstacles for the development of the new residential projects. As far as I could see it, in the city there was substantial demand for new and modern houses somewhere in the suburb*. In Warsaw there is a middle class who is ready to pay long-term mortgages but unfortunately there aren't many banks ready to match this demand with long-term loans. So far the limit for repayment of the loans is 20 years and the interest rates are in average 10% above the inflation (compared to 4-5% in the USA).

Of course there are several residential projects in the southern outskirts of the city with thousands of new houses but this isn't the quantity the local population is expecting in order to fulfill their dreams. But what means thousands or even tens of thousands of new houses for a city population of 2 million? And don't forget that Warsaw is by no mean the most advanced town in the country by economic terms.

Recently I was very surprised to learn that the Washington D.C.- Baltimore metro area in the USA was populated by 7,2 million persons (the two cities have combined population of 1,2 million). That means that 5 out of 6 in the area is living in the suburbs. In Eastern Europe in general and in Warsaw in particular the population living in the suburbs and working in the cities is only a small fraction (I doubt there are any exact statistics about that).

So we have a huge potential for residential development in the region. Especially this is true when it comes to Warsaw because the city is situated on vast flat terrain and there is comfortable road infrastructure in almost any directions.

* - In the last couple of years Poland was among the first five markets in Europe in terms of sold new cars. One of the reasons for this boom (in Warsaw more than half of the cars are made in the last 5 years) was the liberal credit policy and bank loans going up to 8-10 years.

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