The Lokum Developer Group, which is one of the leading developers operating in the Lower Silesia and Malopolska real estate markets, recorded significantly higher sales results in the third quarter of this year than in the corresponding period of 2022. From July to September, the developer signed 196 preliminary and developer contracts, representing a 90% year-on-year increase.
Lokum Developer, offering apartments of a higher standard, in the third quarter of 2023 alone signed developer and preliminary contracts for 196 units: 146 in Wroclaw and 50 in Krakow. At the end of September, the Group had also signed 52 reservation contracts, a year-on-year increase of 86%. From January 1 to September 30, 2023, the developer signed 558 developer and preliminary contracts, which is an improvement of the reported result by 99% compared to the same period last year.
Over the first three quarters of this year, the Group recognised the revenue from 366 apartments (+34% YoY): 189 in Wroclaw and 177 in Krakow. In the third quarter alone, Lokum Developer transferred 135 units to customers, 26% less than the previous year. The lower figure is connected with the schedule for the implementation of different stages of investments.
From the start of 2023 to the end of September, the developer realised the potential revenue recognition in 66%, which involves 858 units that have been recognised or are covered by developer contracts, preliminary contracts or reservation contracts.
“We have been experiencing significant improvement in the market from the beginning of the year. We are pleased with the better financial situation of our customers, which despite rising costs, allows them to meet their postponed housing needs. We have noted, thanks to this situation, stable sales at twice the level compared to the crisis year. However, the clients are increasingly concerned about the rapidly decreasing supply of apartments in both primary and secondary markets, which is leading to a dynamic increase in their prices. This is particularly noticeable in Krakow. I am not surprised, considering the slow processing of building permits by the city council. The fewer new investments in the market, the secondary market which dictates prices not through costs – as it is in case of developers – but through sellers’ appetites, has a greater impact on apartment prices. A remedy for slowing the rise in apartment prices seems self-evident. It is necessary to accelerate the adopting of local spatial development plans, issuing environmental decisions and building permits for new investments, which city authorities should consider. In Wroclaw we notice a significant change in understanding this situation.” – says Bartosz Kuźniar, CEO of Lokum Developer.
At the end of the third quarter, the developer had 469 apartments on offer, including 220 in completed investments. On the last day of September, the Group was constructing 487 units.
Lokum Developer holds a large land bank, which – except for the investments under construction – covers an area of 75 hectares, allowing for development of nearly 12,000 properties.
