Polish Real Estate: from boom to balance (Develia stays BUY, Dom Development (transfer of coverage) and Murapol upgraded to BUY)
We remain constructive on the Polish residential sector, although we expect a more balanced operating environment in 2026-28E vs. the exceptionally strong 2020-25 period. Rate cuts should support demand and mortgage affordability, but the record-high supply in the six largest cities (>70k units) is likely to limit price growth and drive a gradual normalisation in margins across the sector. In this environment, we prefer companies with stronger balance sheets and higher exposure to the largest markets. Develia remains our top pick (BUY, price target (PT) at PLN 13/share (from PLN 9.9/share)), offering the strongest growth profile (a c.15% revenue CAGR in 2025-28E), which we see as the best-positioned to benefit from the ongoing investment cycle. We transfer coverage of Dom Development, and upgrade it from Hold to BUY, while upping our PT to PLN 315/share (from PLN 251/share), viewing it as the most defensive name in the sector, supported by a strong balance sheet (c.0.3x ND/EBITDA), resilient margins, and exposure to the largest residential markets. Murapol continues to stand out primarily for its dividend yields (11.7-12.3% in 2026-28E), but we remain more cautious, given its higher leverage and greater exposure to the regional markets. We have upgraded the stock from Hold to BUY and increased our PT (from PLN 44/share to PLN 50.3/share), following the company’s higher focus on large markets, but the risk-reward is less compelling vs. its peers.Develia SA Formerly known as Lc Corp. S.A.. Develia SA, formerly known as LC Corp SA, is a Poland-based holding company engaged in the real estate development operations. It is involved in the acquisition, management, rental and sale of commercial and residential properties located in such Polish cities as Warsaw, Wroclaw, Krakow, Lodz, Gdansk and their surroundings. Its main development projects in the commercial properties area include Arkady Wroclawskie shopping and retail complex in Wroclaw, as well as an office complex, Wola Center in Warsaw. In the area of residential investment it develops apartments houses Przy Promenadzie, Rezydencja Kaliska and Powstancow 33 in Warsaw; Maestro and Vratislavia Residence in Wroclaw; Debowa Ostoja in Lodz; as well as Niepolomicka and Srebrena in Gdansk. The Company owns 99.95% stake in LC Corp Invest XV Sp z o o Investments SKA. and 100% stake in Sky Tower SA, in the the Netherlands.
Dom Development is engaged in the construction and sale of residential real estate in Poland.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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