Lublin – thriving hub for innovation and investment

The fourth edition of the Business Environment Assessment Study (BEAS), crafted by Antal and Cushman & Wakefield, bolstered by Baker McKenzie, PAIH, Pracodawcy RP, Pro Progressio, and Vastint, unveils investment plans for the years 2023-2025 in Polish cities. Poland maintains and fortifies its position as a leader in attracting both domestic and foreign investments. Currently, Lublin stands as the largest economic and academic hub in Eastern Poland, actively engaging in networks of cooperation among European and global metropolises. It is regarded as one of the most dynamically developing Polish agglomerations, ranking highly in sustainable development, smart cities, absorption of EU funds, and investor attraction.

Favourable Investment Conditions

As the most developed city in Eastern Poland in terms of investment potential, Lublin has experienced dynamic economic growth in recent years, leading more and more companies toestablish their business here.  In 2022, it was recognized by the “fDi Magazine” as one of the most attractive cities of the future in Central and Eastern Europe

Lublin is a city in dynamic evolution, not only leading in economic but also in cultural and academic spheres, increasingly competing with top Polish cities. Infrastructure investments, a high quality of life, and excellent cooperation with universities and the socio-economic environment render the city an attractive location for establishing manufacturing plants and branches of nationwide and international companies in modern business services. With the growing community of foreign students and the inclusion of a large number of refugees from Ukraine, Lublin is reclaiming its flagship multicultural character, explains Dr. Mariusz Sagan, Director of the Strategy and Investor Relations Department, Lublin City Council.

The city increasingly attracts workers from various regions of Poland, as well as from Ukraine, owing to favorable living conditions, recognized by business representatives, confirming the high rating of 7.8/10 for this area in the report.

Vibrant Labour Market

The advantasge of Lublin’s labour market is a good access to diverse, qualified specialists, experts with IT skills, as well as sales, accounting, financial, administrative, and linguistic competencies. Over 600,000 people reside within Lublin Metropolitan Area, including over 180,000 with higher education. This is attributable, among other factors, to Lublin’s significant educational potential, with nine higher education institutions graduating annually between 15 to 20 thousand graduates, ready to harness their talents. Undoubtedly, this serves as one of the magnets attracting entrepreneurs and foreign investors.

Over the past 4 years, a revival is evident among emerging manufacturing plants, providing jobs for both production workers and specialists in engineering, and managerial positions. Companies recognize the attractiveness of Lublin as an academic city with an available student base and the potential generated by numerous initiatives promoting innovation. In recent years, investments have been made by, among others, the German company Data Modul, which opened in Lublin’s Felin, the French Varroc Lighting Systems (now Plastic Omnium) in Niemce, the Turck company, or the latest investment by Trilux, which chose Świdnik for a production-research project. It is also worth mentioning the investment of DB Schenker, which opened a branch in the Świdnik Economic Activity Zone, explains Aleksandra Kurasiewicz, Senior Client & Team Manager, Engineering & Operations, Antal.

Convienent location and rapid infrasatructure development with the Lublin’s Airport leading the way.

Lublin is characterized as an excellent place for business development and building a logistics base, favored by companies operating in both Eastern and Western markets or planning to expand into these regions. The proximity to the borders with Ukraine and Belarus, as well as excellent road connections, work in favor of this. Consequently, the infrastructure received a rating of 7.2/10 in the report.

Lublin hosts the largest transportation hub in Eastern Poland. In recent years, the S17 road has been completed, providing fast connections to Warsaw, and part of the S19 (Via Carpatia) between Lublin and Rzeszów, which is part of the trans-European corridor leading from Lithuania to Greece. Work is underway on another section of the S19, which will connect Lublin with Białystok. Sections of the S17 leading through Zamość to the border crossing in Hrebennem and the S12 leading through Chełm to the crossing in Dorohusk are also under construction. The development of road infrastructure heralds the influx of new business, says Agnieszka Gułaś, Senior Negotiator, Cushman & Wakefield.

In recent years, the city’s transportation accessibility has increased, and the international airport is the city’s showcase. In March 2023, the company Port Lotniczy Lublin SA applied for permission to build a cargo terminal, and the new hall is planned to be put into use in 2024. This will expand the export-import capabilities of companies located in the Lublin Voivodeship and will be another development accelerator for the region.

Lubin’s office market

Lublin’s office market grows in line with its business potential, ranking as the seventh office market on the regional map of Poland, with modern office space exceeding 200,000 square meters, reaching over 220,000 square meters in 2023. It is the largest and most mature market in this part of Poland. Despite the supply that has occurred in recent years, the vacancy rate has been steadily decreasing – in the fourth quarter of 2023, it reached 11.9%. This is due to high demand, which in 2023 amounted to over 21,600 square meters. Several investments are currently in the planning phase, with the most important being the next stage of the CZ Office Park and Gęsia projects, as well as a new office building planned at the roundabout named after Honorowy Krwiodawców. The implementation of these projects seems necessary to effectively reduce the risk of a supply gap appearing in the Lublin market in the coming years, says Michał Grabowiecki, Senior Negotiator, Cushman & Wakefield.

The investment climate of the city, as well as the rapidly growing office space market, contribute to increasing interest in Lublin as an attractive place for business development. In recent years, there has been increased activity of companies in the modern business services and IT sectors. Currently, there are dozens of BPO/SSC/IT centers operating in Lublin, employing over 8,000 people. Additionally, Lublin’s economic traditions and the geographical conditions of the region have contributed to the development of industries such as automotive, logistics, biotechnology, and food processing. The analytical team from the “Financial Times” group has recognized Lublin as one of the most attractive cities for business in Poland in terms of location for direct foreign investments.

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