ZSZ Investment Fund doubles profits, grows retail and industrial holdings

The ZSZ Investment Fund, led by former ČEZ CEO Martin Roman, posted a record net profit of CZK 1.4 billion in 2024, doubling its earnings from the previous year. The fund also saw a parallel increase in the value of its assets, reflecting its aggressive expansion strategy across Central Europe.

A key driver of this growth was the fund’s 61% stake in SCI Eagle, a company that owns and operates six shopping centres in Poland. The portfolio, acquired last year, includes properties located in Warsaw, Bydgoszcz, Łódź, Szczecin, Toruń, and Wrocław, with a total leasable area of 219,000 square metres. The acquisition marked one of the largest retail property transactions in the Polish market in recent years, strengthening ZSZ’s presence in the region’s retail sector.

In the Czech Republic, ZSZ also expanded its industrial real estate holdings. The fund secured full ownership of industrial parks in Kolín and Pardubice, increasing its original one-third stake to full control. These parks serve a mix of logistics, manufacturing, and light industrial tenants and are viewed as strategic assets amid growing demand for industrial space near Prague and major transport corridors.

Additionally, the fund made significant investments in development projects beyond retail and industrial properties. It partnered with UDI Group on the redevelopment of the Smíchov railway station area in Prague, acquiring substantial land positions in what is one of the capital’s largest urban regeneration schemes. The project is expected to transform the former railway site into a mixed-use neighbourhood featuring residential, office, and retail components.

“Our results reflect not only strong asset performance but also our strategic focus on growth markets in Central Europe,” said Martin Roman, Chairman of the ZSZ Investment Fund. “We will continue to seek opportunities in retail, industrial, and development sectors, while expanding our footprint in high-potential locations.”

The fund’s diversification across asset classes and countries has helped mitigate market risks and position ZSZ as a key player in the regional investment landscape. Analysts note that ZSZ’s combination of stable income from retail assets and value-add potential from redevelopment projects offers a balanced portfolio strategy.

Looking ahead, ZSZ plans further acquisitions, particularly in logistics and urban redevelopment, as it capitalises on rising demand for modern space in both Poland and the Czech Republic. The fund is reportedly evaluating additional projects in secondary cities, where growth in e-commerce and regional economic activity are driving new real estate requirements.

Source: e15 and comp.

EU announces plan to end dependency on Russian energy

The European Commission has unveiled a roadmap to end the European Union’s dependency on Russian energy imports, aiming to phase out Russian gas, oil, and nuclear energy in a coordinated and secure manner. The initiative, part of the REPowerEU Roadmap presented today, seeks to ensure stable energy supplies and prices while reinforcing Europe’s energy security.

Despite progress under the REPowerEU Plan and sanctions imposed following Russia’s invasion of Ukraine, the EU experienced a rebound in Russian gas imports in 2024. The Commission warned that continued reliance on Russian energy poses a security risk, calling for more coordinated action across Member States.

“The war in Ukraine has brutally exposed the risks of blackmail, economic coercion, and price shocks,” said Commission President Ursula von der Leyen. “We have diversified our energy supply and drastically reduced Europe’s former dependency on Russian fossil fuels. It is now time for Europe to completely cut off its energy ties with an unreliable supplier. Energy coming to our continent should not finance a war of aggression against Ukraine.”

The roadmap outlines a gradual phase-out of Russian energy imports, with measures designed to maintain energy security and limit impacts on prices and markets. From 2025, global liquefied natural gas (LNG) supplies are expected to increase significantly while EU gas demand will decline. The EU aims to replace up to 100 billion cubic meters of natural gas by 2030, cutting demand by 40 to 50 billion cubic meters by 2027. At the same time, LNG capacity is projected to rise by 200 billion cubic meters by 2028—five times the EU’s current imports of Russian gas.

The European Commission plans to submit legislative proposals next month to implement the roadmap. Member States will be required to prepare national plans by the end of the year, detailing how they will contribute to the phase-out of Russian gas, oil, and nuclear energy.

As part of the plan, the Commission will improve transparency and monitoring of Russian gas within EU markets. New contracts for Russian gas, whether pipeline or LNG, will be prohibited, and existing spot contracts will be terminated by the end of 2025. The EU aims to reduce Russian gas imports by one-third by the end of this year, with all remaining imports to be phased out by the end of 2027.

The roadmap also includes actions to address the use of Russia’s so-called “shadow fleet” in transporting oil. In the nuclear sector, upcoming proposals will cover restrictions on imports of enriched uranium and related materials from Russia, as well as limits on new supply contracts under the Euratom Supply Agency. A European Radioisotopes Valley Initiative is planned to secure the EU’s supply of medical radioisotopes through increased domestic production.

The roadmap builds on measures taken since the launch of the REPowerEU Plan in May 2022. Since then, the EU has reduced Russian gas imports from 150 billion cubic meters in 2021 to 52 billion in 2024, cutting Russia’s share of EU gas imports from 45% to 19%. Russian coal imports have been banned, while oil imports have dropped from 27% at the start of 2022 to 3% today. Member States using Russian-designed VVER nuclear reactors have begun transitioning to alternative fuel sources.

By fully phasing out Russian energy, the EU aims to mitigate security risks, strengthen its economy, and advance its decarbonisation goals, aligning with broader initiatives such as the Competitiveness Compass, the Clean Industrial Deal, and the Affordable Energy Action Plan.

UDI Group sells Sázava Logistics Park to SEGRO European Logistics Partnership

Czech international developer UDI Group has completed the sale of its logistics complex, Sázava Logistics Park, located at the 34th kilometre of the D1 motorway near the village of Ostředek. The property was acquired by SEGRO European Logistics Partnership. The parties have agreed not to disclose the sale price.

The park comprises four fully leased warehouses with a total area of over 46,000 square metres. The facility, which required an investment of more than €36 million to develop, currently provides employment for approximately 300 people.

“The Sázava Logistics Park was completed in 2023, but at that time, investor interest in the Czech market was subdued due to the war in Ukraine and the energy crisis,” said Jan Chromeček, Development Director at UDI Group. “We decided to wait for more favourable market conditions to achieve our targeted price. We are pleased the project has been acquired by SEGRO, a company with over a century of experience in logistics real estate across Europe.”

UDI Group, originally from the Czech Republic, is an international developer active in residential, office, and industrial projects across Europe and Latin America. The company currently has 21 projects in preparation, with expected revenues of €2.5 billion in the coming years.

Following the sale, UDI Group continues to expand its logistics portfolio and is planning a new complex on the D5 motorway. The upcoming project will include three warehouses totalling 130,000 square metres, with an estimated investment of €140 million.

Czech developer Domoplan to build CZK 4 billion luxury resort in Croatia

Czech developer Domoplan has announced plans to invest CZK 4 billion in the construction of a luxury resort, Plava Uvala, on the Croatian island of Pag. The five-star complex, covering 300,000 square metres, is designed to accommodate up to 3,000 guests and is expected to be completed between late 2027 and early 2028.

The resort will feature 300 luxury bungalows with sea views, six swimming pools, a two-kilometre beach, an 800-seat amphitheatre, and a marina for sailboats and boats. Additional amenities will include a dedicated camping area for motorhomes, each with private bathroom facilities.

Domoplan’s owner, Tomáš Vavřík, said the land for the resort had been a long-term target. “Acquiring this site has been my dream for 25 years,” he noted. The company has secured key building permits and is progressing through the remaining administrative approvals.

Financing for the project will come from multiple sources, including an international investment fund established in partnership with Family Ace. Domoplan will contribute from its own resources, while additional funding will be raised from Czech and international investors and supplemented by bank loans.

The Plava Uvala project marks Domoplan’s third venture abroad. The company previously launched two residential projects—one in Belgrade, Serbia, and another in Samobor, Croatia. Sales of apartments in Samobor are already underway, while sales in Belgrade are scheduled to begin this autumn.

Polish government approves deregulation package aimed at simplifying tax rules

The Council of Ministers has adopted a package of draft laws as part of an ongoing deregulation process, introducing changes intended to increase legal certainty for taxpayers, simplify administrative requirements, and clarify procedures following tax and customs inspections.

One of the key measures is an amendment to the Tax Ordinance Act that introduces a six-month vacatio legis for new tax laws and amendments submitted to the Sejm. This transition period is designed to protect taxpayers from sudden regulatory changes and allow time to adapt to new obligations. The rule will apply in cases where legislative changes introduce less favourable conditions for taxpayers. The measure is scheduled to take effect on 1 January 2026.

Another change involves raising the threshold for VAT exemption from PLN 200,000 to PLN 240,000 in annual sales. The adjustment applies both to businesses already operating and to those starting during the tax year, who will continue to calculate eligibility proportionally. This amendment will also take effect from 1 January 2026.

The government also approved the elimination of the requirement for large corporate income tax (CIT) payers to prepare and publish information about their implemented tax strategy. The Ministry of Finance estimates that nearly 4,300 taxpayers will benefit from the removal of this administrative obligation. This amendment is set to come into force the day after its publication in the Journal of Laws.

Additional changes were introduced in the handling of tax returns following customs and fiscal inspections. Under the proposed amendment, audited taxpayers will be allowed to submit a partial correction of their tax returns after an inspection, rather than being required to fully accept all identified irregularities. Furthermore, taxpayers will be permitted to submit an “original” tax declaration within 14 days after an inspection begins or ends, addressing previous uncertainties about the recognition of such declarations during the inspection process. These provisions are also scheduled to take effect on 1 January 2026.

The government said the measures are aimed at improving the stability and predictability of tax law, reducing administrative burdens, and streamlining post-inspection procedures for businesses.

Poland launches PFR Deep Tech programme with PLN 600 million for advanced technology investments

The Ministry of Finance, the Polish Development Fund (PFR), and PFR Ventures have launched the PFR Deep Tech programme, aiming to support investments in advanced technologies. The programme will have a budget of PLN 600 million, with PLN 300 million provided by PFR funds and an additional PLN 300 million contributed by private and institutional investors.

The initiative will operate through a fund structure, directing capital to venture capital fund managers who will invest in high-potential technology projects. The programme is designed to foster the development of advanced technologies, including dual-use solutions with both civilian and military applications.

“In today’s geopolitical reality, defence and new technologies are key pillars of a strong state and competitive economy,” said Andrzej Domański, Minister of Finance. “PFR Deep Tech is one of the first initiatives to build a coherent ecosystem that combines public capital, private investment, and expertise to support innovation and investment.”

Jakub Jaworowski, Minister of State Assets, added: “The state should not replace market mechanisms but support forward-looking projects that are strategically important. Innovation in the dual-use sector is especially critical in the current geopolitical context.”

Piotr Matczuk, President of the Management Board of PFR SA, highlighted that the programme aligns with PFR’s mission to strengthen Poland’s long-term economic and defence resilience. “With the launch of the programme, we join global leaders in fostering the development of deep and dual-use technologies,” he said.

Aleksander Mokrzycki, Vice-President of PFR Ventures, noted that the first investment decisions are expected in the coming months. “We have strong market insight and experience in managing fund programmes, allowing us to efficiently launch operations in this strategic area,” he said.

The PFR Deep Tech programme was developed following analysis of similar initiatives in France, the UK, and the US. The Ministry of National Defence is also involved in the project, building on its existing cooperation with PFR Ventures under the NATO Innovation Fund.

The programme plans to allocate capital to 3–5 specialised venture capital funds, with the expectation that funding will ultimately support 50–80 advanced technology projects. Target sectors include artificial intelligence, defence, robotics, cybersecurity, quantum technologies, and space technologies, with a focus on projects offering dual-use potential.

“We must use every available tool to support the development of breakthrough technologies in Poland,” said Krzysztof Gawkowski, Deputy Prime Minister and Minister of Digital Affairs. “I believe the launch of the PFR Deep Tech programme will provide new opportunities for Polish innovators, and I hope this is just the beginning.”

HIH signs two lease agreements totalling 36,000 sqm in logistics properties

HIH Invest Real Estate (HIH Invest) has signed two lease agreements covering a total of 36,000 square metres across logistics properties in Großbeeren and Bremen.

In Großbeeren, south of Berlin, a logistics service provider has extended its lease for approximately 29,000 square metres ahead of schedule. The site is used for last-mile distribution in the Berlin metropolitan area and as a hub between Germany and Eastern Europe. Located at Märkische Allee 4-10 within the GVZ Großbeeren freight centre, the property includes 168 parking spaces and a rooftop photovoltaic system. It was built in 2010/11 and acquired by HIH Invest in 2021 for the open-ended special fund ‘Deutschland Logistik Invest.’ The lease has been extended until spring 2028.

In Bremen, a technology company has signed a new lease for nearly 6,200 square metres at Bordeaux-Straße 3, running until the end of 2029. The property, constructed in 2011/12 on a 13,000-square-metre site, includes 5,853 square metres of hall space and 340 square metres of office and social space, along with a rooftop photovoltaic system. HIH Invest acquired the property in 2022 for its open-ended special fund ‘Deutschland+ Core Logistik Invest.’

Both properties are located in established logistics areas with access to regional and international transport networks.

Retail turnover in Slovakia fell in March 2025 as household goods and online sales declined

Retail turnover in Slovakia continued its downward trend in March 2025, marking the second consecutive month of decline. According to data released by the Statistical Office of the Slovak Republic, retail turnover decreased by 2.5% year-on-year, with the majority of retail categories recording lower sales compared to the same period last year.

After seasonal adjustment, retail turnover also fell month-on-month by 1%. The decline was mainly driven by lower sales in hypermarkets, supermarkets, and stores selling household goods, which together make up a significant portion of the sector. Hypermarkets and supermarkets, accounting for around 40% of the retail industry’s turnover, saw their sales decrease by 4.5% year-on-year.

In contrast, specialized stores selling textiles, footwear, drugstore products, and pharmacy goods experienced growth. Their turnover rose by 6.4% year-on-year, continuing an 18-month streak of increases in constant prices.

However, other retail categories recorded notable declines. Turnover in hobby markets, furniture outlets, and electronics stores fell by 9% year-on-year. Online retail and mail-order sales also declined, posting a 3.2% drop. Smaller retail sectors, such as specialized food and beverage shops, tobacco outlets, and stores selling sports equipment, books, and toys, also saw their turnover shrink by more than 9%. Sales through market stalls and similar outlets followed the same downward trajectory.

Despite the overall decline, some segments performed better. Retailers of information and communication technology equipment recorded a significant year-on-year increase in turnover. Fuel sales also rose slightly.

For the first quarter of 2025 as a whole, retail turnover in Slovakia fell by 1.5% compared to the same period last year. Seven out of nine retail segments recorded a decline in turnover during this period.

Elsewhere in the internal trade sector, other areas showed positive developments. Sales and repairs of motor vehicles increased by 10.6% year-on-year in March 2025. The food and beverage service sector saw turnover rise by 5.3%, while wholesale turnover increased by 12.1%. Accommodation turnover, however, edged down slightly by 0.4% compared to March 2024.

Month-on-month data showed that motor vehicle sales and repairs rose by 6% in March 2025 after seasonal adjustment, while turnover in food and beverage services increased by 2.2%. By contrast, wholesale turnover fell by 0.3% and accommodation turnover declined by 5.2% over the same period.

Looking at the first three months of 2025 overall, wholesale turnover increased by 8.2% year-on-year, food and beverage services rose by 2.6%, and accommodation turnover was marginally higher by 0.3%. Meanwhile, turnover from the sale and repair of motor vehicles declined by 1.9% compared to the first quarter of 2024.

The figures indicate that while select retail segments and broader trade categories showed resilience, the overall retail sector faced ongoing challenges, particularly in household goods and online sales.

Source: SOSR

Industrial production in Czechia rises 0.7% year-on-year in first quarter of 2025

Industrial production in the Czech Republic increased by 0.7% in the first quarter of 2025 compared to the same period last year, according to official data. On a quarter-on-quarter basis, production rose by 1.5%. The number of working days was unchanged from the first quarter of 2024, providing a consistent comparison.

The data show that industrial production in early 2025 remained largely stable relative to the previous year, edging just 0.8% above the level recorded in 2021. Growth was primarily supported by the electricity, gas, steam and air conditioning supply sector, which benefitted from a lower comparative base in 2024. In contrast, mining and quarrying activities saw a decline, while manufacturing output stagnated, recording a slight decrease of 0.2% year-on-year.

The modest increase in overall industrial output was driven by several manufacturing activities. Positive contributions came from the repair and installation of machinery and equipment, which grew by 6.3%; the manufacture of machinery and equipment, up 2.2%; and the manufacture of food products, which rose by 2.9%. However, declines in key sectors weighed on the broader result. The manufacture of motor vehicles, trailers and semi-trailers fell by 2.1%; production of other transport equipment dropped by 11.6%; manufacture of computer, electronic and optical products declined by 3.6%; and chemical production contracted by 2.5%.

Sales from industrial activities, measured at current prices, rose by 0.2% year-on-year in the first quarter. Export sales increased by 2.4%, while domestic sales – including indirect exports – fell by 2.3%. Growth in sales was led by the food industry, which saw a 4.9% increase; machinery and equipment, up 4.3%; and repair and installation of machinery, which expanded by 10.9%. Meanwhile, the largest declines in sales were recorded in the manufacture of other transport equipment, basic metals, and motor vehicles.

New orders in surveyed industrial sectors decreased by 0.5% year-on-year at current prices. Non-domestic orders fell by 0.3%, while domestic orders declined by 0.7%. The downturn in orders was mainly attributed to the manufacture of motor vehicles, which dropped by 4.7%; chemical products, down 3.8%; and paper and paper products, which fell by 3.5%. On the positive side, new orders grew for machinery and equipment by 9.9%; fabricated metal products by 4.3%; computer, electronic and optical products by 2.6%; and other transport equipment by 6.5%.

Employment in the industrial sector also contracted. The average registered number of employees in industry during the first quarter was 2.0% lower compared to the same period last year.

The figures suggest a broadly stable industrial sector supported by energy supply and select manufacturing industries, but held back by weak automotive and related production.

Source: CSO

Construction output in Czechia rises 7.4% in first quarter of 2025

Construction activity in the Czech Republic expanded in the first quarter of 2025, with total output increasing by 7.4% year-on-year, according to newly released data. The growth was driven by both building construction and civil engineering sectors. Compared to the final quarter of 2024, construction production rose by 3.4%.

Building construction posted a 6.8% increase from the same period last year, contributing 4.9 percentage points to overall growth. Meanwhile, civil engineering construction saw a stronger rise of 9.1%, adding 2.5 percentage points.

Construction companies employing 50 or more workers secured contracts worth CZK 99.3 billion in the first quarter, marking a 15% increase year-on-year. While new building construction orders fell by 4.2% to CZK 42.1 billion, civil engineering orders climbed 34.9% to CZK 57.2 billion. The average value of newly awarded contracts rose sharply to CZK 7.9 million, up 70.9% from a year earlier.

The total value of construction projects permitted in the first quarter was CZK 115.5 billion, down 18% from the previous year. This decline was largely attributed to fewer new civil engineering projects and a high comparison base from 2024. Despite the overall decrease, approvals for non-residential buildings and transport-related constructions recorded year-on-year gains. Higher levels of planned investment were noted in Prague, the Central Bohemian Region, and the South Moravian Region.

Housing construction also showed mixed results. A total of 8,297 dwellings were started in the first quarter, a 2.9% increase year-on-year. Growth was led by a 14.9% rise in multi-unit residential projects and a notable increase in conversions of existing buildings. In contrast, new single-family home construction continued to slow, with starts falling 15.9% compared to the same period last year. Conversions of family homes and new dwellings in non-residential buildings also declined. The highest number of housing starts was reported in Prague, the Central Bohemian Region, and the South Moravian Region.

Completions fell across the board. A total of 6,642 dwellings were completed in the first quarter, representing a 17.3% year-on-year decline. All categories of residential construction posted decreases, with completions of single-family homes recording the steepest drop. Only conversions of family homes posted a slight increase. The highest numbers of completed dwellings were in the Central Bohemian Region, Prague, and the South Moravian Region.

The latest figures highlight a construction sector still balancing growth in large infrastructure and multi-family projects against ongoing challenges in the housing market, particularly for family homes.