Green financing of commercial real estate in Poland

Banks operating in the Polish commercial real estate market have, in large part, embedded the principles of sustainable finance into their lending practices. Many are now actively developing and refining internal ESG assessment frameworks. 

They are typically based on three key EU standards: (i) the EU Taxonomy; (ii) the Sustainable Finance Disclosure Regulation (SFDR); and (iii) the Corporate Sustainability Reporting Directive (CSRD).

Green loan principles

A growing number of loans provided by banks in Poland’s commercial real estate sector are now classified as “green”.

The “green loan” is an instrument used exclusively to finance or re-finance eligible green projects, while also meeting the four core tenets of the Green Loan Principles (GLP) developed by the Loan Market Association (LMA): 

1. Use of proceeds: A green loan must be used for a “green project”, with its purpose appropriately described in the loan documentation; 
2. Project evaluation and selection: The borrower has a process for determining how the project fits within the categories set out in the GLP, and which eligibility criteria are applied;
3. Management of proceeds: Proceeds of the green loan shall be credited to a dedicated account or otherwise tracked by the borrower in an appropriate manner; and
4. Reporting: Regular, up-to-date information on the use of proceeds will be provided to the lender.

Green factors

Although the number of green loans provided by banks is rising, most financing transactions in Poland tend to focus on green aspects primarily within banks’ internal credit approval processes. In many cases, lenders rely on internal criteria confirming the property meets certain environmental standards. However, formal documentation aligning with recognised green loan standards is not always included in the finance documentation, or is partially implemented to an extent depending on the bank’s internal policies. 

Beyond green loans, other ESG factors increasingly shape the approach of banks to financing commercial real estate. Some now treat BREEAM certification (with a rating of “outstanding” or “excellent”) as a standard requirement for funding new projects or confirming a building meets green criteria. 

Another practical implication of banks’ ESG-driven approach to real estate finance is the requirement to implement energy efficiency improvements, ensuring properties intended for letting comply with minimum energy performance standards. 

Banks and other financial institutions face an increasing number of obligations related to environmental financial risk management and sustainability-linked disclosures. As a result, new reporting obligations are being passed on to borrowers through finance documentation reflecting the need for lenders to collect substantial amounts of ESG data to assess the ESG performance of the financed assets. 

Summary

Green financing in Poland is no longer an alternative – it is becoming a permanent feature of the market. Banks and investors are increasingly evaluating projects against ESG criteria and recognise that green finance will play a leading role in the future. 

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Katarzyna is a rarity among lawyers in that she uniquely connects transactional real estate work with banking and finance. With a career shaped in international legal environments, Katarzyna brings precision, commercial awareness, and cross-border fluency to every deal.