A year of big retail openings lies ahead for Poland
Developers announce delivery to market of over 500,000 sqm of new retail space. This will include Galeria Północna in Warsaw. Advisory firm JLL summarizes Q1 2017 on the retail market in Poland.
“By the end of Q1 2017, total retail stock in Poland was 13.4 million sqm,” said Joanna Tomczyk, Research Analyst, JLL. “Shopping centres accounted for 9.5 million sqm, while retail parks, warehouses and outlet centres accounted for 9.5 million sqm in total. In the first three months of 2017, the market gained a mere 36,800 sqm but it is only a foretaste of what is yet to come. Provided that the plans of developers are completed as per schedule, the retail market in 2017 is likely to grow by 511,000 sqm of space, including 388,000 sqm in the shopping centre format alone.”
The projects completed in the first quarter of 2017 included extensions of Auchan Hetmańska in Białystok (+5,800 sqm) and Galeria Wnętrz City Meble in Gdańsk (+6,000 sqm), as well as the delivery of Leroy Merlin in Bełchatów and Agata Meble in Rzeszów.
“At the end of Q1 2017, approximately 591,000 sqm of the shopping centre space was at the construction stage. More than 79 percent of the upcoming stock will be located in major agglomerations. Currently, over 650,000 sqm of retail space in different formats remains under development,” said Tomczyk.
“With increasing competition, developers are focused not only on new projects but also on maintaining the attractiveness of existing ones,” said Anna Wysocka, National Director, Head of Retail Agency, JLL. “Refurbishments, extensions, improvements of retail, entertainment and restaurant propositions as well as the implementation of new technological solutions are trends that will continue in the next few years.”
Prime shopping centre rents, which refer to shop units of 100 sqm earmarked for fashion & accessories and located in the best-performing assets in a given city, remain, as always, highest in Warsaw (up to €130 / sqm / month). Levels of rents across major cities range from €45 / sqm / month to €60 / sqm / month.
Retail investment market
“In Q1 2017 the total transacted volume in Poland’s retail sector totalled approximately €135 million and was 5 percent higher than the figure for 2016. The two major transactions were: the sale of the Ogrody shopping centre in Elbląg by CBRE Global Investors to CPI Property Group – as part of a portfolio transaction comprising 11 shopping centres in CEE, as well as the sale of Suwałki Plaza by Plaza Centers to an undisclosed Hungarian fund,” said Agnieszka Kołat, National Director, Retail Investment CEE, JLL.
Prime yields for best-in-class shopping centres in Poland remain stable at 5.0 percent, and prime retail parks are expected to trade at around 7.0 percent.
Press Release by JLL.