CBRE real estate consultancy company has announced the conclusions regarding the development of the retail sector in the first half (H1) of 2018. According to CBRE’s representatives, 367,000 m2 are currently under construction with delivery dates in 2018 and 2019. There are 19 of such retail projects, out of which 13 new and 6 extensions. In H1 2018, retail spaces totalling around 30,000 m2 were delivered in projects located in Bistrița, Focșani, Gheorghieni, Râmnicu Sărat, and Vaslui. The modern retail stock is 3.52 million square meters, out of which 59% are shopping centres and 41% retail parks. Over half of number of projects are developed between 1999 and 2008.
The modern retail stock comprise 32% projects located in Bucharest, and other 38% located in 10 different cities: Constanța, Cluj-Napoca, Iași, Timișoara, Oradea, Brașov, Ploiești, Suceava, Craiova, Pitești. Out of the 19 retail projects currently under construction, the largest in terms of leasable area:
- Openville in Timișoara, with 47,000 m2 GLA;
- AFI Palace Brașov, 45,000 m2GLA;
- Târgoviște Mall, 33,000 m2 GLA;
- Shopping City Târgu Mureș, 32,900 m2 GLA;
- Shopping City Satu Mare, 28,700 m2 GLA;
- DN1 Balotești (Ilfov), 28,000 m2 GLA;
- Baia Mare Value Center, 22,500 m2 GLA;
- Electroputere Parc in Craiova, 22,100 m2
53% of the projects currently under construction is represented by the shopping centre sector, and 47% by the retail parks sector. 18% of all the retail projects that are developed now is represented by extensions.
“The retail activity continues to be dynamic in 2018 too, but not at the same pace as it was in 2017. We see a growth in the regional activity, in secondary and tertiary cities. This is due to the increase of the purchasing power across the country. Another important trend is the growth of the online component on the retail sector. Thus, we have observed a 30% increase of the online sales in H1 2018, in comparison with H1 2017”, stated Carmen Ravon, Head of Retail Leasing of CBRE Romania.
In H1 2018, nine new tenants have entered the market, most of them for the first time: Kik, the German retailer; the German brand Hugo Boss; Esquires Coffee, the Canadian coffee shop chain; the Romanian footwear brand S-Karp; the only mono brand shop opened in Eastern Europe by the Swiss watch brand TAG Heuer; the fashion retailer Comma international; Karaca, retailer of household products from Turkey; Miniso, a Japanese retailer of home and accessories products, and the Slovenian home, sports and travel products retailer, Vitapur Home.
“The increase of the consumption naturally boosted the retail spaces market. Major international brands from various industries and targeting different audiences decided to enter the local market in 2018. This is a sign that the Romanian market is maturing, and is becoming more attractive for important players in the industry that were previously reluctant to invest here”, explained Carmen Ravon.
The prime shopping centres rent (the average rent for class A projects, located in the best areas) was 80 euro/ m2, and 8 – 15 euro/ m2 for retail parks in H1 2018. The prime rent for high street retail units was 55 euro/m2. The prime shopping centres yield (the yield registered by class A projects situated in best areas) was 6.5%.