Retail market in Romania, on the rise
With the delivery of the ParkLake Plaza mall, the current stock of modern retail space in Bucharest has increased from 1.06 million sqm to 1.13 million sqm. That means the stock of shopping centers per thousand inhabitants in the metropolitan area will reach about 450 sqm. By the end of October, Bucharest is also expected to see the opening of the Veranda Mall shopping center, located in the Bucur Obor area. “The market will absorb around 200,000 sqm of leasable area in the years to come, of which the shopping centers announced for delivery in Bucharest this year add up to roughly 100,000 sqm,” said Liana Dumitru, associate director in the Retail Department of Colliers International. “Thus, we consider that besides the projects delivered this year, there is room for another large shopping center in Bucharest,” added Dumitru.
According to Colliers experts, the opening of the new commercial center, ParkLake Plaza, will put pressure on the eastern part of Bucharest, where another large shopping center, the Mega Mall, opened for business less than 18 months ago. Thus, eastern Bucharest will be covered by four shopping centers by the end of the year, namely the Mega Mall, ParkLake Plaza, Bucharest Mall and Mall Veranda.
“It is difficult to estimate the impact that the new deliveries announced this year will have on the existing projects, but certainly the mode of operation, flexibility and adaptability to consumer needs, as well as the constant communication with the consumer, will be decisive for the long-term success of each shopping center,” concluded Liana Dumitru.
Dominant shopping centers in Romania’s main cities are close to full occupancy
Romania’s modern retail stock amounts over three million sqm. Most of it is represented by shopping malls, some 57 per cent, followed by retail parks, with 35 per cent and commercial galleries, with around eight per cent. Three shopping centers were completed in the first half of 2016, with a total gross leasable area of 69,000 sqm, namely Shopping City Timișoara, Mercur Craiova and Satu Mare Shopping Plaza. Additionally, the Coresi Shopping Resort in Brașov was extended with a leasable shopping space of 14,000 sqm.
The modern retail space density per 1,000 inhabitants in Romania is 164 sqm. Bucharest, with a retail stock of over one million sqm, currently has around 600 sqm of modern retail space per 1,000 inhabitants.
In the second half of 2016, some 148,000 sqm of new retail spaces are scheduled for completion, with 65 per cent being located in Bucharest.
Fashion retailers will continue to expand their networks, mostly by opening stores in shopping centers. In the hypermarket segment, Carrefour will be the most active retailer, with three openings planned. By the end of the year, Carrefour’s hypermarket chain will reach 32 units in Romania. Growing wages, low inflation, falling interest rates and improving labor market conditions are all expected to continue having a positive impact on the retail property sector, according to DTZ Echinox experts.
“In the second half of 2016, around 148,000 sqm of commercial space is scheduled to be finalized, 65 per cent of it being located in Bucharest. In other cities, the most important deliveries are Shopping City Piatra Neamt and the extension of the City Park Constanta. Considering that no significant deliveries of modern retail spaces are scheduled for 2017, and that retailers are reporting significant growths in sales, we expect the level of rents to maintain its upward trend, as it did in 2016,” explained Bogdan Marcu, partner - Retail Agency, DTZ Echinox.
Therefore, the prime rent level has increased slightly. This year, headline rents achieved for units of 100 sqm in prime shopping centers in Bucharest range between 65 to 75 Euro per sqm per month, while for secondary shopping centers the headline rents for units of same size are between 25 and 45 Euro per sqm per month. Headline rents achieved for units of 100 sqm in dominant shopping centers outside Bucharest range on average between 22 – 27 Euro per sqm per month. In cities such Cluj-Napoca, Timisoara, Iasi or Constanta, the prime headline rents are higher by 20 to 30 per cent.
Overall, investments in the Romanian retail market reached 170 million Euro in the second quarter of the year. A key deal was the purchase of the Sibiu Shopping City by NEPI, which acquired the scheme from the Argo Group for 100 million Euro, according to Cushman & Wakefield experts.
According to Colliers experts, the opening of the new commercial center, ParkLake Plaza, will put pressure on the eastern part of Bucharest, where another large shopping center, the Mega Mall, opened for business less than 18 months ago. Thus, eastern Bucharest will be covered by four shopping centers by the end of the year, namely the Mega Mall, ParkLake Plaza, Bucharest Mall and Mall Veranda.
“It is difficult to estimate the impact that the new deliveries announced this year will have on the existing projects, but certainly the mode of operation, flexibility and adaptability to consumer needs, as well as the constant communication with the consumer, will be decisive for the long-term success of each shopping center,” concluded Liana Dumitru.
Dominant shopping centers in Romania’s main cities are close to full occupancy
Romania’s modern retail stock amounts over three million sqm. Most of it is represented by shopping malls, some 57 per cent, followed by retail parks, with 35 per cent and commercial galleries, with around eight per cent. Three shopping centers were completed in the first half of 2016, with a total gross leasable area of 69,000 sqm, namely Shopping City Timișoara, Mercur Craiova and Satu Mare Shopping Plaza. Additionally, the Coresi Shopping Resort in Brașov was extended with a leasable shopping space of 14,000 sqm.
The modern retail space density per 1,000 inhabitants in Romania is 164 sqm. Bucharest, with a retail stock of over one million sqm, currently has around 600 sqm of modern retail space per 1,000 inhabitants.
In the second half of 2016, some 148,000 sqm of new retail spaces are scheduled for completion, with 65 per cent being located in Bucharest.
Fashion retailers will continue to expand their networks, mostly by opening stores in shopping centers. In the hypermarket segment, Carrefour will be the most active retailer, with three openings planned. By the end of the year, Carrefour’s hypermarket chain will reach 32 units in Romania. Growing wages, low inflation, falling interest rates and improving labor market conditions are all expected to continue having a positive impact on the retail property sector, according to DTZ Echinox experts.
“In the second half of 2016, around 148,000 sqm of commercial space is scheduled to be finalized, 65 per cent of it being located in Bucharest. In other cities, the most important deliveries are Shopping City Piatra Neamt and the extension of the City Park Constanta. Considering that no significant deliveries of modern retail spaces are scheduled for 2017, and that retailers are reporting significant growths in sales, we expect the level of rents to maintain its upward trend, as it did in 2016,” explained Bogdan Marcu, partner - Retail Agency, DTZ Echinox.
Therefore, the prime rent level has increased slightly. This year, headline rents achieved for units of 100 sqm in prime shopping centers in Bucharest range between 65 to 75 Euro per sqm per month, while for secondary shopping centers the headline rents for units of same size are between 25 and 45 Euro per sqm per month. Headline rents achieved for units of 100 sqm in dominant shopping centers outside Bucharest range on average between 22 – 27 Euro per sqm per month. In cities such Cluj-Napoca, Timisoara, Iasi or Constanta, the prime headline rents are higher by 20 to 30 per cent.
Overall, investments in the Romanian retail market reached 170 million Euro in the second quarter of the year. A key deal was the purchase of the Sibiu Shopping City by NEPI, which acquired the scheme from the Argo Group for 100 million Euro, according to Cushman & Wakefield experts.
The editorial is also available in our print edition.
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