2014 will bring the lowest volume of new retail supply to Romania in the last 10 years
The estimated level of new modern retail developments until the end of 2014 is of over 56,000 sqm that represents the lowest level recorded since 2003, reveals the latest CBRE report on Romanian the retail market. The expected volume for 2014 is significantly lower than the registered 10 years average (245,000 sqm/year).
The demand was supported by a new group of franchisees that intend to create a wide portfolio of brands in order to be present in top locations in Bucharest. This particular new demand is boosted by the good performances registered by the dominant shopping centres and shopping galleries located mainly in Bucharest.
CBRE estimate that in 2013 over 20 new entries were registered on the local market in: shopping centres (La Martina, Oliver Weber, Patrizia Pepe, BCBG Max Azria, Tchibo Store, Pretty Ballerinas, Suvari, H&M Home, Mim, Ethan Allen, Crabtree & Evelyn, Lego, Napapijri), hotel shopping galleries (Dolce&Gabbana) or high streets (Anthony Morato, Ben Sherman, Roberto Bravo, Laduree), the majority of them being operated by franchisees. Another big name was the Greek toys retailer Jumbo that has opened its first two units in Romania in autumn 2013, in Timisoara respectively Bucharest.
Luiza Moraru, Head of Retail CBRE Romania, commented: “Bucharest will still attract the majority of the new retailers on the market since at least two major schemes are expected to be delivered until 2016. The demand and the macroeconomic performances registered in 2013 coupled with positive expectations for 2014 and 2015 will lead to the strengthening of the prime shopping centres’ dominant position in Bucharest as well as in the province.”
At the end of Q4 2013 the modern shopping centre stock reached 2.81 million sqm, after the opening of five schemes that accounted for 124,000 sqm. These openings comprised of four shopping centres Uvertura Mall Botosani, AFI Palace Ploiesti, Promenada Mall Bucharest and Galati Shopping City totalling 106,000 sqm and one hypermarket-led scheme with a small gallery - Cora Constanta (total GLA of 18,000 sqm) – operational since July 2013.
The new schemes to be completed by the end of 2014 are rather small, none of the respective schemes being larger than 30,000 sqm each. These are: Vulcan Value Centre (NEPI) located in Bucharest, plus Targu Jiu Shopping Centre and the extension of AFI Palace Ploiesti. When completed at the end of Q4 2014, these schemes will increase the stock up to around 2.85 million sqm.
Construction works have started for major schemes: Mega Mall and ParkLake both located in the Eastern part of Bucharest, Immochan’s Ghencea Shopping Centre also in Bucharest and the first phase of Coresi Shopping City in Brasov. Their completions are expected in 2015 - 2016.