Around 190,000 sqm of shopping centres to be delivered in Romania in 2019
CBRE released the second edition of the report that measures the local shopping centres’ performance. The national shopping centres stock reached circa 2.1 million sqm, out of which 38 percent is located in Bucharest, while the remaining 62 percent can be found nationwide. In 2019, approximately 190,000 sqm of shopping centres are expected to be delivered on the retail market, out of which 18 percent are extensions of existing shopping centres, this being one of the biggest trends. The demand is on the rise, and the top performing shopping centres located in Bucharest as well as in the regional cities are fully occupied and have in place waiting lists, for those who did not find any free spaces to lease.
Carmen Ravon, Head of Retail leasing of CBRE Romania, commented: “The shopping centre sector had a dynamic year and grew in comparison with 2017. In 2018, the Romanian retail market welcomed 24 new entries, out of which 79 percent chose to open their premises in shopping centres. The shopping centres remain the traditional retail format preferred by both tenants and customers, even though we are witnessing a strong growth of e-commerce. While online commerce has boomed, shopping centres have diversified and refined their offerings, investing in creating a friendly atmosphere, increasing the number of leisure spaces and services, and increasing the alternatives for families, or facilitating parking access. The stores extended their leased areas, in order to have more exposure for their concepts and new collections, and thus supporting the online sales. An increase of the performance indicators such as footfall and the average basket has been observed, which confirms that shopping centres remain the consumers' favourite places, whether they come here to eat in the food court areas, to buy clothing or to relax."
The shopping centres monitored by CBRE are situated in Bucharest and regional cities, and registered a 3.2 percent increase in the number of customers, measured year-on-year. The average basket also grew by 2.3 percent, but it's measurement does not capture real average spending volume per actual transaction, but by taking into consideration the footfall, or the number of persons that walk through the commercial centre in the analysed period. Hence, CBRE’s report monitors changes in trends rather than actual spending levels.
When monitoring the footfall’s fluctuation month-on-month, September was the period showing the largest year-on-year increase. The strongest month remained December, when the footfall increased by 3.6 percent in comparison with the rest of the year.
Depending on their sizes, the analysed shopping centres were classified as: small traditional shopping centres with a total leasable area ranging between 5,000 sqm and 19,999 sqm that represent 34 percent of the total number of analysed shopping centres; medium traditional, ranging between 20,000 sqm GLA and 39,999 sqm GLA, that have a 33 percent share, and large traditional with sized comprised between 40,000 - 79,999 sq m GLA, and representing 33% of all the analysed shopping centres. According to the report’s findings, the top three leading segments in what concerns the leased surface are occupying more than 50% of the leasable area in the analysed shopping centres. These segments are Fashion (about 30 percent of the total area of a shopping center).
Food (20 percent) and Leisure (10 percent). The highest number of units have sizes under 50 sqm and count for 34 percent of all the stores located in the analysed shopping centres. They are closely followed by units with sizes between 50 – 100 sqm that represent 26 percent from all the tenants. The big stores, with surfaces ranging from 200 sqm to maximum 500 sqm consist in 11 percent. The largest stores cover surfaces of over 1,000 sqm and count for 6 percent of the analysed area.
The positive evolution of the shopping centers market is also reflected in the achieved turnovers. Thus, the total average figure is €10 million per annum, reflecting an increase of 5.5 percent year on year. The established retail schemes registered a slight increase in terms of revenue, while regional projects had mild setbacks, and one of the causes may be the growth of e-commerce sales. The average rent in the analysed shopping centres was estimated at €27 sqm/month. When estimating average rents, the report did not take into account the supermarkets, hypermarkets, DIY stores, bowling alleys and cinemas, in order to provide a transparent and highly comparable analysis.
CBRE’s report makes an exhaustive analysis of the shopping centers market in Romania and is drafted by the company’s Research Department, coordinated by Daniela Boca. This is the second edition dedicated to the Romanian market. Thereby, CBRE created a tool for establishing and measuring the performance of shopping centers in different regions and comparing it with the international standards. Due to the increasing popularity of this report, CBRE has decided to expand it to other markets, such as Romania, Poland, Slovakia, Italy and Spain, and the number of countries will grow in the future.