According to the latest Shopping Centre Index survey conducted in the Czech Republic by CBRE,the world leader in commercial real estate services, the average turnover recorded by the Index increased by 7.7 percent y-o-y for the second consecutive year. Rents also rose by 0.5 percent for the first time in five years. The CBRE Shopping Center Index recorded a 3.3 percent y-o-y increase in business center attendance, while the vacancy rate in business centers fell to 4.7 percent.
The leasable retail area is dominated by fashion with 37 percent. Speciality Retail covers 15 percent of which 40 percent is taken by health & beauty tenants. The third biggest sector is Sports with 13 percent. Taking into account the overall proportion of share the changes in sectors is negligible. However considering the changes in individual sectors the highest increase is in Household & Furniture (13.5 percent y-o-y). Household & Furniture significantly grew due to a high number of alternative and new local operators on the market. Fashion and Speciality Retail led the share in terms of the number of units, together accounting for 42 percent, followed by Services. The most dynamic within the individual sectors in number of units is Household & Furniture, which increased by almost 21 percent y-o-y. Moreover there is a 5 percent increase shown in both food and sports.
Katarina Brydone, Head of Retail at CBRE added: “Turnover has grown in all sectors, with most sectors recording growth at the same level as the average Index turnover, i.e. their growth is between 7 percent and 9 percent year-on-year. The most dynamic sector was in the gastronomy sector, which managed to grow by a double digit figure of 15.4 percent year-on-year. This increase was mainly due to the results of fast food and restaurant operators. Gastronomy is a dynamic sector, which is growing at a global level and is a sector that is currently experiencing a small revolution in Prague, the capital city. We clearly see the increasing importance of this sector when looking at new projects or projects that are currently undergoing reconstruction. The owners of these centres are significantly increasing areas devoted to this sector, while we are also seeing the entry of new concepts into the market and increasing requirements for unit sizes of many concepts, especially those that provide a dining experience and overall atmosphere as well as concepts for a healthy lifestyle. We are pleased that customers are ready to expand this sector even in regional cities.”
Klára Bejblová, Head of Research & Consultancy at CBRE, said: “Excellent turnover results remained in 2016 reﬂecting the persisting positive sentiment on the Czech market, which was reflected in a slight increase in rents last year (0.5 percent). Forecasts show that the Czech economy will continue to be in good shape, so we expect the shopping centres to achieve very good results this year as well. “
In terms of footfall distribution during the year, December remains the strongest month with 10.5 percent of total visits. The average footfall is around 450,000 visitors per shopping centre. However it is the only month which shows a year-on-year decline. It is relatively small, by 0.8 percent, caused by the trading restriction on national holidays. The increase in the remaining months varies between 2 percent to 8 percent y-o-y.