After a period of increased activity among developers in the medium-sized and smaller towns and cities, we are now witnessing the construction of new retail schemes in each of the major Polish agglomerations, observes Colliers International in the report “Return of the big cities”. The total planned new supply will reach the level of 980,000 sqm GLA by 2017.
Colliers notes that the largest amount of space delivered to the market will be in Warsaw where no full-scale retail schemes have been delivered to the market in the last 7 years. But still the Warsaw agglomeration is the largest and the most competitive retail market in Poland. The total stock amounts to 1.4 million sqm GLA in 43 schemes.
“Within the next three years, the deficit in good quality space for lease will be satisfied by new retail investments totalling 400,000 sqm GLA,” said Marta Machus-Burek, Director, Retail Strategies & Development Advisory Services in Colliers International.
The second largest retail market in Poland is the Upper Silesia. In this region there are 41 shopping centres, totalling 1.1 million sqm. Developers’ interest in the region is still high. Currently, further schemes are being built including Supersam in Katowice, Galeria Galena in Jaworzno and Marcredo Center in Piekary Śląskie. Gemini Park Tychy is one of the projects at an advanced level of planning. Colliers points out that Upper Silesia is a quite dispersed retail market with two centres (Katowice and Gliwice) with a significant amount of space located in both. Currently, developers’ activity is focused on smaller urban centres.
What happens in other cities? The retail stock in the Kraków agglomeration amounts to 550,000 sqm GLA in 15 schemes. The main pipeline project in Kraków planned to be completed in the next three years is the Serenada shopping centre. Colliers expects that in the coming years an increase in modern retail space will be noticed due to extensions and modernizations of existing schemes that are in stabilised locations.
The Łódź agglomeration, the fifth urban centre in Poland in terms of size, is a retail market with over 500,000 sqm GLA (14 shopping centres). Due to the fact that within the last four years no new shopping centres have been delivered to the market, the vacancy rate is declining and currently stands at 2.8 percent. Two projects – Sukcesja, which is due to open in spring 2015, and the small convenience shopping centre Vis à Vis – are currently under construction in the city.
There are about 600,000 sqm GLA in the Wrocław agglomeration within 18 shopping centres. “Even though there is a relatively high density ratio of modern retail space in Wrocław, there are still many interested investors who believe that the potential of purchasing power of residents has increased enough for space to be absorbed by tenants,” pointed out Marta Machus-Burek. She adds that in a competitive market the key to success is a good location. Park Handlowy Bielany, Magnolia Park and a planned new investment at a bus station, all of which have a stabilised position in the market, are being extended now.
Another interesting city is Poznań where modern retail stock totals 612,000 sqm GLA within 18 projects. Three shopping centres are currently under construction in the city, led by Posnania with 100,000 sqm GLA. In the next three years, an additional 34,000 sqm GLA of retail space could be developed in the city in the Metropolis project. Colliers points out that the Poznań retail market is becoming a tenants’ market where retail chains will have wide range of choices in terms of space and negotiating beneficial lease conditions.
On the other hand the total stock in Tricity amounts to 692,000 sqm GLA in 25 schemes. The vacancy rate in Tricity is stable and at the end of 2013 stood at 3.2 percent. Of great interest for tenants was the commercialisation process of Forum Radunia in Gdańsk near the Main Railway Station. A mix-use project, Galeria Metropolia (22,000 sqm GLA) in Gdansk Wrzeszcz, is under construction and is due to open in 2015/2016.
