CEE retail markets in restructure and recovery mode: JLL

The five Central and Eastern European economies have been far from immune to the effects of the economic crisis, but they are expected to grow and gather momentum from 2010 onwards, according to the report 'CEE Retail in 3D' published by Jones Lang LaSalle at Mapic in Cannes.

The report looks into the effects of the economic crisis and how investors, developers and retailers are planning both their current and future activities in Poland, the Czech Republic, Slovakia, Hungary and Romania (CEE5).

The report says mid-term economic forecasts suggest that the CEE5 countries will grow at a higher rate than Western Europe. Although retail sales in the CEE5 may be dropping on average, the situation in markets such as Poland and Romania is still relatively healthy. The stability of local currencies against the euro (with the exception of Slovakia which adopted the currency on 1 January 2009) will continue to play an important role in the operation of retail networks.

Some retailers are taking painful measures to survive as the crisis affects their entire networks across Europe, JLL said. In some cases this has meant closure of stores, or, at the worst, bankruptcy. On the other hand, it has also created unexpected opportunities for retailers actively pursuing expansion, which are able to take the vacated units in otherwise difficult to obtain centres, according to the report.

Beatrice Mouton, director of Retail Leasing and Consulting for Jones Lang LaSalle in CEE, commented: 'It is undoubtedly a difficult period for many in retail, however, the CEE5 markets have come a long way already and we believe still have a good future ahead. The CEE5 customer is increasingly sophisticated and craves access to brands and goods, which Western European customers are enjoying in their respective markets. Therefore, the CEE5 markets offer growth in the medium to long term and remain attractive markets to both national and international brands.'