Foreign brands continue to set up shop in the Polish retail market, which is being expanded by a wave of new scheme openings.
New brand entrants in the third quarter include UK toy seller Hamleys and Zarina and Love Republic, part of Russia's Melon Group.
The arrival of the new brands coincides with the creation of new schemes across Poland.
New openings
Total retail stock in Poland was 13.5 million m2 at the end of September 2017, including 9.6 million m2 of shopping centres. In Q3 2017, the market grew by 145,000 m2, including 134,000 m2 in shopping centres.
The biggest projects delivered to market in the past quarter include Galeria Pólnocna in Warsaw, the first phase (IKEA store) of the Skende shopping centre in Lublin, and the Vivo! shopping centre in Krosno.
'According to analyses conducted by JLL, there was 590,000 m2 of retail space under development by the end of Q3 2017 in the shopping centre format alone with delivery to market scheduled for 2017-2019. In Q4 2017, the shopping centre market is likely to grow by an additional 193,000 m2,' said Joanna Tomczyk, research analyst at JLL.
The main factor that drives the development of the retail market is not the amount, but the quality of space on offer. 'A common development pattern for older shopping centres is to remodel, extend, rebuild or change the functionality of existing projects into, for example, outlet centres,' said Edyta Potera, national director, retail agency at JLL.
Mixed-use projects are on the increase, mostly in Warsaw. Examples include EC Powisle, CEDET, Browary Warszawskie, Centrum Marszalkowska and Koneser in Warsaw as well as Monopolis in Lódz”
The Food & Beverage sector is growing in importance. Up to 12.5% of leasable space found within shopping centres throughout major Polish cities is occupied by restaurant units. This share is likely to grow even further as a response to the changing needs and preferences of consumers, according to JLL.
Demand
Poland continues to be an attractive market for foreign brands, due to its considerable size and the increasing purchasing power of its inhabitants.
A number of new brands entered the Polish market in Q3 2017 many of which have launched their stores in Warsaw, including Hamleys, which opened its first store in the Galeria Pólnocna shopping centre.
Other notable market entrants are Russian fashion brands from the Melon Group – Zarina and Love Republic – which both opened their first stores in Galeria Pólnocna. KappAhl also opened the first independent store of Newbie, a baby clothes shop, at the centre.
In August 2017, Victoria’s Secret opened its first full-assortment store in the Arkadia shopping centre in Warsaw. Nissa opened its store in the same shopping centre in September.
Rents
Prime shopping centre rents, which refer to shop units of circa 100 m2, earmarked for fashion & accessories and located in the best-performing assets in a given city, are as usual at their highest in Warsaw (up to €130/ m2/ month). The levels of rents across major cities remained relatively stable compared to previous quarters, ranging from €45/ m2 / month to €60/ m2/ month.
