Occupier caution blunts upturn in mall development: C&W

Market jitters among retailers and developers threaten to hinder an anticipated upturn in shopping centre development, Cushman & Wakefield has warned.

In its latest European shopping centre report, the property adviser says 2.4 million m² of new space was completed in Europe during the first half of 2012. An additional 3.5 million m² is scheduled for completion in H2 bringing projected total completions for 2012 to 6.9 million m2, compared to 6.5 million m² last year.

'The programme of shopping centre openings and pipeline across Europe is positive compared to 2011 with the particular focus on schemes coming forward being in central and eastern Europe and Turkey being one of the stand out markets,' Justin Taylor, UK CEO Retail & Leisure said. 'Developers do, however, remain cautious with access to capital for some being more difficult. For many markets, the occupier profile is positive as many of the leading brands continue to internationalise and look to expand into major cities across Europe.'

The report notes a more cautious mood among both developers and occupiers, with delays reported in places as diverse as Italy, France, Portugal, the Czech Republic and Romania. There is also a clear geographic division in activity. Of the 71 new shopping centres opening in H1 2012, 53 were in Central & Eastern Europe and 18 in Western Europe.

The largest centre delivered in H1 was Oz mall in Krasnodar. Russia (169,000 m2) tops the European ranking in terms of both pipeline and H1 completions. The market accounts for more than one fifth of the European pipeline with a further 2.1 million m² of new space scheduled for completion in H2 2012/13.