CEE retail sales are forecast to expand at between 4.2%-7.6% per annum in the next decade, according to a new research report published by broker Colliers International.
The report - called Exceeding Borders - Retail Market in the CEE-13 Region - identifies GDP growth, wage rises and price inflation as the main drivers.
'The base for that growth is wide: CEE-13’s demographic footprint of 160 mln inhabitants encompasses over a quarter of the population of Europe outside of Russia,' noted Mark Robinson, CEE Research Specialists at Colliers International.
He added: 'The purchasing power of these inhabitants, whilst generally low, lies in a huge range: it was just 5.9% of the European average in 2016 in Ukraine, up to 61.2% in Croatia. Of the capital cities, only Lithuania’s Vilnius (100.7%) exceeds the European average.'
Shrinking and ageing population is the key macro risk for retail demand, largely due to negative net birth rates and a steadying of emigration pressures, Colliers added.
Retail space availability highest in Poland
In terms of modern retail stock availability, Poland reports the highest volume at 11.3 mln m2 of GLA), followed by Romania (3.65 mln m2 GLA) and Czech Republic (3.45 mln m2 GLA). However, taking into the consideration the population, the highest density ratio is in Estonia (598 m2/1,000 inhabitants).
Traditional shopping centres dominate most of the analysed markets, but four markets - Czech Republic, Poland, Romania, Hungary and Slovakia - also show relatively high availability of retail park space. The largest retail parks in the CEE countries were developed by Inter IKEA Group, the most active developer in this region.
Shopping centres are concentrated in the capital cities in the majority of the analyzed countries. The exceptions are Poland and Czech Republic where the highest concentration is in regional cities (86,7% and 77.7% respectively.
