The shopping centre industry in Central and Eastern Europe is on the brink of a new era, according to Guillaume Poitrinal, CEO of Europe's largest listed property company Unibail-Rodamco. 'The investment-only phase is finished,' he said at the kick-off of a two-day conference programme at the Mapic retail fair in Cannes on Wednesday. 'The new era is all about operations and development.'
The shopping centre industry in Central and Eastern Europe is on the brink of a new era, according to Guillaume Poitrinal, CEO of Europe's largest listed property company Unibail-Rodamco. 'The investment-only phase is finished,' he said at the kick-off of a two-day conference programme at the Mapic retail fair in Cannes on Wednesday. 'The new era is all about operations and development.'
In a separate presentation, Joost Bomhoff, chief development officer at the French-Dutch combine, endorsed Poitrinal's view that the yield shift game in Central and Eastern Europe is over. 'The future is not in yield shift or capital gains,' he said, citing reports that yields of 6% to 6.5% are now being paid in Romania and Bulgaria. 'The gap between CEE and Western Europe is relatively small. We are also seeing saturation in some markets. The future lies in adding value, in finding the hidden potential of a shopping centre. That means a more management-intensive approach.'
Turning to the question of whether fast-growing European countries are the new Eldorado for shopping centres, Bomhoff said the answer for developers was mixed. 'The early movers have benefited from the yield shifts. Now they are moving to the provinces where the opportunities are smaller. To succeed there you really need to be the only one.'
Unibail-Rodamco is well-placed to move into the next phase of development in CEE, Poitrinal said, adding that the merger of Unibail and Rodamco earlier this year had created a company with 'a unique platform as an investor, operator and developer. Our vision is to become a strong niche player in European cities with more than 400,000 inhabitants. We are already the number one player in France, Spain, Scandinavia, Central and Eastern Europe and the Netherlands. Our ambition is to expand our pipeline by a third in the next five years.' He added that the company did not intend to be active in every European country. 'We must have local mass,' he said.
Unibail-Rodamco has a portfolio of EUR 24 bn throughout Europe.