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Real estate: DTZ: Romania will have 3 million sq.m. of malls this year
The stock of modern retail areas in Romania will exceed this year 3 million square meters, compared to 2.86 million sq. M. In 2013. Bucharest projects will cumulate a third of total and the empty space degree will vary between 4% and 25%, according to DTZ.
“In 2015 the stock of modern retail areas in Romania will exceed 3 million square meters while in Bucharest it will be 1 million square meters. The vacancy rate for premium retail projects will continue to drop at a slower rate than in 2014, considering that three major projects will be commissioned in the first part of the year,” said Bogdan Marcu, head of the retail department of DTZ Echinox.
In his opinion, international retailers represented in Poland, Czech Republic, Hungary and Turkey are analysing conditions and characteristics of the market in Romania, so we expect them to enter the local market by the end of the first semester. Compared to 2014, DTZ estimates that the number of new entrances will grow this year, being by 196% higher.
Modern retail areas to be completed this year exceed 220,000 sq.m. About 75% of this area will be commissioned to NEPI, which besides the completion of Mega Mall and Timisoara Shopping City intends to expand projects like City Park Mall, Severin Shopping City and Deva Shopping Center.
The most important new retail projects in 2015 are Mega Mall in Bucharest, Coresi Shopping City in Brasov and Timisoara Shopping City. At the end of 2015 the density of modern retail areas per 1,000 inhabitants will be 153 sq.m., compared to 142 sq.m. at present. In Bucharest, the density of modern retail areas per 1,000 inhabitants is of 490 sq.m.
The overall stock of modern retail areas in Romania is of 2.86 million square meters, 32% of which is registered in Bucharest. Commercial centers represent 59%, while retail parks and commercial galleries hold 25% and 16% of overall stock.
After Bucharest, most projects were built in Constanta - 157,000 sq.m, Cluja Napoca - 149,500 sq.m, Iasi - 146,000 sq.m, Pitesti - 116,000 sq.m., Ploiesti - 107,000 sq.m, Timisoara - 106,500 sq.m and Brasov - 43,500 sq.m.
The highest density of malls is recorded in Pitesti with 748 sq.m per 1,000 people, Constanta with 553sq.m/1,000 people, Ploiesti - 511 sq.m/1,000 people, Iasi- 502 sq.m./1,000 people. At the opposite pole we find Brasov with the lowest density of malls per 1,000 inhabitants - 172 sq.m., which will double after the opening of Coresi and Timisoara wity 334 sq.m.
In 2014 deliveries of new areas amounted to 75,000 sq.m., the lowest in the last ten years. About 65% of the area was in Bucharest. Three new modern retail projects were delivered, a commercial gallery - Auchan Tricodava and a retail park - Vulcan Value Center in Bucharest and a commercial center in Targu Jiu - Shopping City Targu Jiu..
The vacancy rate was dropping, both in Bucharest and in other towns, being influenced by the low rate of new developments and the retailers’ need to expand. The difference between premium and secondary retail projects continued to be a significant one. Dominant projects register a vacancy rate less than 4% both in Bucharest and regional towns, while secondary projects have a vacancy rate between 20 and 25%.
Premium rents did not register changes in 2014, being between 60 and 70 euros/sq.m./month for performing retail projects in Bucharest, while in secondary projects rent varied between 25 and 40 euros/sq.m./month. On the outskirts of the capital city, rents vary between 20 and 25 euros/sq.m./month. In Timisoara, Cluj Napoca, Iasi or Constanta premium rents are 20-30% higher.