Changing consumer behaviours reshape the retail landscape

Retail has had to reinvent itself at least several times over the last few years. The expansion of retail parks, the pandemic, the boom for online shopping, the strong customer demand for Home & Deco and DIY products, as well as the rise of the eco-trend have fundamentally reshaped the business strategies of many retail tenants, developers and landlords. And in the current environment of high inflation and mortgage costs and falling sales of flats, they can hardly pause to take a breath. This is yet another incentive to adapt to the challenging reality,

explains Ewa Derkatka-Chilewicz, Associate Director, Consulting & Research, Cushman & Wakefield.

The squeeze on consumer spending is leading to the polarization of shopping behaviour, with brands targeting the less affluent becoming increasingly popular. This, in turn, is driving the growth of value retailers such as Action, Dealz, TEDi or Pepco, further accelerated by the expansion of retail parks. On the other hand, consumers purchasing premium products continue to spend big, reflected in retail space take-up,

comments Ewa Derkatka-Chilewicz.

Paradoxically, economic woes are likely to trigger the ‘lipstick effect’, with a rise in demand for high-end cosmetics or fashion accessories. What is behind this phenomenon is the desire to demonstrate your high standard of living and the fact that products within your reach, for instance cosmetics, can be relatively easily used as a coping strategy to cheer yourself up,

adds Ada Budynek, Leasing Team Manager, Cushman & Wakefield.

In addition, Złote Tarasy also saw Guess renew it lease, Levi’s relocate to a larger unit and Local Heroes open a new store in the retail complex, while Rossmann chose Złote Tarasy for its new flagship concept,

says Anna Oberc-Krzycka, Leasing Team Manager, Cushman & Wakefield.

We have also seen substantial occupier activity in Galeria Bawełnianka in Bełchatów, for which we act as a leasing agent. Lease deals for retail space there have been recently signed by Carry, Dealz, Świat Książki, Apart, Vision Express, Media Expert and Hebe. Galeria Bawełnianka, which is scheduled to open on 26 April, will also be anchored by such retailers as LPP’s brands, CCC, Half Price, Tedi, Rossmann, Biedronka, Pepco, as well as American Bistro and many other restaurants. Meanwhile, LEGO, one of the world’s most iconic brands, signed leases for three more stores in Poland last year – in Posnania, Manufaktura in Łódź and Forum Gdansk. Our client currently operates six stores across Poland,

comments Ada Budynek.

The collapse in the housing market is likely to result in short-term fluctuations in retail sales reported by DIY retailers, albeit this is not expected to impact the long-term plans for growth and expansion of key market players. For example, a couple of days ago Black Red White opened another store in Poland – in Homepark Janki, where Dekoria established its presence in October last year,

says Michał Masztakowski, Leasing Team Manager, Cushman & Wakefield.

This is confirmation that retailers continue to search for land for stores in smaller cities which are benefiting from the rapidly growing retail park segment. In addition, retailers are also expanding into homeware segments to broaden their retail offer,

adds Michał Masztakowski.

Alongside value brands, stores selling second-hand fashion appear to be a promising direction in building a tenant-mix. No wonder, Polish consumers are becoming increasingly savvy and want to buy sustainably. This has been recognized by market-leading brands such as Levi’s and COS, which are opening stores with pre-owned fashion. Looking ahead, sustainable strategies are expected to be reflected in every aspect of operating a shopping centre,

concludes Ada Budynek.