Polish retail market: half a million square metres under construction amid falling vacancy rates

Although 43,000 sq m was added to the market in the third quarter through new openings, closures accounted for as much as 62,000 sq m. It is worth emphasising, however, that approximately 144,000 sq m came on stream in the first half of the year, somewhat offsetting the negative result for supply for the third quarter which was largely due to the closure of the 54,000 sq m Galeria Malta shopping centre in Poznań,

comments Ewa Derlatka-Chilewicz, Head of Research, Cushman & Wakefield.

Poland’s total retail stock currently stands at around 16 million sq m. The outlook for the fourth quarter looks promising as approximately 200,000 sq m of retail space is expected to open in the final months of the year. A total of 500,000 sq m is under construction, with retail parks accounting for 77% of the development pipeline,

adds Ewa Derlatka-Chilewicz.

The average footfall for shopping centres and retail parks during the summer holiday period was 463,000 customers per retail scheme in July and 478,000 in August, up by 4.5% and 6.3% year-on-year respectively. Broken down by size, the outperformers were the largest shopping centres with over 60,000 sq m of GLA and large ones (40,000-60,000 sqm), which saw their footfall levels grow by 8.2% and 7.3% year-on-year respectively,

comments Ewelina Staruch, Analyst, Cushman & Wakefield.

Unfortunately, real retail turnover - taking account of inflation - was down year-on-year by 4.3% in July and 1.6% in August. However, due to falling inflation rates, the declines in real turnover were not as deep as in previous months,

adds Ewelina Staruch.

The highest rise in rental rates of around 17% year-on-year was reported for retail parks. The downturn in the consumer market and lower real turnover levels experienced by tenants are the main drivers behind the downward pressure on non-prime rents,

says Paulina Bauer, Head of Retail Asset Services, Cushman & Wakefield.