Elena Stryukova: ‘Vacancy rate in shopping malls has increased to 15%’

Commercial real estate: market indicators

• The total supply in the shopping centers* segment is 1.13 million square metres.

• The vacancy rate is 15%.

• 12 new stores have been opened.

The replacement of international operators is being completed in Kazan shopping centres, which has led to the rotation of current tenants and the updating of concepts of existing stores. This is due to the changing needs and preferences of consumers, as well as the emergence of new players in the market.

The vacancy rate in high-quality facilities increased by 1 point and amounted to 15% at the end of the first quarter of 2024. The pace of new store openings in the first quarter is traditionally significantly lower than at the end of the year: 12 new openings, compared to 27 in the fourth quarter of 2023.

Attendance

After a critical drop in shopping mall traffic in the summer of 2020, the indicator continues to steadily recover. However, there is no return to the 2019 figures yet. In the first quarter of 2024, attendance showed an increase of 7 points compared to the same indicator in 2023. In comparison with 2019, the drop in attendance is 25%.

Opening new stores improves traffic figures. However, online sales are taking their toll. Visiting a shopping centre is now perceived as going out for something necessary, spending time with children, organising joint leisure activities, going to the cinema.

News on retail real estate market

• The opening of the FUN DAY store in Mega shopping centre on the space previously occupied by Inditex brands.

• The NEW YORKER brand is going to open in the third quarter of 2024 in the premises of H&M in the Yuzhny shopping centre.

• In the first quarter of 2024, it became known about a major deal between Megamarket and Gazprombank, the new owner of Mega shopping centres.. The marketplace plans to lease the entire free space of IKEA stores in 11 regions of Russia. A warehouse store is going to open in Kazan by the end of this year.

• Gloria Jeans plans to renovate its regional stores as part of a new concept, increasing their space. Besides, this operator announced the opening of 50-100 stores of the new Ready! Steady! Go! brand.

• O'STIN has announced the launch of a new youth clothing brand, Face Code — the opening of the first 10 stores is scheduled for 2024.

• The women's clothing brand SAVAGE plans to expand its partner retail chain to 30 stores.

• The German brand Bulmer intends to open about 30 new clothing stores in 2024.

• Melon Fashion Group has applied for registration of the trademark Love Republic Beauty, under which it plans to produce care and decorative cosmetics.

• Zolla is launching the new Nice&Easy brand. The stores are scheduled to open this year.

Market outlook

• Retailers who pay attention to the development of their business and the adaptation of formats to changing market conditions can compete more successfully and gain the trust of consumers. Thus, a number of federal trading companies are creating special mini-formats of their stores to open in regional shopping centres. Such retailers will receive advantages due to the large coverage of the country's territory.

• The fastest growing retailers in the regional market in the first quarter were Gloria Jeans, Melon Fashion Group, and Lime brands.

• The share of Russian players in the structure of tenants of shopping centres will continue to grow. Due to the gradual increase in rental rates, the rotation of current tenants and the renewal of store concepts opened 5-10 years ago will continue.

• The share of wellness tenants in shopping centres will continue to grow. Termoland, DDX, Spirit and other operators of thermal complexes and budget fitness are happy to consider offers to rent premises as part of shopping centres.

*Shopping malls with a total area of over 3 thousand square metres.