Warsaw poised for major shopping centre growth?
Published on 18/06/2015
Poland's commercial real estate market appears poised for growth. The country's economy built momentum throughout the first quarter of 2015, with GDP rising by 3.6 per cent year on year - thanks in large part to strong consumer spending and an increase in investment.
Commercial property and real estate consultant Cushman & Wakefield (C&W) says the outlook for the market is decidedly positive. Both consumer and business confidence are expected to strengthen further, leading to greater investment and - ultimately - more retail building activity.
Warsaw presents strong opportunity for retail building
According to C&W, demand from retail occupiers is highest in the prime thoroughfares of Warsaw and other major cities. Despite this, Poland's capital has one of the lowest rates of shopping centre provision per 1,000 residents in the whole country, suggesting it is ripe for the building of new large-scale shopping centres.
In the first half of 2014, the average rate of vacancy for retail properties in Polish cities with more than 200,000 inhabitants stood at just three per cent. And with the highest rents (between $90 and $157 per sqm a month) found in Warsaw's prime shopping centres, it's clear that the city represents a significant opportunity for developers looking to build new retail space - and, in turn, for building suppliers.
Warsaw's existing shopping centre construction projects
Work is already underway on a number of shopping centre projects in the capital. Factory Ursus, the city's first outlet mall, recently reached the halfway point of a significant extension involving the development of an additional 6,000 sqm of retail space, plus a renovation to the existing parts of the facility.
Royal Wilanow, a high-class office and service building that will also contain almost 7,000 sqm of retail units, is due to be completed in August and has attracted several high-profile tenants, including Nike and Bang & Olufsen. Another new development, Galeria Lopuszanska, will offer an impressive 16,000 sqm of shopping space when it opens its doors to the public towards the end of 2015.
And that's not all. Building permits have been granted for a further five malls in Warsaw (Fabryka Wolomin, Ferio Wawer, Hala Koszyki, CEDET and Centrum Marszalkowska), while another five retail developments are also in the planning stage (Forum Bemowo, Galeria Kabaty, Galeria Wilanow, Galeria Bialoleka and Wilanow Park).
Retail opportunities available across Poland
But Warsaw isn't the only Polish city that looks set to enjoy growth in shopping centre development. The Baltic Sea port of Gdansk - home to almost half a million people - has been chosen by Multi Poland as its latest new mall location, with the ground-breaking ceremony for the Forum Gdansk taking place in early June.
When completed in 2017, the shopping centre will boast 63,000 sqm of gross leasable area on a prime spot in the heart of the city, close to the Old Town, the railway station and key municipal buildings. Once road infrastructure development work is taken into account, the project budget comes to approximately $218 million.
Tomasz Matusiak, director at Multi Poland, expressed hope that the mall will become an entertainment hub for the whole city when it opens in two years' time: "We want the residents of Gdansk to come and enjoy their free time at Forum Gdansk - whether shopping, watching a movie, eating at one of the restaurants, exercising at the gym, or visiting the Gdansk Heritage Centre.
"We hope many people will also come here just to spend time at the public square over the Radunia canal. The prestigious location in the heart of the city makes Forum Gdansk a very special project for Multi, and we are fully committed to making it a success."