Shopping centers of Ukraine. Figures, facts, trends
The development of modern technologies, the reduction of recreation areas in cities, the instability of the economy and a number of other factors significantly affect the positioning and development of Shopping Centers in our country. Let’s try to understand the situation on the Ukrainian market and the trends moving forward this sector of commercial real estate.
According to the Association of Retailers of Ukraine in the regional centers of our country there are 119 malls and shopping centers, a total area of more than 10 thousand square meters. of which 39 shopping centers and 80 shopping and entertainment centers. The total lease area of such property is 3.2 million square meters, of which almost 3 million are new or reconstructed objects in the last 15 years.
According to the State Statistics Committee, over the past two years there has been an increase in retail turnover, which indicates the restoration of purchasing power
Also after the collapse of the hryvnia, the minimum wage in dollar terms reached the indicators of 2013. In general, there is a steady increase in average wages across Ukraine, which undoubtedly also positively affects the purchasing power.
With some improvement in consumer sentiment, the retail market came to life. The demand for quality retail space has increased. In 2018 there is a significant reduction in the vacancy rate in shopping malls. According to Jll, in the 1st quarter of 2018 the vacancy rate of the shopping center was 4.5%.
Another factor affecting vacancy rates is the lack of entry of new shopping centers in 2017. Significantly did not affect the situation in the 1st quarter of 2018, during this period 34 000 sq.m. shopping areas in Kiev. In March of this year, the first phase of the Rive Gauche shopping and entertainment center opened with an area of 22,000 sq.m. and Retail Park Petrovka with an area of 12 000 sq.m. In the second quarter, the Smart Plaza Polytech has been put into operation with an area of 15 000 sq.m. Also by the end of the year it is planned to open 62,000 sq. M. in the Mall of River Mall. Despite this, JLL predicts a further slight drop in vacancy rates.
In many respects due to the above reasons, in Ukraine there is an increase in rental rates in the shopping center. In the 1st quarter of 2018 this figure was 6% and about $ 1000 per year in monetary terms.
Experts argue that in retail, the future is behind omnicannosti. The right combination of offline and online sales is the main trend and the key to success. Buyers are increasingly asking themselves where to make purchases quickly and conveniently. Shopping centers also become a playground for leisure, walks, entertainment, meetings with friends. Shopping ceases to be the sole purpose of visiting shopping centers.
Zones of “socialization“. It is important that the space of the mall is much more than rented space. To date, this ratio varies between 70/30. For example, 10 years ago the ratio was 85/15. In the west, some malls are already built with a proportion of 50/50. Creation of lounge zones, Shared space, comfortable recreation areas, including using the adjacent territories becomes an important world trend.
Multifunctionality. Getting new experience is what buyers want. The opportunity to use the space for concerts, seasonal fairs, re-equipment of bowling alleys, skating rinks, rollerdromes, all this becomes a necessity.
Logistics and omniscience. The share of e-commerce in different countries in 2017 varies from 7% to 15%, while its growth by 2025 is estimated at 40%. In order not to stay out of this trend, it is worthwhile to consider the placement of pickup points, pick up in stores, other forms of receipt of the ordered online goods within the shopping center. Accordingly, for fast delivery and efficient logistics, it is necessary to organize warehouses in close proximity to the shopping mall.
Personalized offers. Modern conditions dictate the need to create personalized offers for buyers not only from retailers but also from the mall. This requires data collected in real time. Applications geolocation-related, beacon services, will help build a chain of relationships with the client.
In conclusion, we note that despite the reduction in vacancies and higher rental rates, experts note that the situation on the market remains difficult. Some operators operate with minimal profitability, and further increases in rates can force them to close their representations. Retailers are eagerly awaiting the opening of new high-quality retail space with the advent of which, the situation on the market can drastically change.