By the end of 2024 the stock of modern retail spaces will overpass 4.5 mln. sq. m setting a new record for Romania. Circa 186,000 sq. m could be added to country’s modern retail stock if taking into consideration under-construction projects, according to ActMedia.eu.
The popularity of the specialized format is noticed in the forecast developments, claiming 95% of the future new supply and when looking exclusively at the under-construction units, retail park is the predominant format to be developed nationwide. Pitesti city is the recipient of the main project in the pipeline and set to be brought on the market this month, respectively Arges Mall, a 52,100 sq. m GLA (gross leasable area) concept developed by Prime Kapital.
According to the special research report Romania Retail Destinations 2024, released by CBRE Romania the leader of the real estate consultancy market, the major cities in the country surveyed by CBRE will attract approximately 185,000 sq. m in the following period in different construction or planning stages. The largest shares of new supply are located in Bucharest or in its proximity, followed by Iasi, Cluj, Brasov, and Timisoara.
Romania maintains its position as an attractive market for international retailers, with many advantages, such as: increasing purchasing power, retail spending growing rates, a constant appetite for new brands, an educated workforce, and a very low vacancy rate (below 3% on average) for the existing spaces. Looking more closely at Bucharest, home to almost a third of the modern retail stock, the country’s capital has strong purchasing power, which is now higher than Budapest – the closest CEE capital in this respect, and with cities such as Cluj-Napoca and Timisoara very close to the capital’s level. Also, in terms of vacancy rates, Bucharest remains at a very low ratio, with overall vacancy below 1.0%.
“Whether the modern stock of retail space will exceed a new perceptual threshold and it could sound impressive still it is not enough, as many international retailers are interested in entering the Romanian market, and the demand for large areas has been increasing. 2024 is another dynamic year from a commercial point of view, considering the brands that have already opened or announced their intention to open locations in Romania, names such as KIKO Milano or Happy Restaurants and more to come from sports, convenience, fashion, and beauty sectors. Romania holds the potential to attract other major international brands in the foreseeable future, and the fact that their expansion here is backed by our extensive and unique experience is always a winning formula“ explained Carmen Ravon, Head of Retail Occupiers at CBRE.
Although the eCommerce industry registers year-on-year growth, the forecasted volume for 2023 is EUR 7.0 bln. – meaning a 11% YoY increase, this segment facing its own challenges as caution is the guiding principle for buyers affected by the price changes. Companies continue to focus their business on shopping centres or retail parks, looking to opening more stores.
Romanians maintain their large appetite for fashion despite economic challenges, which puts our country on the retailers’ list that want to expand their business regionally. 9 new companies mainly from fashion and food & beverage sectors chose to enter the Romanian market in 2023, 5 of them inaugurating their first units during the last year Other four announced their intention to open a store or secured a retail space and prepare launching their business, an example in this regard being Happy Bar & Grill, that announced its first location in AFI Cotroceni.
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