Polish Business News Magazine

Business

Poles continue to shop

Poland clearly outperforms other countries of CEE region when it comes to retail trade turnover growth according to Eurostat. Nevertheless, retailers are wary and many of them have already revised their expansion plans. For the time being it remains unclear whether the worst of the current crisis is already behind us and some key issues, such as unemployment and availability of financing, could curb people’s appetites and abilities for consumption.

As a result, Polish retail landscape is reshuffling. Many retailers are going through difficult times and last months have seen some bankruptcies of prime retail groups such as Semax, Galeria Centrum and Monnari. Also, some tenants have abandoned the retail space they have occupied.

With total retail stock of 1.27 million sq m of modern retail space, Warsaw is now perceived to be a well provisioned market, but market niches persist. The city hosts a variety of retail schemes in 39 projects including shopping & leisure centres, factory outlets and retail parks. 2009 has seen only limited construction activity as developers continue to limit their current and future activity. Construction activity went nearly to the halt. The difficulties in securing external financing pose main obstacle to further sectoral expansion, despite healthy market fundamentals as the Polish capital seems particularly resistant to the current economic downturn.

However, best retail schemes, such as Arkadia, Galeria Mokotow and Zlote Tarasy remain very popular among the customers and retailers. In 2010 we expect to see further market’s diversification with the best schemes performing outstandingly and increasing their market share, while some others needing concept’s update. Although in 2009 we have witnessed a slowdown, in a short to medium term Warsaw’s retail market will re-start to expand as there is still market space for new retail developments in the city and its vicinity.