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Polish retail market is still very much alive

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Global real estate services firm Cushman & Wakefield presents a summary of the first half of 2019 on the Polish retail market. 

  • More than 230,000 sq m was added to Poland’s retail stock in H1 2019
  • The highlight of H1 2019 was the opening of Galeria Młociny (78,500 sq m) in Warsaw
  • Five new global brands entered the Polish market with several others preparing for openings
  • Focus on smaller cities – 40% of this year’s new supply is expected to be delivered in towns with populations below 200,000
  • Growing popularity of mobile shopping among Polish consumers – Mastercard’s research has revealed that one in ten internet users who took part in the survey shopped via smartphone only and every fifth respondent reached for mobile devices to shop more than once a week, the highest rates in Europe

More than 230,000 sq m was added to Poland’s total retail stock across all formats in the first half of 2019; half of that total was delivered through new openings and extensions of existing shopping centres. The opening of Galeria Młociny (78,500 sq m) in Warsaw was an indisputable highlight of the market. At present, there are no large-scale retail projects under construction. The markets of the key metropolitan areas are becoming increasingly saturated, but there is still room for smaller, complementary retail schemes in both large cities and smaller towns. The shopping centre space density in the eight largest conurbations is at nearly 850 sq m per 1,000 inhabitants, while in cities with less than 100,000 inhabitants it is below 500 sq m.

Several new brands took advantage of the opening of Galeria Młociny to enter the Polish market or will build a presence here in the near future – these include an Italian menswear retailer Gagliardi, a German bodywear brand Sloggi, with its first mono-brand store in Poland, and a Ukrainian family restaurant concept Pesto Cafe. The market is still awaiting the entry of the Irish fashion retailer Primark into Poland. Newcomers to the Polish market in the first half of 2019 included the entertainment park TEPfactor at Blue City, a fashion retailer Boxeur des Rues at Factory Poznań, and MyShoes, Deichmann’s new brand, which opened stores in Galeria Mokotów, Galeria Katowicka and Galeria Echo in Kielce.

Prime rents for retail space at first-rate shopping centres remain flat, but secondary or underperforming scheme rents are coming under downward pressure.

Another 200,000 sq m of retail space is scheduled for opening in the second half of 2019 and this year’s total retail supply is expected to be on par with last year’s volume. The retail development is set to decelerate in the coming years, largely due to a paucity of large and very large projects in the pipeline. Strong growth is, however, expected in smaller cities and in the segment or small and medium-sized shopping centres and retail parks. More than 40% of this year’s new supply will be delivered in towns with populations below 200,000.