Retail parks could account for 28% of the market by 2030
The retail park format was gaining popularity before the pandemic and continues to grow despite it. Over the past 20 years, their share of the total pool of shopping facilities in the country has increased from 6% to 15% and they now occupy approximately 1.97 million m². This is facilitated by their locality, concentration in one place of stores securing basic needs and smaller number of customer contact points than in large centers. According to CBRE experts, current trends indicate that by 2030 retail parks may account for 28% of all shopping space in Poland.
– In recent years, we have seen an increase in the importance of retail parks as an investment product. The number of transactions has gradually increased, and some investors have begun to specialise exclusively in this format. The Covid-19 pandemic has strengthened the position of retail parks. Investor interest in this format, especially facilities with a grocery operator, has gained momentum. We expect the trend to continue in the coming years. Yields for well-commercialized retail parks usually range from around 8% to slightly above 9%. In large urban centers, they can reach a level below 8% – says Piotr Karpiński, head of the property management department at CBRE.
Parks as strong competition
The total retail space in Poland currently amounts to almost 12.8 million m². Shopping centers account for 83% of the total. Retail parks are in second place, with a share of 15% and occupied space of 1.97 million m². The podium is closed by outlet centers, whose share in the total retail space is currently 2%.
The vast majority of the existing retail parks were built within the last 10 years (approx. 1.43 million m².), but only in 2020 this market expanded by over 200,000 m². of such space. The forecasts for the coming years are also very promising – the segment will develop steadily and by 2030 it may account for 28% of the total market.
Focus on smaller cities
Over the years and with the growing saturation of retail space in the largest cities, developers began to recognize the potential of smaller urban centers and the needs of their residents, who lacked modern and comfortable retail space in their city. In the year 2000, the modern retail space market was dominated by agglomerations with a 78% share in the then supply. In 2010, supply in agglomerations already accounted for 61% of total space, and 10 years later – for 55%. During these 20 years, the share of supply in small and medium-sized cities has almost tripled.
– Soon the market will be supplied with 170,000 m² of new space in the format of retail parks. The vast majority of this, i.e. 80%, will be constructed in small cities with the population of less than 100 thousand – says Piotr Karpiński.