INCLUDES THE SAVILLS SHOPPING CENTRE BENCHMARK - SAVILLS EUROPEAN RESEARCH Q3 2016 - RENEWS.PL
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Savills European Research
Q3 2016
savills.com/research
Includes the Savills
Shopping Centre Benchmark
2016-2017 savills.com/research 01Market report | European retail
An introduction to Savills
Source: Savills
Savills is a leading global real Savills provides a comprehensive We are regarded as an innovative-
estate service provider listed on range of advisory and professional thinking organisation supported by
the London Stock Exchange. The property services to developers, excellent negotiating skills. Savills
company, established in 1855, has a owners, tenants and investors. chooses to focus on a defined set of
rich heritage with unrivalled growth. These include consultancy services, clients, offering a premium service
The company now has over 700 facilities management, space to organisations and individuals
offices and associates throughout planning, corporate real estate with whom we share a common
the Americas, Europe, Asia Pacific, services, property management, goal. Savills is synonymous with a
Africa and the Middle East. leasing, valuation and sales in high-quality service offering and a
all key segments of commercial, premium brand, taking a long-term
In continental Europe, Savills residential, industrial, retail, view of real estate and investing in
has 57 offices covering Belgium, investment and hotel property. strategic relationships.
France, Germany, Greece, Italy, the
Netherlands, Poland, Spain and A unique combination of sector
Sweden. We also have associate knowledge and entrepreneurial flair
offices in Austria, Denmark, gives clients access to real estate
Finland, Norway and Portugal. expertise of the highest calibre.
02December 2016
Contents
European overview 04
Shopping centre investment benchmark 05
Austria 09
Belgium 10
Denmark 11
Finland 12
France 13
Germany 14
Greece 15
Ireland 16
Italy 17
Netherlands 18
Poland 19
Serbia 20
Spain 21
Sweden 22
UK 23
Key indicators 24
Contacts 26
savills.com/research 03Market report | European retail
European overview Lydia Brissy Eri Mitsostergiou
European Research European Research
+33 (0) 144 51 73 88 +40 (0) 728205626
lbrissy@savills.com emitso@savills.com
Retail trends demand. It was notable the steady Helsinki and Warsaw.
Despite the strong growth of online increase of acquisitions of prime high
sales across Europe (12% yoy in street assets. A notable rise of investment into
2016), the majority of retail sales prime high street units is reflected
still takes place in physical stores In the first three quarters of 2016, into the continuous yield compression
(e-commerce accounts for less than retail investment accounted for trend noted in the prime segment
10% of all retail sales). Shops located about a quarter (24.4%) of the total of this sector. The average prime
in the busiest high streets and best investment activity in our survey high street yield in our survey area
shopping centres are the target of area, slightly down from its share has reached the record low of 4.0%
several international brands, which are last year (26.7%). It remains however in Q3 16, 16bps lower than Q3 15.
expanding particularly in markets with above the long-term average of The lowest yields were noted in
good economcs and demographics 23.4%. Similarly, Q1-Q3 2016 retail London (2.9%) and Paris (2.75%).
(Germany, Nordics) and strong tourist volume was still 40% above the The highest annual yield compression
flows (London, Paris, Vienna, Milan, 10-year average, as retail remains was recorded in Milan (-75bps) and
Madrid). Additionally, pure play retailers investor' favourite asset class after Cologne (-50bps), while in almost all
are also seeking physical presence offices. Despite the overall drop markets prime yields are at record
through temporary or permanent stores of total turnover in the two largest low levels.
in order to maximise the synergies markets of the UK (-18%) and
between online and offline retailing. Germany (-46%), some investors The average RW yield dropped below
have shifted their attention to non- 6.0% and was 27bps below Q3 15
Demand for the best units is reflected core markets, which in contrast level. In 62% of our markets, prime
in the higher rents (yoy) commanded experienced a significant rise in retail RW yields have continued to squeeze
in a number of prime high street (HS) investment, such as Ireland (223% to by -30bps yoy or above. Notable
and shopping centre (SC) locations, €1.46bn), Poland (126% to €1.4bn) inward yield shifts were noted in
particularly in cities where international and Italy (119% to €1.8bn). End year Amsterdam (-100bps), Milan (-175
retailers are expanding, such as volume is predicted to be about 20% bps) and Berlin (-60bps).
Brussels (8% HS), Copenhagen (11% below 2015.
SC, 5% HS), Amsterdam (2% HS), It is interesting to note that in 60%
Stockholm (2% SC) and second tier Yields of the markets yields were at the
cities where retail rents have not yet Prime SC yields have stabilised in same level as their previous peak,
fully recovered such as Athens (12% most locations (68%) across our while in four markets (Helsinki,
HS) and Dublin (3% HS). Higher markets, however there are still some Madrid, Vienna and Warsaw), prime
rents compared to last year were locations where notable inward yield SC yields were at least 25bps below
also charged in good quality retail shifts were noted over the past year: their previous 15-year record low.
warehouses in Madrid (13%) and in Vienna prime SC yields moved in Further yield compression potential
Dublin (35%). by 125 bps yoy, in Milan by 100bps, is noted in Athens and Dublin where
in Madrid by 75bps and in Stockholm prime SC yields were 190 bps and
The polarisation between prime and by 50bps. Prime yields compressed 150 bps above their previous peak
secondary locations remains a market by 25 bps yoy in Amsterdam, respectively. ■
characteristic, with lower demand and GRAPH 1
stable or negative rental growth trends. European retail investment Q1-Q3 16
Retail investment 10,000 250%
Millions
9,000
The total investment into the retail 200%
8,000
sector over the period Q1-Q3 2016 7,000 150%
was about €33.3bn in the 15 markets 6,000 100%
that we monitor. This is a significant 5,000
4,000 50%
decrease of 28% compared to last
3,000 0%
year. However, 2015 was a record 2,000
year in terms of retail investment, -50%
1,000
which was underpinned by numerous 0 -100%
Austria
Netherlands
Finland
France
Poland
Ireland
Spain
Germany
UK
Belgium
Sweden
Italy
mega deals and large portfolios.
Lower supply of similar large-scale
assets and the strategic decision of
several investors to hold on to prime Q1-Q3 16 yoy change
assets has restricted transaction
activity, despite strong investor Source: Savills
04December 2016
Shopping centre investment
benchmark
Introduction to the market size, the market stability,
Benchmark results
benchmark retail prospects and potential returns.
1st Stockholm
For years, London was leading all
European cities in terms of shopping Depending on the indicators 2nd Warsaw
centre investment volume. Back in in question, the data used was
3rd London
2011, shopping centre investment collected at metropolitan and
th
in London accounted for 26% of the national level. These indicators 4 Amsterdam
total accumulated in the 23 European use the latest data available, (2015 5th Paris
cities covered in this report. Since for annual data and Q3 2016
for quarterly data) and five-year 6th Dusseldorf
the beginning of the year, the London
share decreased to approximately forecasts to ensure the benchmark 7th Lyon
9%. Meanwhile, Krakow and Helsinki incorporates a forward-looking view.
8th Copenhagen
took the lead representing 22% and
13% of the total respectively. The various indicators have been 9th Poznan
ranked and weighted across the
10th Brussels
While it is true that the surge for 23 cities included in this report.
prime assets in core countries in the The results do not determine the 11th Milan
aftermath of the Global Financial exclusive attractiveness of a given 12th Vienna
Crisis, and the consequent dry up city, it purely provides a macro guide
for investors. 13th Marseille
of such products is an explanation
of the recent shift in the market, 14th Krakow
changes in demographics, Benchmark results 15th Helsinki
urbanisation trend, new consumers’ Full results of the 2016 European
habits and behaviours are all Investment benchmark reveals that 16th Manchester
reshaping the European retail sales Stockholm is ahead of all the cities 17th Berlin
landscape. covered in this benchmark with 68.9
points, closely followed by Warsaw 18th Wroclaw
The European shopping centre with 68.2 points, then by London 19th Munich
benchmark highlights how European (60.8), Amsterdam (60.1) and Paris
20th Lodz
cities should perform against each (59.8). The average grade is 50.1.
other in the next five years and 20th Edinburgh
assess expected performances
22nd Madrid
against risk premiums. By examining
a wide range of criteria, Savills hope 23rd Athens
to identify the shopping centre hot
spots for investors. GRAPH 1
Share of investment volume Changing investment
This research report covers
23 European cities including
destinations
Amsterdam, Athens, Berlin, Brussels, Past five years In 2016
Copenhagen, Dusseldorf, Edinburgh, 25%
Share of the total SC investment volume
Helsinki, Krakow, Lodz, Lyon, Madrid,
Manchester, Marseille, Milan, Munich, 20%
Oslo, Paris, Poznan, Stockholm,
Vienna, Warsaw and Wroclaw.
15%
The analysis used to benchmark
10%
shopping centre investment
opportunities draws on various
indicators including retail sales, 5%
shopping centre sales per sq m,
estimated stock per inhabitants, 0%
rental growth, yield, total return, GDP
Kraków
Helsinki
Milan
Łódź
Wrocław
Madrid
Manchester
Brussels
Munich
Amsterdam
Edinburgh
Lyon
Marseille
Athens
Poznań
Warsaw
Berlin
London
Stockholm
Paris
Copenhagen
Düsseldorf
Vienna
stability and unemployment with the
aim to assess for each city four types
of market fundamentals, namely the
Source: RCA
savills.com/research 05Market report | European retail
Stockholm tops the Warsaw shows bright London still high in the
league prospects battle field
Stockholm not only has the highest The typical profile of investors Like Stockholm, London has both
grade but also shows evenly looking into the Warsaw shopping a large market size and strong
high potentials in the four types centre market is more opportunistic prospects. It is however, more
of fundamentals selected in this since most of the strength of the volatile than Stockholm. But volatility
research analysis. It is the best well- market rely on retail prospect and is not just bad news, it brings
balanced market in terms of size, potential returns. The annual retail opportunities to short term investors
stability, prospect and returns which sale volume in Warsaw is relatively seeking to catch the cycle. London
make it a safe-haven and a target for small compared to other cities. Yet is amongst the top five cities of our
the widest type of investors seeking citizens of Warsaw spend a lot in benchmark due to its large market
to invest in shopping centres. A retail, especially if you take into size. GDP per capita (€89,400) is
solid economic base is the obvious consideration their GDP per capita the highest in all 23 cities, volume of
result that came to the fore. GDP in (€31,730), which is relatively modest retail sales in London is the second
the metropolitan area of Stockholm compared to most other European highest after Paris and retail sale
grew 4.8% last year, the strongest cities benchmarked in this report. per inhabitant is also in second
growth amongst the 23 cities and Last year, retail spend per inhabitant position after Dusseldorf (€10,400).
far above the EU average which was was on average €9,740 which is Additionally, retail sales should
2.1%. During the year, the Swedish the top fifth result of all 23 cities. grow annually by 2.4% on average
economy slowed down. GDP growth Since retail sales are expected to in the next five years. The stock of
is expected to end at 4% for the increase fast in the next five years, shopping centre per inhabitant (363
full year, this remains well above all by 5.6% pa on average, the second sq m/1,000 inhabitants) is relatively
other city forecast. If the population highest growth expected after in line with average and the level of
of Stockholm is relatively small, it is Kraków (5.6%), Warsaw will become construction is low. Prime assets
wealthy. GDP per capita is €59,000 the biggest retail spending city per on the market are scarce and
and most importantly retail sales per inhabitant (€11,650) by 2021. The competition is fierce. Due to strong
inhabitant in Stockholm is €10,080, existing stock is high (1,3m sq m), level of activity between 2010 and
the top four following Dusseldorf, one of the highest per inhabitant, 2011 when prime yields were 175-
London and Paris. Additionally, retail which can be explained by limited 150 bps higher than it is today, we
sales are expected to grow fast, by offer in high street format. It is believe some investors may consider
2.6% pa on average until 2021; the also growing fast, +19% planned selling.
highest growth forecast after the five until 2018 which may be the
Polish cities. Both total shopping main concern about the market. GRAPH 3
centre stock (1.4m sq m) and stock Nonetheless, so far, the vacancy Retail sale prospects
per inhabitant (635 sq m per 1,000 rate is low and international brands
inhabitants) are large. The stock is are actively looking into the market. Kraków 4.6%
expected to grow by 2.3% until 2018 Low unemployment, strong GDP Warsaw 4.3%
which will provide investors with growth ahead and a large population
Wrocław 3.8%
more investment opportunities. suggest the market size of Warsaw
Poznań 3.7%
could compete with core markets in
Łódź 3.2%
the short to medium terms.
Stockholm 2.6%
London 2.4%
Edinburgh 2.4%
GRAPH 2 Helsinki 2.4%
Profile of the top five cities Amsterdam 2.4%
Manchester 2.2%
Market size Market stability Retail prospect Potential Return Madrid 2.1%
25 Lyon 2.0%
Average 1.9%
20
Berlin 1.6%
Marseille 1.6%
Milan 1.5%
15
Paris 1.4%
Grade
Brussels 1.1%
10 Munich 1.1%
Düsseldorf 1.1%
Vienna 0.9%
5
Athens -0.2%
-1% 0% 1% 2% 3% 4% 5%
0 Average annual growth 2016-2021
Stockholm Warsaw London Amsterdam Paris
Source: Savills Source: Oxford Economics
06December 2016
Amsterdam position Hot Spots for 2017-2021 Value for money
lies on its population Behind these raw scores, the data Cities at the right top end of the
growth Like Stockholm, analysis yields interesting insights graph have smaller market size but
grades obtained for Amsterdam into motivation for investors to invest have solid market fundamentals
are also very balanced between in some cities rather than others. and offer competitive pricing. This is
the market size, stability, prospects To highlight market specificities we where investors should find “value
and returns. The Dutch capital compared our benchmark results, for money”. Warsaw and Amsterdam
does not markedly stand out in as showed in the graph 2 below with outperform in this category with
any of the features retained for this two parameters, pricing (y axis) and Warsaw clearly ahead.
benchmark, but shows some solid market liquidity simply measured
results, notably high GDP per capita by the average investment volume Risk embracing
(€68,360) and good level of retail over the past five years (size of the In the left top corner we find
sales per inhabitant (€9,140). What is bubbles). We divided the graph cities with still small market size
really making the difference for this in four parts, in the x axis by the and potentially volatile but where
benchmark and more generally for average grade of our benchmark and prospects are good so as potential
the retail perspective in Amsterdam, in the y axis by the average of prime returns. These are the cities that
is the fast growing population, yields. investors “embracing risks” should
equivalent to that of Munich (1.5% pa target. Krakow stands out with the
on average expected over the course Safe heaven highest result. Indeed, according to
of the next five years). The density of In the right bottom corner we find Oxford Economics, retail sales are
shopping centre stock in Amsterdam cities, which according to our expected to grow by 4.56% pa on
is low compared to the other four benchmark results, are likely to average over the next five years,
leading cities, (244 sq m per 1,000 perform well and where yields are compared to 1.95% on average.
sq m inhabitants) and development the lowest. We called cities that The strong potential of the city has
activity remains limited. This can falls in this rectangle “Safe heaven”. already catch investors interest as
restrain investment activity, but at the Stockholm appears to be not only witnessed by two large deals signed
same time low levels of stock also the strongest performer but the recently, the acquisition of the
means less competition between Swedish city also offers higher yields Krokus shopping centre in Kraków
centres and low vacancy. (4.5%) than London (4.25%) and by Mayland Real Estate and the
Paris respectively. Dusseldorf, which acquisition of Bonarka City Center
Paris complete the list came out to the sixth position in by Rockcastle Global Real Estate for
of top five cities our benchmark, turns out to be a €361 million.
Paris ranks fifth in our benchmark city that investors should definitely
thanks to its overall market size, consider as it shows relatively similar
which is clearly the biggest of all results to that of Paris.
benchmarked cities. However,
data related to future prospect
and potential returns show weaker
results than the top four cities. The
volume of retail sales in Paris is GRAPH 2
the largest in terms of retail sales Hots Spots
per inhabitant, which is €10,350.
Finally, French shoppers tend to
spend more in shopping centres 7.0%
Risk embracing Value for money
than in other European countries,
which is notably due to the very 6.5%
Kraków Poznań
large stock of shopping centres in Wrocław
France. Hence our estimation of 6.0%
the average shopping centre sales Warsaw
per sq m in Paris is the highest of 5.5% Amsterdam
all cities covered in this analysis. Milan
Marseille
Yet, in Paris, the stock of shopping 5.0%
Price
Lyon
Berlin Stockholm
centres per inhabitant is slightly Edinburgh
Düsseldorf
below the benchmark average (350 4.5% Brussels
London
Manchester
sq m / 1,000 inhabitants) and also Paris
Helsinki
well below the national average. 4.0% Madrid
Vienna
Copenhagen
Devolvement activity has been Munich
particularly strong over the past 3.5%
few years. Based on the planning Safe heaven
pipeline, we expect the stock to grow 3.0%
by 9% until 2018. We believe this 30 35 40 45 50 55 60 65 70 75
activity is notably due to the Grand Performance
Paris project.
Source: Savills
savills.com/research 07Market report | European retail
Conclusion Obviously, London and Paris will
remain high on investors' radar,
OUTLOOK
Beyond the core and traditional especially London for the weak
pound, whereas the Parisian retail
Focus on prime locations
markets most investors generally
focus on, our benchmark highlighted market as not yet fully recovered since
■ Consumer spending is predicted to grow by
three markets to be considered. last year's terror attacks, notably the
1.8% yoy on average this year across the markets
Stockholm, a safe haven which shows luxury segment of the market.
we analyse, therefore we expect retailers to
strong results in nearly all aspects continue to look for prime space in cities with large
taken into account in the analysis. The average prime yield in these cities
populations, rising tourist numbers and healthy
Stockholm can attract investors is 4.9%; 35bps lowers than before
disposable incomes.
with different profiles and strategies the Global Financial crisis. Yet we still
at competitive price compared to expect some yield hardening over
■ We expect to see retailers experimenting with
London and Paris. Warsaw, where the the 12 months due to solid investor
different concepts (eg big-bulk retailers opening
spending per inhabitant is high and interest for prime assets. Furthermore,
small in-town stores, retail parks incorporating
fast growing. Amsterdam, thanks to its in some cities, notably Vienna or Paris,
more F&B and leisure) in an effort to meet different
fast growing population. Dusseldorf, the prime yield has not yet reached its
consumer needs, which will be divided between
Poznan and Krakow are also some pre-crisis level. ■
convenience and experience and the strong
investment destinations to look at. competition from the rising share of e-commerce.
Dusseldorf, for being an alternative
to Paris, Poznan and Krakow for their ■ At the same time, omni-channel strategies
competitive pricing while showing will continue to be applied not only by traditional
strong retail prospects. retailers, who are improving their online platforms
but also by pure online players who acknowledge
Retail sales per inhabitant the importance of physical stores in their sales
potential.
2016 2021 ■ Prime rents are most likely going to stabilise
1 Dusseldorf 1 Warsaw in the ‘flagship’ gateways such as London, Paris,
€10,461 €11,647 Milan and Munich, while cities which are considered
as ‘opportunity’ gateways such as Amsterdam,
2 London 2 London Madrid and Barcelona rents may continue to rise.
€10,396 €10,861 (Also refer to our report ‘Expand into Europe: Retail
destination index 2016).
3 Paris 3 Paris
€10,347 €10,818 ■ Prime yields have moved in significantly is most
locations and we expect them to stabilise next year,
4 Stockolm 4 Stockolm with few markets showing further inward yield shift
€10,084 €10,728 potential, such as Brussels, Copenhagen, Belgrade
and Milan. Investment volumes will continue to be
5 Warsaw 5 Dusseldorf restricted by the lack of supply of prime product.
€9,744 €10,695 We believe that prime high streets will attract further
more investor interest.
Source: Oxford Economics
GRAPH 6 GRAPH 7
Prime yields Q3 2016 Shopping centre stock and pipeline
30
8%
7% 25
6%
20
5%
4%
Million sq m
15
3%
2% 10
1%
0% 5
Madrid
Manchester
Helsinki
Munich
Brussels
Edinburgh
Lyon
Marseille
Milan
Kraków
Łódź
Wrocław
Amsterdam
Warsaw
Poznań
Athens
Copenhagen
London
Paris
Vienna
Düsseldorf
Stockholm
Berlin
0
2013 2014 2015 2016 2017 2018
Source: Savills Source: Savils
08December 2016
Austria Franz Poeltl Thomas Schanda
Austria Investment Austria Research
EHL EHL
+43 (0) 1 512 7690 890 +43 (0) 1 512 7690 705
f.poeltl@ehl.at t.schanda@ehl.at
Retail Trends Development is quite subdued, as With top rents exceeding €400 per
PRIME YIELDS
Economic growth increased by 1.7% refurbishment and modernisation are sq m/month (in some cases up to
2016 and 2017
in 2016 after four consecutive years the key trends for the market. €600 per sq m for small locations)
OUTLOOK
of comparatively low growth. Due to the luxury locations around
a positive influence of the introduced Rents and Yields Kohlmarkt, Tuchlauben, Graben and SC Q4 16 4.25%
tax reform at the beginning of Top yields for shopping centres are Bognergasse mark the prime high
2016, the ongoing public spending now at 4.25%, retail warehouse street retail segment within Austria
for asylum seekers as well as the parks transact at yields around and continue to attract international HS Q4 16 3.5%
upcoming effects of the housing 5.75%. High-street location yields are retailers. On secondary and tertiary
initiative, the outlook for the market is – especially in the inner districts of locations the beforementioned focus
positive and retail sales, both online Vienna- substantially below this level. on the best locations only, leads to a
and in brick-and-mortar locations Rents in prime high street locations downward trend for rental levels. ■
increased during the first half of remain stable, whereas still rising in
2016 by more than 1%. Online sales the top shopping centre destinations.
growth – with an approximate 3%
increase - is still outnumbering the GRAPH 1
improvement of “touch & feel retail Vienna retail rents and yields
sales”, although growth has slowed
down over the past 18 months. The
strong development of tourism, with
more than 14.3m overnight stays in Prime SC rents Prime HS rents
Vienna in 2015, combined with stable Prime SC yields Prime HS yields
economy sustain Vienna’s position 5,000 10%
among the top destinations for retail 4,500 9%
expansion within Europe. Retailers 4,000 8%
continue to focus on prime locations,
Euro per sqm/year
where- following the emphasis only 3,500 7%
on “GOOD-BETTER-BEST” space - 3,000 6%
demand still exceeds supply.
2,500 5%
Investment and 2,000 4%
Development 1,500 3%
The Austrian investment market as a
whole has remained strong in 2016 1,000 2%
with a new record transaction volume 500 1%
of €3.6bn likely (1st half year €1.3bn)
0 0%
driven by strong demand especially
2011 2012 2013 2014 2015 2016 Q3
from new capital sources from North
America and Asia. The limiting factor
throughout 2016 was the shortage of Source: EHL
investment grade product, pushing
yields even further down. Due TABLE 1
to this lack of available property, Major shopping centre develpments
only about €50m were transacted
during the first half 2016, whereas a Property Location Type Size Opening
volume of more than €830m of retail
Plus City Linz/Leonding Shopping centre 70 shops extension 2016
properties changed hands during
2015. Furthermore, the consolidation
of online and brick-and-mortar retail Hatric Hartberg Retail park 25 shops extension 2016
has led to space reductions and
secondary and especially tertiary
Seestadt
location owners have to look for Bregenz Bregenz Shopping Centre 21,000 sq m 2017
alternate usage solutions.
Source: EHL
savills.com/research 09Market report | European retail
Belgium Gregory Martin Henry Colle
Belgium Investment Belgium Research
+32 2 542 40 52 +32 2 542 40 54
gmartin@savills.be hcolle@savills.be
Retail Trends (36,000 sq m), The Mint in Brussels for retail parks, prime rents remain
PRIME YIELDS
After a weak start partly linked to (15,000 sq m), etc. The completion recorded in the Drogenbos Park which
2016 and 2017
security threats, private consumption volume of new retail areas was was fully refurbished and stands at
OUTLOOK
strengthened, rising by 0.3%. The boosted this year with the delivery of €175 per sq m/year. As risk averse
consumer confidence index has also Docks Bruxsel at the end of Q3. behaviour continues to characterise SC Q4 16 4.25%
risen in November, partially wiping the market, investors’ appetite has
out the setbacks of the two previous Rent and Yields remained focused on prime and well-
months. Occupier and investor Prime rents for high streets in Brussels located assets. Due to the scarcity HS Q4 16 3.5%
demand for core retail products is (Rue Neuve, Goulot Louise) and of these assets and the competition
forecast to remain stable in 2017. Antwerp (Meir, Schuttershofstraat) between investors, prime yields
remained stable in 2016, at €1,850 experienced pressure. In 2016 year-to-
Investment and per sq m/year. For shopping centres, date, yields currently stand at 3.75%
Development prime rents are recorded in the for high-street assets, 4.25% for
Pure investment volume in 2016 Wijnegem Shopping Center (AEW) shopping centres and 5.75% for the
year-to-date stood approximately at with €1,600 per sq m/year. Finally best located retail warehouse units. ■
€2bn, which is ca. 35% lower than
last year at the same period in term of GRAPH 2
volume but ca. 15% more deals were Brussels retail rents and yields
recorded. The Belgian investment
market in 2016 is mainly dominated by
the office market, accounting for 45% Prime SC rents Prime HS rents
of the total investment turnover (25% Prime SC yields Prime HS yields
for the retail sector). The retail market 2,000 10%
in Belgium remains dominated by 1,800 9%
domestic players and private investors
in retail high-streets. The most 1,600 8%
Euro per sqm/year
important deal in 2016 year-to-date 1,400 7%
is the sale by Prowinko of the Toison 1,200 6%
d’Or, a high street complex of 4 units
let to Apple, Zara, Marks & Spencer 1,000 5%
and Bodum. It was bought by GH 800 4%
Group for ca. €180m. The second
600 3%
largest transaction is the Hydrion
retail warehousing park in Arlon for 400 2%
ca. €60m (bought by Redevco). For 200 1%
the end of the year, CBRE Global
Investors is expected to close the 0 0%
deal of the Médiacité, a 45,000 sq m 2011 2012 2013 2014 2015 2016 Q3
shopping center in Liège developed
by Wilhelm & Co. The transaction is Source: Savills
estimated around €260m. Several new
TABLE 2
development projects and expansions
of existing shopping centers are in Major shopping centre develpments
the pipeline for the coming years. Property Location Type Size Opening
Although it is unlikely that all projects
will be developed as the necessary
Rive Gauche Charleroi Shopping centre 36,000 sq m 2017
permits are increasingly difficult
to obtain, we estimate the current
pipeline to ca. 500,000 sq m (half
The Mint Brussels Shopping centre 15,000 sq m 2017
of the current stock). The two most
notable projects are to be found in the
North of Brussels periphery: Uplace Les Bastions Tournai Shopping centre 14,500 sq m 2017
(81,000 sq m) and Neo (80,000 sq m). extension
There is also Rive Gauche in Charleroi
Source: Savills
010December 2016
Denmark John Lindgaard Stig Plon Kjeldsen
Denmark Investment Denmark Research
Nybolig Erhverv Nybolig Erhverv
+45 3364 6500 +45 33 64 65 65
jli@nybolig.dk spk@nybolig.dk
Retail Trends IKEA store is scheduled to open in expected to remain at the current
PRIME YIELDS
The market for retail leases 2019 and will feature three storeys of level. ■
2016 and 2017
in Denmark’s largest cities IKEA products.
OUTLOOK
is characterised by renewed
optimism among the retailers. Rents and Yields SC Q4 16 4.0%
Growing populations and better Rent levels on high street locations
personal finances seem to have are generally on the rise, however,
counterbalanced the reluctant the tendency is more pronounced in HS Q4 16 3.75%
consumer spending and the the three largest cities: Copenhagen,
increased share of e-commerce, Aarhus, and Odense. In Copenhagen,
which has characterised the retail prime rent levels on Strøget are in
market for a long period of time. the level of 22,000 DKK per sqm/
This positive development first and year. Over the next 6-12 months, we
foremost benefits prime locations expect moderately increasing rent
where activity is increasing, while levels in Copenhagen and Aarhus,
prosperity on more secondary whereas the rent level in Odense is
locations remains rare.
Retail rental activity in the capital GRAPH 3
area is excellent. Over the last 24
months, the store composition on
Copenhagen retail rents and yields
the main high streets Strøget and
Købmagergade has changed due to Prime SC rents Prime HS rents
a large influx of international brands. Prime SC yields Prime HS yields
This is a sign that Copenhagen 3,000 10%
has manifested its position as an
internationally recognised metropolis.
9%
2,500
8%
Investment and
Euro per sqm/year
7%
Development 2,000
The market for Danish shopping 6%
centres is also developing positively; 1,500 5%
especially shopping centres in
the capital area are experiencing 4%
prosperity. Several of the largest 1,000
3%
shopping centres in the capital
2%
area are currently renovating and 500
expanding, and others have plans 1%
to do the same in the near future. 0 0%
Among the exceedingly interesting
2011 2012 2013 2014 2015 2016 Q3
projects are the expansion of
Copenhagen Mall, which according Source: Nybolig Erhverv
to current plans will include an
TABLE 3
expansion of 13,000 sqm retail area
and 68,000 sqm office - and hotel Major shopping centre developments
facilities. These plans are, however,
Property Location Type Size Opening
still at the project stage. Additionally,
IKEA, Bjarke Ingells Group, Dorte Copenhagen Mall Copenhagen Shopping centre / Mixed use 13,000 sq m extension 2020
Mandrup Architects, and the hotel
chain Cabinn are cooperating on
a district plan proposal for the IKEA Copenhagen Retail Park/Mixed use 45,000 sq m 2019
neighbouring property on which a
new IKEA store will be established
Rødovre Centrum Copenhagen Shopping centre 6,000 sq m extension 2018
along with 500 youth housing units
and 21,000 sqm hotel facilities. The Source: Nybolig Erhverv
savills.com/research 011Market report | European retail
Finland Timo Tikkinen Irma Jokinen
Finland Investment Finland Research
Realia Realia
+358 40 844 3348 +358 20 780 3726
timo.tikkinen@realia.fi irma.jokinen@realia.fi
Retail Trends 450,000 sq m. Market-type retail over the past few years, however,
PRIME YIELDS
The overall economic situation construction is strong as well. Apart tenants’ challenges will be, among
2016 and 2017
has improved thanks to recovery from dynamic new construction, others, decline in the rental levels
OUTLOOK
in domestic demand and private changes in consumer behaviour and of new leases. Following the
investment. Consumer confidence restructuring of trade challenge both economic downturn and increasing SC Q4 16 4.5%
is now well above the long-term property investors and retailers. e-commerce sales, small street-level
average and reflects improved stores (grocery stores excluded),
consumption growth. Rents and Yields have suffered most from increase HS Q4 16 5.0%
The volume of retail sales grew Prime rents across all retail sectors in vacancy. Shopping centres have
by 3.3% yoy in September 2016 have remained stable in 2016. performed better than other retail
nationwide. In H1, retail sales Prime yields for HS and SC have sectors supported by increasing
increased by 0.7%. The total volume stabilised, while supermarkets number of visitors and sales. Prime
of shopping centre retail sales and retail warehouses have edged SC rents have shown a moderate
increased by 3.6% in the capital slightly downwards. The overall upward trend in autumn 2016. ■
region, while in the rest of Finland retail occupancy rate has remained
the increase was 4.4% in Q2 2016. quite high at 95%. Take-up for
In the same period the number of retail space has increased markedly
visitors increased by 6.1% in the
capital region and by 3.7% in the rest
of Finland. GRAPH 4
New extended shopping hours Helsinki retail rents and yields
were completed in January 2016.
Almost half of consumers have taken
Prime SC rents Prime HS rents
advantage of longer opening hours,
Prime SC yields Prime HS yields
translating in higher sales for large 2,000 10%
stores, but lower sales for small
9%
stores. Previously, only small stores
were entitled to set their own opening 8%
1,500
Euro per sqm/year
hours. 7%
6%
Investment and
1,000 5%
Development
Retail investment demand 4%
remains strong. The share of retail 3%
investments has accounted for 500
2%
45% this year to date (excluding
residential). Lack of investable 1%
product, especially large scale deals, 0 0%
is limiting the higher volumes of 2011 2012 2013 2014 2015 2016 Q3
retail investments. After high trading Source: Realia/Savills
volumes of major retail portfolios,
supply for desired product has TABLE 4
decreased. Good retail assets attract
both domestic and international
Major shopping centre developments
investors. Property Location Type Size Opening
Investments in retail construction
40,000 sq m
have strongly increased recently Iso Omena, phase I and II Espoo, Matinkylä Shopping centre 2016 - 2017
(extension)
after a couple of year sluggish
20,000 sqm
period. There are numerous new Ainoa, phase II Espoo, Tapiola Shopping centre 2017
(extension)
shopping center developments Kesko Itäkeskus project, phase
both under construction and in Helsinki, Itäkeskus Shopping centre 60,000 sq m 2017 - 2019
I and II
the pipeline. By the end of 2018 Mall of Tripla (part of Tripla Helsinki, Central Shopping centre 85,000 sq m 2019
the leasable shopping centre area Centre) Pasila
is estimated to increase by some Source: Realia
012December 2016
France Alexandre Boucly Christian Nehme Marie Josée Lopes
France Retail France Retail France Research
+33 (0) 1 44 51 73 14 +33 (0) 1 44 51 73 26 +33 (0) 1 44 51 17 50
aboucly@savills.fr cnehme@savills.fr mjlopes@savills.fr
Retail Trends The period 2016-2017 could result in park sector.
PRIME YIELDS
2016 has been, in various aspects, a historic peak in terms of projects.
2016 and 2017
a challenging year for the French 49 shopping centre projects will Rents and Yields OUTLOOK
retail market, with last year’s terrorist be finished by the end of 2017, Paris remains dynamic thanks to its
attacks and frequent strikes having including 17 planned for the end internationally-renowned shopping SC Q4 16 4.0%
a negative impact on shopping of 2016. 55% of these projects are streets. The Avenue des Champs
centre footfall. Despite the uncertain extensions/renovations. 26 retail Elysées still benefits from its luxury
environment, activity has returned parks projects will also be completed reputation and prime rents remain at HS Q4 16 2.5%
to normal levels and consumer by the end of 2017, including 4 €21,000 per sq m/year.
sentiment remains high, with the before December 2016. The share Prime yields continue to compress
household confidence index at 97 in of new developments is dominant, and they stand at 4.25% for
September 2016. at 88%. The significant number of shopping centres and 5.0% for retail
The increase in private consumption new projects combined with a high parks. ■
(up 1.5% in 2015 and 1.9% growth share of restructuring/extension,
predicted for this year) is based on is an indicator of the momentum,
energy consumption and an increase innovation and renewal of the retail
in household appliance purchases.
This will contribute towards retail GRAPH 5
sales, which are expected to grow by Paris retail rents and yields
2.8% in 2016 (against 3.8% in 2015).
The multichannel strategies highlight
the synergy between trading online Prime SC rents Prime HS rents
and in stores. Geographical proximity Prime SC yields Prime HS yields
22,000 10%
and direct customer interaction
now appeal to large online retailers 20,000 9%
(Amazon, Cdiscount, LDLC, 18,000 8%
Euro per sqm/year
Feelunique, Birchbox, etc) who are 16,000 7%
developing a network of stores (pop- 14,000
up stores, flagship stores, etc). 6%
12,000
Since the beginning of the year, 5%
many new and international retail 10,000
4%
concepts have entered the market, 8,000
6,000 3%
principally in ‘chic’ or ‘hyped’
neighbourhoods. Three key markets 4,000 2%
can be highlighted: Fashion/clothing, 2,000 1%
Food and Beauty/Healthcare.
0 0%
2011 2012 2013 2014 2015 2016 Q3
Investment and
Development Source: Savills
In France, nearly, €2.5bn has been TABLE 5
invested in retail real estate since
the beginning of the year. After
Major shopping centre developments
two exceptional years, boosted by Property Location Type Size Opening
investments in commercial shopping
centres, the market remains at a Gare du Nord Paris Shopping centre 82,000 sq m 2017
good level, despite an annual decline
by 3% of the volume invested. Court'In Vaucluse Shopping centre 22,700 sq m 2016
The market remains constrained
by an ever decreasing supply of Open Sky Plaisir Shopping centre 37,000 sq m 2018
quality product and by rising prices.
There is a rising number of deals Cap 3000 Alpes-Maritines Shopping centre 90,000 sq m 2018
between €100m and €500m, which
Bleu Capelette Marseille Shopping centre 42,500 sq m 2018
characterise the market (at 67% of
the amount invested). Source: Savills
savills.com/research 013Market report | European retail
Germany Thomas Pasiecznik Jörg Krechky Matthias Pink
Germany Retail Agency Germany Retail Investment Germany Research
+49 211 22 962 260 +49 40 309 977 144 +49 (0) 30 726 165 134
tpasiecznik@savills.de jkrechky@savills.de mpink@savills.de
Retail Trends 27%. This is the result of limited 6.3% for retail warehouses. As there
PRIME YIELDS *
Germany’s economic outlook is supply of investment opportunities is an extremely strong competition
2016 and 2017
fairly stable and resilient. Growth in terms of shopping centres and among bidders for attractive retail
OUTLOOK
is expected to continue, at 1.7% prime high street buildings, which parks and shopping centres in
this year and 1.4% for 2017. The has also caused a shift towards secondary locations, further marked SC Q4 16 4.1%
unemployment rate is one of the alternative segments like retail parks, yield compression in such locations is
lowest in Europe at 5.9% and supermarkets, discounters and DIYs expected.
consumer sentiment is robust. throughout the last years. However, Overall retailer demand is stagnating HS Q4 16 3.5%
International retail chains, attracted with high-value product remaining and this will likely result in rising
by the dense, high purchasing scarce, the overall transaction vacancies apart from top retail
power in Germany, are looking for volume will fall significantly short of locations. Rental growth, if at all,
prime high street locations in order last year’s total. can only be expected in absolute
to expand. Suburban areas as well top locations. Secondary/tertiary
as secondary retail locations have Rents and Yields locations, particularly those where
remained fairly stable over time. Prime net initial yields for retail fashion retail dominates, might suffer *Average for top
from rental decreases. ■ seven markets
properties range between 3.6% for
Investment and prime high street properties and
Development
With 123.1m sq m of retail space, GRAPH 6
Germany has the fourth largest per
capita retail space in Europe. As
Berlin and Munich retail yields
some regions particularly in Eastern Prime SC yields Berlin Prime HS yields Berlin
Germany are oversupplied, planning
Prime SC yields Munich Prime HS yields Munich
authorities have become more 6%
protective of the local retail sectors
and try to enforce sustainable 5%
development in their communities.
Therefore, the stock of retail space
4%
has increased more moderately
over the last decade, at an average
3%
rate of approx. 1m sq m per annum.
New development concentrates on
2%
relatively undersupplied but well
performing retail segments, such as
factory outlet centres in peripheral 1%
and easily accessible areas. Also,
inner-city retailing has regained 0%
popularity over the past few years. 2011 2012 2013 2014 2015 2016 Q3
Investment in the German retail Source: Savills
property sector has proven to be
a safe and sound choice, even
during the years post the global TABLE 6
financial crisis. In light of this Major shopping centre developments
potentially stabilising effect on
investor portfolios, retail property Property Location Type Size (GLA) Opening
remains extremely sought-after
among investors. However, with Mall of KuDamm Berlin Multifunctional centre 65,000 sq m 2020
a transaction volume of €9.0bn
the retail investment market has Überseequartier Hamburg Multifunctional centre 80,000 sq m 2021
witnessed a significant decline of
45% yoy during the first nine months
Stadtquartier
of the year. Still, it represents the Bochum Multifunctional centre 30,000 sq m 2019
Viktoriastr.
second largest segment behind
office properties with a share of Source: Savills
014December 2016
Greece Dimitris Manoussakis George Veinoglou
Greece Investment Greece Research
+30 210 6996 311 +30 210 6996311
dman@savills.gr g.veinoglou@savills.gr
Retail Trends Investment and from €100 per sq m/month to €150
PRIME YIELDS
The contraction of the Greek Development per sq m/month. In Athens, the
2016 and 2017
economy in conjunction with the During the last couple of years most achievable yields for well-located
OUTLOOK
overall burdensome economic and transactions, have been carried and successfully run shopping centre
political environment have had out by the two largest domestic schemes range between 7.25%- SC Q4 16 7.5%
an immediate impact on private REITs, Grivalia Properties and NBG 7.75%. although this range may
consumption, which has been Pangaea. Combinedly they have be higher, between 8.00%-8.75%,
decreasing from 2007 to 2013. In invested a total of €230m. for retail schemes in out-of-town HS Q4 16 6.25%
2014 private consumption increased locations. In the case of smaller, high
for the first time since the beginning Rents and Yields street retail properties for which there
of the economic crisis by 0.5% Currently, rental levels for units are limited investment opportunities
yoy, and further increased by 0.3% of 101-250 sq m in the Northern and higher demand, yields may
in 2015 yoy. However, this trend Precinct’s shopping centers are decrease to 6.0%-6.5%. Prime
appears to be short lived as in 2016 in the order of 50-70€ per sq m/ achievable yields for units in the best
private consumption is expected month, while rents for prime retail high streets, such as Voukourestiou
to contract by 1.1% yoy despite units on Ermou Street, Athens’ and Ermou streets, can be as low as
the efforts of retailers to attract most prestigious high street, range 5.0%. ■
consumers with sales and special
offers. Decreasing retail sales GRAPH 7
volumes have led to a number of
retailer insolvencies over the past Athens retail rents and yields
five years, especially in the small- Prime SC rents Prime HS rents
medium size market segment but Prime SC yields Prime HS yields
also in the large scale segment 2,000 10%
while few international retailers have
exited the market. Most retailers
9%
are adopting a cautious approach, 1,600 8%
primarily rationalising their operations
Euro per sqm/year
7%
and concentrating on the best
performing areas. At the same time 1,200 6%
we have also noticed the entrance 5%
of firms such as Forever 21 and the
800 4%
willingness of firms like Dekathlon to
enter the market. Leroy Merlin has 3%
also continued its expansion with a 400 2%
new store. Another new entry in the
market is that of Jysk, the Danish
1%
household goods retailer that opened 0 0%
four big boxes in H2 of 2015. 2011 2012 2013 2014 2015 2016 Q3
The decline in sales has been steeper
Source: Savills
on high streets, while established
shopping centres saw a drop TABLE 7
between 7-8% per annum. There is Major shopping centre developments
evidence of on an undergoing trend,
which is moving away from the Property Location Type Size Opening
smaller scale unit format, destined
to serve the local population, to the Academy Gardens Attica / Kantza Shopping centre 55,000 sq m 2020
modern and larger scale format.
This conversion is also induced by
Votakinos Mall Athens Shopping centre 48,000 sq m 2019
international retailers who primarily
seek for larger scale, modern, newly
developed or refurbished retail units, Golden Hall Athens Shopping centre 13,000 sqm extension 2018
including shopping centers and big
boxes. Source: Savills
savills.com/research 015Market report | European retail
Ireland Larry Brennan John McCartney
Ireland and Europe Retail Ireland Research
+353 1 618 1302 +353 (0) 1 618 1427
larry.brennan@savills.ie john.mccartney@savills.ie
Retail Trends have risen by 3.5% in the past shopping centre yields have halved
PRIME YIELDS
Jobs creation, increased household twelve months and currently stand over the past five years and are
2016 and 2017
disposable incomes and resurgent at approximately €3,000 per sq m. currently at 4.5%, stable for the last
OUTLOOK
consumer credit are helping to Prime shopping centre rents have five quarters. Prime high street yields
sustain a broadly based improvement increased by close to 6% and are have also stabilised at 3.5%. ■ SC Q4 16 4.5%
in the retail economy. Although now in the region of €2,750 per sq m.
increased political uncertainty Due to a general shortage of space,
looks to have dampened consumer particularly of larger units, prime HS Q4 16 3.5%
sentiment, the continuing strength inner-city locations are projected to
of the underlying macro-economy remain landlords’ markets.
and the favourable macro-economic The sharp rise in investor demand
forecasts suggest that any headwind for retail assets has translated into
from this source is likely to be rising prices and significant yield
temporary. While sales volumes compression. Prime achievable
are rising, prices in most sectors
continue to fall. However, this does GRAPH 8
not imply that retailers’ viability is
being squeezed – lower commodity
Dublin retail rents and yields
prices, reduced overheads and
efficiency gains have made it
Prime SC rents Prime HS rents
possible for shopkeepers to cut Prime SC yields Prime HS yields
prices at the till. But the fact that they 3,000 10%
are being forced to pass these gains 2,750 9%
on to price-conscious consumers 2,500
8%
Euro per sqm/year
confirms just how competitive the 2,250
sector remains. 7%
2,000
1,750 6%
Investment and 1,500 5%
Development
Retail’s share of investment turnover 1,250 4%
has risen sharply over the past 1,000
3%
year, from 24% in the opening 750
three quarters of 2015 to 46% over 2%
500
the same period in 2016. With the 250 1%
economic recovery continuing to 0 0%
percolate from the corporate sector
2011 2012 2013 2014 2015 2016 Q3
to the consumer economy, vendors
have brought a greater number of
retail assets to the market, some of Source: Savills
which have achieved strong prices.
These include Blanchardstown TABLE 8
Centre in west Dublin which sold for Major shopping centre developments
€950m in Q2 of this year. However,
while investors are now clearly Property Location Type Size Opening
buying into the retail recovery
story, it is difficult to ascertain if the Liffey Valley Plaza Dublin Shopping centre 22,000 sq m Spring 2019
investment upsurge in 2016 is a
distinct trend or simply a reflection of The Capitol Cork Shopping centre 3,700 sq m Mid 2017
the opportunities that have arisen.
Florentine S/C Wicklow Shopping centre 11,000 sq m End 2018
Rents and Yields
With vacancy falling, and
Source: Savills
development only starting to re-
emerge, prime high street rents
016December 2016
Italy Marco Montosi Cristina Taccagni
Italy Investment Italy Research
+39 02 36006749 +39 02 3600 6747
mmontosi@savills.it ctaccagni@savills.it
Retail Trends compared to primary cities, is compression may be experienced in
PRIME YIELDS
The positive trend of economic attracting international investors. secondary cities. Prime net yield for
2016 and 2017
recovery has been confirmed in shopping centres in northern Italy,
OUTLOOK
2016, even if moderate. Analysts Rents and Yields especially Milan, are experiencing
expect the economy to grow by The high street market is dominating further compression reaching SC Q4 16 5.0%
0.8% yoy both in 2016 and 2017. the retail scene driving deal volumes circa 5% in Q3 2016. Net yields
Although consumer confidence is still and yield compression over the past for secondary shopping centres
cautious, the recent opening of two few quarters. This compression is remained stable at 5.50%. HS Q4 16 3.25%
regional shopping centres in northern mainly driven by a scarcity of product Prime rents in the best shopping
Italy, highlights the positive climate and huge demand from property centres in Milan region have been
for Italian retail market, particularly investors. We believe that prime rising over the past two years
in densely populated and affluent yields in the sector will settle for reaching circa €850 per sq m/year. ■
regions. In addition, top international 2016 in the region of 3.25% in Milan
brands have entered into the Italian and Rome. Further material yield
market, such as Primark, in Arese
and Johnny Rockets, an American GRAPH 9
restaurant franchise, in Brescia.
Milan retail rents and yields
Investment and
Development Prime SC rents Prime SC yields
Since the beginning of the year Prime HS yields
circa €1.8bn of retail deals were 1,000 10%
registered, already exceeding last 900 9%
year’s total and confirming the strong
investor appetite for this sector. 800 8%
Euro per sqm/year
Retail investment increased by 700 7%
circa 15% yoy over this period and
600 6%
represented 35% of total investment
activity. Investors continue to show 500 5%
preference in prime retail assets 400 4%
located in primary and secondary
cities such as Milan, Rome, Bologna 300 3%
and Turin. European investors are the 200 2%
most active group with increasing
100 1%
interest from national players,
especially for high street products. 0 0%
The high street sector had a 2011 2012 2013 2014 2015 2016 Q3
particularly dynamic year with circa
€585m invested in Q3 2016, almost Source: Savills
reaching the same investment
level of full year 2015. The resilient
characteristics of high street assets, TABLE 9
with stable and lately rising rents, Major shopping centre developments
low vacancy rates and constant
demand from retailers make it Property Location Type Size Opening
an attractive asset class. Tier 1 Adigeo Shopping Verona Shopping Centre 42,000 2017
touristic destinations such as Venice Centre
and Florence are highly sought
Orio Centre Bergamo Shopping Centre Extension 35,000 2017
after and investment appetite for
such destinations, especially from
Westfield Milan Segrate (Mi) Shopping Centre 70,000 2020
European Institutional Investors, is in
line with Milan and Rome. High street
product in secondary cities such as Source: Savills
Bologna and Turin also experience
growing interest. Lower competition
savills.com/research 017Market report | European retail
Netherlands Jan de Quay Jeroen Jansen
Netherlands Investment Netherlands Research
+31 (0) 20 301 2030 +31 (0) 20 301 2094
j.dequay@savills.nl j.jansen@savills.nl
Retail Trends Netherlands and extended by 25,000 Rents and Yields PRIME YIELDS *
The Dutch economy has been sq m to a total of around 100,000 sq While retail sales improve, the 2016 and 2017
growing steadily over the past three m. Also worth mentioning is the 2017 vacancy rate (7.3% mid 2016, source OUTLOOK
years and forecasts are positive extension of the Batavia Stad factory Locatus) combined with the general
as well. As a result, consumer outlet centre by another 45 outlets. shake-up of the retail market in the SC Q4 16 5.25%
confidence is positive (+8, highest Investment activity in the retail Netherlands, keeps a downward
post-recession figure) and retail sector was just below €1.25bn in pressure on rents except for a limited
spending increases (+1.5% yoy in the first three quarters of the year set of prime retail destinations. HS Q4 16 3.75%
August 2016). It has to be noted that corresponding to 21% of the total Yields on the contrary remain low
some sectors profited more (clothing, activity, and was down about 28% and stand at 3.75% gross for prime
DIY, home furnishing) than others, yoy due to the scarcity of prime high street yields, 5.25% for prime
notably consumer electronics with assets and portfolios. shopping centres and 6.75% for retail
a decrease of 6.8% yoy. This very warehouse centres. ■
much has to do with the fierce online
competition within this segment.
Online sales as such continued to
grow by double digits (+17% yoy in GRAPH 10
August). Pure players showed larger
growth (22%) than the online sale of
Amsterdam retail rents and yields
multi-channel retailers (+11%).
The effects of lower retail spending Prime SC rents Prime HS rents
in past years combined with a shift
Prime SC yields Prime HS yields
towards online retail, still leads to
3,000 10%
insolvencies, however, a year-end
forecast by ABN Amro suggests 2,700 9%
the lowest rate since the start of 2,400 8%
the recession. The insolvencies
Euro per sqm/year
2,100 7%
also opened up new opportunities.
Expanding retailers like Hudson's 1,800 6%
Bay, Topshelf, Primark and 1,500 5%
Decathlon, opened at vacated V&D
department store locations. This will 1,200 4%
overall lead to increased gross take- 900 3%
up figures by the end of this year. 600 2%
The recent introduction of same day
delivery by online retailer Bol.com 300 1%
will further increase the competitive 0 0%
power of this brand and e-commerce 2011 2012 2013 2014 2015 2016 Q3
in general. Within the shopping
streets this is countered by retailers
Source: Savills
investing in their store formats (e.g.
Blokker, Hema, Bristol) in order to TABLE 10
remain competitive. Major shopping centre developments
Investment and Property Location Type Size Opening
Development
New retail developments are 35,000 sqm extension
Hoog Catherijne Utrecht Shopping centre 2017
(total 102,000 sq m)
limited and generally concern
redevelopments and/or extensions Leidsche Rijn Centrum Utrecht Shopping centre 22,400 2018
of existing schemes. Among them
Hoog Catherijne in the centre of Leidschendam- 40,000 sq m extension
Mall of the Netherlands) Shopping centre 2019
Voorburg (total 116,000 sq m)
Utrecht, Stadshart Amstelveen and
5,500 sq mextension
shopping centre Leidsenhage. The Batavia Stad Leleystad Factory outlet 2017
(total 31,000 sq m)
latter will be rebranded Mall of the Source: Savills
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