Retail Market_tipar.qxp

Transcription

CB RICHARD ELLIS $ EURISKO $ ROMANIAN RETAIL MARKET
In one year time many things have
changed inside the retail market in
Romania. We can name the following:
the successful opening of some new shopping centers (for example: Baneasa
Shopping City, Era Shopping Park Ia[i,
City Park Constan]a), the presence of new
retailers on the Romanian market (most
Inditex brands, Next, Peek&Cloppenburg,
Luiza Moraru
New Yorker, Douglas Perfumery,
Head of Retail Department
Reserved, Humanic), the announcement of
new and very interesting projects (Allegria Mall Pite[ti, Festival
Mall Sibiu, Roua Shopping Park Bra[ov).
In the same time some have raised questions of whether the
Romanian retail market can resist such rapid change in such a
short period. In this context several announced projects still do not
have a definite opening date (Esplanada, Colosseum) while other
projects will never get passed the stage of "paper projects" (Mall
of Romania in Sema Park is one of the most resonant and recent
example). We predict that only 50 - 60% of the total shopping
centers presented until today will actually be opened. The rest will
either be re-designed, transformed or they will not even be built.
In all cities, with the exception of Bucharest, there will be only one
dominant retail center which will have the following characteristics:
more than 30,000 sqm for a city with 100,000 to 200,000 inhabitants and over 40,000 sqm for a city with over 200,000 inhabitants. The prevailling project will also benefit from: the best location (in the center of the town), a large array of anchors, the most
attractive and innovative design, the best merchandise and tenant
mix, adapted to the local demands and an excellent property
management team.
Whitin this brochure CBRE Eurisko research team has put the focus
on retailers and their expansion plans in Romania. Even though a
number of retailers have expressed their concern regarding this
agressive expansion because it may not be sustainable on the
medium term, others are willing to open more and more stores.
An evidence to the succes of international brands in Romania is
the record selling opening figure registered by Next store in
B\neasa Shopping City - the best opening within the worldwide
network in the last three years.
Romania is located in the South-Eastern part of Central Europe and
is bordered by Moldova and the Ukraine to the North-East, Bulgaria
to the South, Serbia to the South-West, Hungary to the West, and
the Black Sea to the South-East. Romania's total surface is of
237,500 sqkm. As a consequence of its location and history
Romania is a mix of cultures, diverse ethnics and varied geography.
Romania's total population is of 21.53 million (as of 1st of July
2007). The population has decreased in the last years with aprox
0,2% every year. In the period 2002 - 2007 the population
dropped by 268,000 persons, while in the period 1992 - 2002
the total population decreased by 1,1 million persons. Probable
causes for this are: intense foreign migration, a drop in birth rate
and a rise of mortality rate.
Because of the fact that the number of deaths out-weighs live births
and the migration continues to increase, the population of
Romania will probably continue to decline to an estimated under
20 million in 2020. The prediction for 2050 shows that Romania
will have around 17 million people, or just 80% of the total population in 2006 (according to Eurostat). Out of these, the majority,
55.2% live in urban areas (municipalities and towns) while 44.8
live in rural areas.
Population density in Romania is 90.8 people per sq km, is below
the average for Central and Eastern Europe (106 people per sq
km). There are 41 counties in Romania, of which 9 have a population density figure over 100. Bucharest is, by far, the most
densely populated municipality in Romania, with 8,114 people
per sq km.
From the total population of Romania, women account for 51.3%,
while there are only 48.8% men. In Bucharest, the rate is even higher in women's advantage, with only 46.6% men and 53.4% women.
Romania is one of the most populated countries in the area,
ranked three behind Turkey and Poland, as shown after.
The last demographic census shows that the age profile has become
older over the last 10 years, with the 0 - 14 and 15 - 24 categories
decreasing and the 65+ category registering a significant increase.
Figure 2 shows the age structure of Romania's population in 2006.
Source: Eurostat 2007
The Romanian National Institute of Statistics estimates that the proportion of those in the active population (15 - 64) age group are
going to remain constant within the following years, varying from
66% in 1990 going to 69.7% in 2007, and start a notable
decrease trend after the year 2010.
Source: INSSE, 2007
In 2007, there were only 4 cities in Romania with more than
300,000 people, excluding Bucharest:
Source: INSSE, 2007
2008 is an electoral year in Romania, with both local and parliamentary elections to be held and for the first time an uninominal
voting system will be used. In June 2008 the local elections were
held with the following results: Social Democratic Party (PSD) won
the most mandates (35.79%), while Democrat Liberal Party (PDL)
won 28.56% of the mandates and National Liberal Party (PNL) won
22.20 of the mandates. In Bucharest the new mayor is Sorin
Oprescu, an independent candidate, a former vice-president of
PSD. Several major cities have re-elected the previous mayor:
Constan]a with Radu Mazare, Bra[ov with George Scripcaru, Cluj
Napoca with Emil Boc, Sibiu with Klaus Johannis, Timi[oara with
Gheorghe Ciuhandu.
The parliamentary elections will be held on 30th November 2008
and the most important candidates for the position of prim-minister
are: Calin Popescu Tariceanu from PNL, Theodor Stolojan from PDL
and most probably Mircea Geoana from PSD.
Romania was an associate member of the European Union from
1995, began formal EU accession negotiations in 2000 and became
an EU member starting with the 1st of January 2007. Romania is
also a NATO member since 2004, after negotiations were started in
November 2002. In 2008 the NATO Summit, the organizations most
important annual meeting, was held in Bucharest, Romania.
The first semester of 2008 was a record breaking period in terms of
economic growth - the GDP rose by 8,8% in comparison with the
same period of 2007 reaching a figure of RON 195.7 billion. This
is the biggest economic growth for the first 6 months of an year
since 1989.
Even though the first decade after the revolution was a period of
consistent decline in economic activity (signifying, among others,
one of the highest rates of inflation and the lowest income levels in
the region). However, during the last period things started to
improve in all sectors, year by year as shown in the table below.
Source: INSSE, National Bank of Romania
Note: * National Prognosis Committee and Romanian Agency for Foreign Investments estimates
While the government focuses on economic reforms according to the
requirements of the EU standards, the economy has registered a
constant growth (furthermore, current growth rates in GDP and consumption outperforming many of the major Western European countries). Although consumption and GDP per head are lower than the
regional average, and considerably lower than EU levels, the consumer sector is expected to continue evolving, especially given the
projected fall in unemployment.
Considering the above presented economic figures, we believe that the
major developers as well as the international retailer chains will find
the Romanian market increasingly attractive as the average net monthly wage is expected to increase, as shown in the chart on page 11.
The GDP per capita in Romania registered a 22% increase from
EUR 4,500 in 2006 to EUR 5,500 in 2007, while the European
average is of EUR 24,700 according to the Eurostat.
For 2008, the European Union Statistics Institute estimates that the
GDP per capita in Romania will reach EUR 5,900, a 7.2% increase
compared to the previous year.
In 2007 Romania was the 17th economy of the 27 countries within
the European Union with a total of EUR 118 billion in terms of GDP
and the Eurostat estimates that in 2008 Romania will keep the same
position despite a slight increase reaching EUR 127 billion. For comparison the Czech Republic will have EUR 141 billion while
Hungary will register a total GDP of EUR 108 billion.
According to the National Prognosis Committee the GDP per capita
in Bucharest was of EUR 11,290.5 in 2007 and is expected to grow
to EUR 13,086.1 in 2008, reaching EUR 16,529.7 in 2010.
The country's inflation rate and the economic growth have improved
during the last decade compared to the early 90's, showing that the
economic recovery is a fact, although the EU standards are to be
reached in the near future. The negative records for the annual inflation rate registered in 1997 (151.4%), 1999 (54.8%) or in 2000
(40.7%) are history now. In 2007 the inflation rate was of 4.84%,
according to NIS, and the prevision for 2008 is of 7%. The consumer price index rose in 2007 with 6.57% compared with 2006,
while for this year the prediction is of 5.4%. At a EU level the inflation rate was of 3.2% in 2007.
The volume of direct foreign investments in Romania in 2007 was of
EUR 7.2 billion, compared with EUR 9.05 billion in 2006. During
the first semester of 2008 the FDI reached a sum of EUR 4,75 billion
which means that for the entire year 2008 FDI will reach a volume
of EUR 10 billion. In Romania is ranked second, after Poland as the
destination for foreign investors out of the 10 new EU member countries. The figure is a consequence of the large greenfield investments
in Romania, an area where we are leaders in the region.
In the North-Eastern part of Romania the main industries are: steel
and naval industries in Galati and Braila (ex: Mittal Steel); textile
industry (Brainconf, Ia[itex, Textila SA, Akrom Akal); wine production (Cotnari, Vie Vin Export); wood and furniture industry
(Moldomobila, Ecopack, Letea SA); construction industry
(Arabesque, Dedeman, SSAB, Conex); food industry (Agricola,
Pambac, Pakmaya).
The main industries in the Southern region are: automobile industry
with investments made by Daewoo, Ford, Renault and Auto Chassis
International in Craiova and Pite[ti. The most well known investors
for this industrial branch are Renault and Ford. Renault, the french
automobile manufacturer is predicted to make an investment of over
EUR 2 billion in the production complex in Pite[ti, Arges county by
2008. Ford has bought the former Daewoo plant and it is predicted
that by the end of the year Ford will start the investments, evaluated
at EUR 672 million; the number of new jobs offered by Ford will
exceed than 5000. The food and beverages industry represented
by Topway, Brewery Craiova, Caroli, Coca Cola, Vel Pitar and
Boromir in Craiova, Ploie[ti and Ramnicu Valcea; chemical industry
Transylvania is renowned for the following industrial branches: automobile industry (Roman SA, Autoliv, Ina Schaffler, Lisa Draexlmaier);
food industry (Kraft Foods, Wrigley, Kandia Excelent); textile industry (Steilmann, Mondex, Rosko Textil); food and beverages industry
(Friesland, Diamant, Coca Cola, Loulis, Interbrew);
IT&Communications (Nokia, Route 66, UPC); white goods industry
(Electrolux).
Unemployment rate in June 2008 was of 3.8%. Unemployment has
been declining steadily across Romania over the past 5 years, mainly in Bucharest (according to NIS). National Prognosis Committee
announced that for the year 2008 the entire year the unemployment
will be around 4.1%.
Source: National Prognosis Committee, 2007
In June 2008 the national net medium income per month was RON
1273 (approx. EUR 350), according to the National Institute of
Statistics. The net medium income in June 2008 was 4,312 times
higher than the net medium income in Jan. 1990. It is widely
believed that monthly income in Romania and also in Bucharest are
higher that the official figures as people supplement their income
with black market activities or just do not declare their full earnings.
represented by Unilever in Ploie[ti; oil industry with companies like
Petrom and Rompetrol in Constan]a and Ploie[ti.
The black market economy in Romania accounts for 25% to 30% of
GDP (National Bank of Romania, Institute for Life Quality Research).
Generally black market activities can range from illegal street trading to employers not declaring employees actual earnings. However
the retailing sector benefits from this as people have more to spend
on consumer goods and services.
The number of foreigners entering Romania grew by 25.8% in the
first seven months of 2008, compared with 2007, reaching a figure
of 4.9 million people (Source: National Institute of Statistics). The
majority of foreigners came from European Union, out of which
34.6% were Hungarians, 20.8% were Bulgarians, 9,2% were germans, while Italians represented 7,6%. The number of Romanian
tourists visiting foreign countries grew by 25% compared with 2007,
reaching a number of over 700,000 people. Even though the number of foreign tourists grew at a national level, the number of foreigners who visited the Romanian seaside dropped by 20% in 2008
compared with the same period of 2007. Last year was the best
year for summer tourism since 1989. More than 900,000
Romanians chose to spend their holiday in other regions of
Romania, like Prahova valley, Bra[ov and Poiana Bra[ov, North
region of Moldavia. Due to increasing investment in the tourist and
business traveller sector the touristic infrastructure is continuously
growing, even if at a slow pace. The number of 3.4 and 5 star
hotels is rising (mostly in Bucharest), with franchises like Ibis, NH
Hoteles, Golden Tulip, Best Western, Howard Johnson, Radisson
SAS, Novotel, K+K etc and local hotels like Carol Park Hotel.
The registered level of car ownership in Romania is of 1 car for 6
inhabitants (by the end of 2006) one the lowest level in Europe. The
European Union average is of 1 car for 2 inhabitants. In 2007,
Romania, for the second year, was the biggest market for sold cars
in East and Central Europe. The total number of new passenger cars
sold was 315,621. However in Bucharest there are estimated to be
1,000,000 cars in the city (including non resident drivers), giving a
figure of approx. 1 car for 2 persons.
Source: Eurostat, 2006
Since 1990, the process of privatisation encouraged a vast number
of small and medium-sized retail operations, with the majority being
single outlets. Small entrepreneurs focused mostly on trade rather
than production, and the distinction between retail and wholesale
was blurred. The firms had limited access to business financing and
most made only slight attempts to modernise their equipment. This
structure resulted in a great number of outlets, most of them only simple kiosks or street traders, which did not have the power or market
knowlege to survive. The number of outlets registered in 1996 and
1997 represented in fact artificial amounts of retail businesses.
Since 2000 there has been a major battle between the major retailers that penetrated the Romanian market, mostly in the mid-1990s
and which have had seen positive growth ever since, and the small
retail businesses, the so-called "boutiques" (small outlets: general
stores, kiosks). This struggle for supremacy tends to be won by the
big retailers which only in 2001 increased their sales by 75% compared to 2000, and this has become a general trend in all of
Eastern Europe.
The local retail market has become a battlefield for approx. 300
modern retail premises all belonging to national and international
retail chains, almost 20% these being operational in Bucharest,
according to MEMRB.
To date in Romania there are 38 hypermarkets, 123 supermarkets,
195 discount stores and 40 cash&carry units (according to
MEMRB). The sales per sqmeter for the top international retail brand
in 2007 (according to Business Standard):
The luxury car market
is growing exponentially
in Bucharest, a city
where are registered
over 50% of the new
sold cars in Romania.
The high car ownership
figure in Bucharest is
an indication of wealth,
with those having one
in their possession
having a higher disposable income.
!
"
The total value of the FMCG Romanian market in 2007 was of EUR
41 billion, estimated to reach EUR 43 billion in 2008 and EUR 48
billion in 2009 (according to MEMRB). Another company (Deloitte
Romania) suggests that the total value of the retail market in
Romania will reach EUR 100 billion by 2010. A study made by
Planet Retail shows that in 2013 the tradition retail units will have a
market share of just 59%, followed by hypermarkets with 21.5%,
cash&carry units with 8.6%, discount shops with 4.7% and supermarkets with 5.2%.
The market share of modern retail units out of the total retail market is of 40% at a national level and 70% in Bucharest. By comparison in Germany and France modern retail accounts for over
95.5%, while in Poland and Italy it represents around 55 - 60%
(according to MEMRB).
In Bucharest, for example, hypermarkets attract the main shopping
budgets for 2 out of 3 shoppers, while in smaller towns the supermarkets, discount shops and local grocery shops are preferred by
consumers. Compared with other countries in the region, Romanians
spend the most money on fresh food products, around half of the
monthly expenditure. Also, another Romanian characteristic is that
shoppers are not yet loyal to a certain shop, they visit around three
different brands each month, paying attention to marketing activities,
interior design, accesibility and, of course, prices. Four out of five
shoppers express the pleasure of going shopping (source: MEMRB).
The food market is evaluated at EUR 18.3 billion, a 27.8% increase
compared to 2006. The figures for Bucharest (where the modern
retail prevails as compared to the traditional form of retailing) are
much higher than in any other city in Romania.
The supermarket segment in Romania is dominated by Billa, part of
REWE group, with 30 units, followed by Carrefour Express with 21
units. Billa is a very aggressive player on the market, its goal being
the opening of over 170 units in Romania by 2010. It is a network
opened to acquisition (so far it bought only 2 units in Baia Mare)
and it is very flexible regarding the size of a unit (ranging from 700
bought in 2007 the Artima network (a transaction evaluated at EUR 55 million) and has re-branded 17 out of the 21 units
under the new logo Carrefour Express, at a cost of EUR 6.3 million.
It plans to rebrand the remaining shops until the end of this year
and to open other 10 units in 2009. An average Carrefour Express
unit has around 1,000 sqm sales area.
, part of Delhaize Group has become the most
important player in Bucharest, after buying the La Fourmi chain,
reaching 34 units in Bucharest alone and 3 units outside Bucharest
(two in Constan]a and one in Ploie[ti). Mega Image paid EUR 18.6
million for the 14 La Fourmi supermarkets and will further invest in
the re-branding and re-marketing process. It plans to open another
5 units in 2008. An average La Fourmi unit had around 400 sqm
sales area.
is another important player, mostly in Bucharest (22 units)
and in Transylvania region. It started out as a small shop where only
the Angst meat products were sold, but in time it evolved into a regular supermarket. The average size of an Angst unit is around 300
sqm - 500 sqm.
Source: CBRE Eurisko according to press releases
Taking into consideration the sales figures the leader on the market
is Carrefour, who announced a sales figure of over EUR 866 million
in 2007 and plans to reach a figure of EUR 1 billion in 2008 (durhas reported a sales
ing the first six months of 2008
figure of EUR 427.1 million, a growth by over 40% compared to
the same period of last year. Carrefour operates 16 hypermarkets
in Romania, with 5 located only in Bucharest. Carrefour has
announced that it plans to operate around 40 hypermarkets in
Romania by 2012. For example one of their units: Carrefour
to 1,500 sqm sales area, but with units having only 300 sqm). Billa
will open units within shopping malls (the first one is located in City
Mall Bucharest) and other locations planned are: Liberty Center
Bucharest, Atrium Center Arad and Atrium Center Cluj Napoca.
Orhideea was the third best operating hypermarket inside the
Carrefour network at world-wide level, surpassed only by two units
from China. To date Carrefour Feeria is registering high figures in
terms of number of clients, similar to the ones from Orhideea. The
average sales area size of a Carrefour hypermarket ranges from
6,500 sqm to 8,000 sqm.
,
By number of operating hypermarkets the leader is
part of Lidl&Schwarz Group with 32 units in Romania. It plans to
open at least one unit in each county and to open another 7 units
in Bucharest alone, the final goal is to have 50 units throughout
Romania by 2010. In 2006 the turnover for Kaufland Romania was
of EUR 232 million. An average Kaufland unit has around 6,000
sqm to 7,000 sqm sales area. According to a GFK study,
Kaufland is the leader of the local retail market with a 3.9% market share.
, part of Metro Group, is one of the most dynamic players
on the market with 7 new opening planned for 2008. It has 16
units in Romania, out of which 2 are located in Bucharest. The
average sales area of a Real hypermarket is between 6,500 sqm
to 8,000 sqm. The turnover reported for 2007 was of EUR 367
million. The hypermarket located in Vitan area, Bucharest brought
several new ideas to the Romanian market - the unit is opened
24/7 and it has a very complex wine section.
, part of Louis Delhaize Group, has only 3 hypermarkets in
Romania and plans to open another 2 in Romania. The average
Cora hypermarket has a sales surface around 12,000 sqm to
15,000 sqm (similar to that of Auchan that has 4 operational units
to date in Bucharest, Pite[ti, Cluj Napoca and Târgu-Mure[, plus a
small unit in Timi[oara ).
is the only 100% Romania chain of hypermarkets with 4 units
in Romania and plans to open another 2 in 2008 within retail
parks. The owners of PIC group, Penescu brothers, announced that
the future strategy is to open only in retail parks units with a lager
surface, around 9,000 sqm to 10,000 sqm.
The most important player is Plus Discount, part of Tengelmann
Group, with 63 units in Romania so far and with an agressive
expansion plan reaching 120 units by 2010. A usual Plus unit has a
sales surface of 1,000 sqm and offers a variety of 1,500 products
ranging from fresh food, frozen food as well as non-food products.
Plus Discount SCS Romania registered a turnover of EUR 126.5 million in 2006. Tengelmann planned to sale the PLUS network in
Romania (like it did in the Czech Republic were it sold the 146 Plus
network to REWE), but in the end decided to keep decisional control
of the chain (Carrefour was among the potential buyers).
REWE group operates two types of Penny Market units in Romania
- the normal Penny, with a sales surface of 750 sqm and Penny
Market XXL with a larger surface, usually over 1,500 sqm (until
2007 the larger units were called XXL Mega Discount). In 2007
Penny Market registered a turnover of EUR 253.7 million, an
increase by almost 40% compared to 2006. The most important
opening in a shopping center is the opening of a Penny Market
XXL within Unirea Shopping Center Bra[ov.
Profi, part of Louis Delhaize Group, was the first discounter to
enter the Romanian market in 2000. It now operates 50 stores,
including the former Albinu]a stores in Romania and one in
Bucharest. The averages store has a sale surface of around 500 sqm
and it trades around 4,000 products. Profi plans to open another
8 stores in 2008 and to rebrand the 9 Albinutza supermarkets (a
local chain bought in 2007 from Maxima LT for EUR 7,5 million).
In 2007, Profi Rom Food, the company operating Profi network,
had a sales figure of EUR 65.5 million, a rise by 47% compared
with 2006. In the same time the company announced a financial
loss of EUR 1.4 million.
operates 23 units throughout Romania to date and reported
in 2007 a turnover of EUR 1.59 billion, by far the largest turnover
registered by a retailer in Romania. The network is 85% owned by
Metro cash&carry and the other 15% belong to Ion Tiriac. Metro is
also the first international retailer to enter the Romanian market,
back in 1996.
has 17 units in Romania, mostly in the same counties
where Metro is present. It registered a turnover of EUR 800 million in
2007 and plans to reach a EUR 1 billion in 2008. The average sales
surface is 10,000 sqm and the store offers over 42,000 products.
All segments of the modern food retailling are expanding their store
portfolio and are trying to secure new locations or to consolidate
their existing shops in order to respond to customer demand.
If the number of discount stores almost doubled in the last 12
months, hypermarkets renewed their expansion strategy and opened
new stores in shopping centers or retail parks, while cash&carry
networks chose to strenghten the current stores and not to open
new ones.
The cash&carry units dominated the food segment in 2007 with a
13% market share. There are only 2 players on this market Metro,
part of Metro Group and Selgros, part of REWE group. Most
cash&carry units are located in Transylvania region.
The entire white & brown market and IT market was evaluated at
EUR 1 billion in 2007. The potential of the white&brown market is
of over EUR 3 billion, to be reached by 2012, a moment when the
market will peg.
The brown goods market registered an increase in market share
and sales figure in 2007, a trend most likely to continue in 2008.
The best sold items in this segment were LCD's and Plasma TV's,
followed by gadgets and innovative products. The most important
brands on this market are: Samsung, Philips, Panasonic, Sony
and LG.
The white goods market registered an increase of 18% in 2007
compared to 2006 reaching a value of over EUR 350 million. The
most important brands on this particular market are: Arctic,
Indesit, Zanussi and Whirlpool.
is the leader on the white & brown goods market with a
turnover of EUR 317 million in 2007. During the first 6 months of
2008 the sales figure was of EUR 170 million, a rise by 47% compared with the same period of last year. An Altex store can have a
flexible sales areas ranging from 800 sqm to 2,000 sqm, while a
Media Galaxy unit has over between 2,500 sqm to 5,000 sqm.
The total retail surface is of 90,000 sqm, divided in 70 Altex
stores and 17 Media Galaxy units. Altex has recently signed an
agreement with BelRom to have an Altex store in every European
Retail Park scheme.
is the second player on the market according to
the registered turnover in 2007 (EUR 193 million). It operates 121
Domo stores and 3 Technomarket stores in Romania. It plans to
open another 30 Technomarket units in all major cities of Romania
Domo sold in 2007 75% of the shares to Equest Investments
Balkans for EUR 62.5 milion. A 3,400 sqm Technomarket unit was
opened in 2008 in Vitantits Shopping Center.
, part of Flamingo International has two types of stores:
Flanco and Flanco World, a store with a surface from 1,000 sqm
to 3,000 sqm. The announced turnover for 2007 was of EUR 171
million, while the estimated turnover for 2008 is of EUR 193 million. There are 71 Flanco stores and 15 Flanco World stores.
Flanco will open stores in Sun Plaza, Grand Arena, Esplanada
and Colloseum in Bucharest in the next years. The company plans
to focus its expansion activity through Flanco World, which has
, the fifth player on the market declared bankruptcy in
May 2008 and has closed down all Teknosa and Cosmo stores.
The causes are various: the problems Sabanci Group (the majority
owner of Teknosa) has in Turkey, the country of origin, the problems with the other partner, Primex and the intense competition on
the white&brown market in Romania.
surfaces of over 1,000 sqm. Another brand owned by Flamingo
Group is Flamingo, a store specialized in IT&C and electronics
with surfaces of around 500 - 1,000 sqm.
The sports goods market is evaluated at EUR 160 million.
In Romania there are just 2 international multibrand sports stores:
Hervis and Intersport. Hervis has 3 units in Cluj Napoca (Iulius
Mall), Sibiu (European Retail Park) and Târgu-Mure[ (European
Retail Park) and will open its first unit in Bucharest in Liberty
Center in November 2008. Intersport has 7 units: 3 in Bucharest,
and one in Bra[ov, Constan]a, Pite[ti and Bac\u. Intersport,
brought in Romania through a franchise by Genco company, has
announced that in 2008 it plans to open other 6 locations (mostly
within shopping centers), after the registered turnover for 2007
was 60% higher than that for 2006, reaching a figure of EUR 10
million. The best sold item in the Intersport units are the sports
shoes by Adidas and Nike.
Decatholon has announced that it plans to enter the Romanian
market through its big-size sport store. The first unit is to be
opened in Militari Shopping Center in early 2009.
Adidas has 18 stores in Romania, most of them in Bucharest (7),
while the rest are in cities like: Bra[ov, Constan]a, Râmnicu
Valcea, Oradea, Cluj, Ia[i, Satu Mare, Sibiu and Timi[oara and it
plans to open another 7 stores in 2008. Nike, a franchise owned
by Elmec Romania has 23 stores in Romania, with 9 located in
Bucharest. Puma was brought in Romania through a franchise
owned by Mexxem company, but starting with the 1st of January
2008 Puma has entered directly the Romanian market and plans
to open 5 new independent Puma stores by 2010. A Puma store
will have a surface ranging from 150 sqm to 200 sqm and the
openings are planned only in cities with a population of at least
150,000 inhabitants. Mexxem will transform all the Puma stores it
owns into a new brand - Fr33Zone, offering a wide variety of
products and sports brands.
In Romania mono-brand stores have been very popular, the most
well-known brands being Adidas, Nike and Puma (these 3 brands
top the sales inside the Intersport network as well).
The fashion retail market is developing at high pace as far as
international presence is concerned due to the numerous number
of shopping center projects in Bucharest as well as in most important cities from the province, combined with the economic growth
and the increase of spending power registered only during the
past years. This lateness in arrival resulted from the small purchase
power and the lack of quality retail environment from the late 90's
and mid 2000's. Many of the fashion retailers that have entered
the local market in the past four years are mainly looking now to
secure premises within shopping malls due to high degree of
attraction and to significant footfall figures. Relevant such players
are: Inditex Group (with all its brands Bershka, Oysho, Pull& Bear,
Stradivarius, Zara Home, Massimo Dutti), Takko Fashion, Orsay,
Debenham's, Esprit, Springfield, Humanic, Marks&Spencer,
Stefanel, Benetton, Etam, Kenvelo, Terranova, Mango, Promod,
Next, Reserved, Cropptown etc. As for the footwear market,
Leonardo is a local brand present in almost every major shopping
center in Romania (the group has also shops in Hungary and
Bulgaria and is targeting Moldavia for the next future). Other
important players in terms of number of stores are Benvenuti,
Otter, Ecco, Bata Office Shoes, Pietra, Amely or Il Passo. During
the last year three major international brands present in the CEE
markets - Deichmann, Humanic and New Yorker have leased
premises in Romania.
The following international brands have announced expansion
plans in Romania: C&A, Decathlon, Kiabi, Forever 18, GAP,
Banana Republic, Charles Woegele, Sphera, Glou, Exis Sport
Tchibo Brands.
On the health&beauty segment an important tenant has entered
the market in 2007: Douglas Perfumery, a German retailer with
over 1,000 shops. Other long standing retailers on the Romanian
market are: The Body Shop, Yves Rocher, Sephora.
It is important to mention that some international retailers have
chosen to open their first store in a city different than Bucharest,
due to lack of retail space in the capital city and increasing opportunities and purchasing power registered in the province. Some of
the most powerful examples are: Bershka, Oysho, Stradivarius
(first stores in Polus Center Cluj Napoca), Douglas Perfumery and
Peter Murray in Mures Mall, Târgu-Mure[, New Yorker in Polus
Center Cluj Napoca, Jack Wolfskin in Promenada Mall Sibiu,
Hervis in European Retail Park Sibiu.
Source: CBRE Eurisko 2008
The Romanian cinema market has not yet reached maturity, a fact
noticeable by the limited number of modern screens and admissions.
If in 2006 compared to 2005, the Romanian figures followed their
yearly decreasing trend (1.8% lower in 2006 compared to 2005),
2007 was the first year since 1989 when the total admissions was
higher than the previous year (by 5.4%).
Source: The National Cinema Center - Yearbook Film Production,
Distribution and Exhibition, Romania 2006
In 2007 the total ticket sales in Romania reached almost EUR 10
million for 72 cinemas with 43,057 seats.
There are two major international chains that have announced
important investments in Romania for 2008-2001: the Greek
company Odeon (number two in Greece market) and the Dutch
company Cinema City International (CCI). The first one has
secured locations within Polus Center in Cluj Napoca. Other targeted cities are Pite[ti, Constan]a and Gala]i. The second operator
has already signed contracts for more than ten projects throughout
the country (out of which 4 projects in Bucharest) and is looking to
increase its network in Romania. It has opened two cinemas in Ia[i
and Timi[oara.
So far the strongest player on the Romanian market is dominated
by Hollywood Multiplex, with two cinemas, one in Bucure[ti
Mall (10 screens) and one in Lotus Oradea (5 screens), plus
a single-screen (CinemaPRO). According to the National Center
of Cinematography, Hollywood Multiplex has 47% of the
local market.
Source: The National Cinema Center - Yearbook Film Production,
Distribution and Exhibition, Romania 2007
One of the main reasons for which the foreign international cinema operators are attracted by the Romanian market (besides the
low number of screens for the entire population) is the fact that
the ratio ticket sales per capita is of 0.14, while the one for the
Czech Republic, Poland or Hungary is between 0.8 to 1.15, while
the European Union average is of 2.5. Basically the strategy of
these international operators is based on the huge potential of the
local market.
In Romania there are a limited number of fast-food networks that
have opened stores all over the country. McDonald's, KFC, Pizza
Hut are the oldest such chains on the market. Mc Donald's was the
first restaurant chain to come to Romania in 1995, in Bucharest.
Now their network covers 21 cities and includes some 55 units,
out of which only three are franchises (the ones from Bra[ov), with
a total turnover of EUR 93 million in 2007. Until the end of 2008
other 4 units will be opened, including one in Liberty Center in
Bucharest. For the next 7 years, McDonald's plans to double the
number of its restaurants with at least 8 new openings each year.
The forecast in terms of turnover for 2008 is of EUR 100 million, a
rise by 20% compared with 2007. Recently, McDonald's has
announced that the most profitable restaurants are those in
Bucharest, followed closely by the ones in Constan]a, Bra[ov and
Timi[oara. The top 5 restaurants in Romania gather around 1 million transactions daily.
KFC started their development in Romania in 1997, having 30
units in the country, out of which 11 in Bucharest, 3 in Constan]a
and Ia[i, 2 in Cluj Napoca and one in Bra[ov, Oradea, Ploie[ti,
Craiova, Târgu-Mure[ and Arad. It plans to open at least 2 stores
by the end of 2008 and other 8 in 2009. In the first 6 months of
2008 the KFC network has registered a sales figure of EUR 18
million, a rise by 49% compared with the same period of 2007.
The total number of KFC customers in Romania is of 10 million.
Pizza Hut entered the market in 1994 and opened 11 units, out
of which 4 are located in Bucharest. In 2002, the company signed
an agreement with Metro Group and opened four restaurants in
some of the cash & carry units. In the first semester of 2008 the
registered turnover was of EUR 5 million, with 27% higher than
in 2007.
Burger King (a franchise owned by Atlantic Restaurant Systems)
entered the Romanian market in 2008 with a unit located in
Baneasa Shopping City and then opened another one in City Mall.
It plans to open another unit in Liberty Center and another 6 by
the end of 2009.
During the past three years two Romanian restaurant chains have
extended their networks especially in Bucharest within shopping
centers or in street locations - La Mama has to date 7 restaurants
and 3 coffee shop - Cafepedia (the company registered a turnover
To date the biggest Romanian chain of coffee shops is Turabo Café
that has 4 in Bucharest and 3 in the province (Bra[ov, Ia[i and
Timi[oara), beside the franchises. Marinopoulos Coffee Company
of Greece has brought the Starbucks franchise in Romania in
2007 with three locations to date, two of them located within
Bucuresti Mall and Plaza Romania and one in Iulius Mall Cluj.
Other important coffee chains are Coffee Republic, Gloria Jean's
Coffee and Costa Coffee.
of EUR 8 million in 2007). A new unit Cafepedia will be opened
in Iulius Mall Cluj, the first location in a shopping mall. Second,
City Grill has 7 restaurants in Bucharest (out of which one is Caru'
cu bere) and one in Constan]a, alongside two coffee shops (City
Café) both located in Bucharest at the ground of class A office
buildings. In 2008 City Grill acquired CremCaffe that operates 2
units located in central locations in Bucharest. (Trotter Prim the
company that owns these brands recorded a turnover of EUR 11
million in 2007) .
In the first 10 months of 2008 the available retail space in
Romania increased by 50% as compared with the existing stock
available at the end of 2007 - from 43.20 sqm GLA / 1,000 persons to 62.70 sqm GLA / 1,000 persons.
Source: CBRE Eurisko
* forecast stock by the end of 2008
The calculation includes all modern retail units in Romania with
over 10,000 sqm GLA (shopping malls, retail parks and hypermarket-led schemes). Some other 10 very well located, totally or
partially refurbished department stores (previously state owned)
are operational throughout the country. They are not included in
the calculation because of the fact that, with the notable exception
of Tomis Mall, they do not comply with the Western standards of a
shopping center.
The other centers planned to be opened by the end of this year
are: Aurora Shopping Mall `n Buz\u, West Park including the
Fashion Outlet Center in Bucharest, Grand Arena in Bucharest,
Galleria Piatra Neam] and Suceava and Iulius Mall Suceava.
Even considering the international financial crisis, international
developers and major retail chains are looking to Romania, mainly due to the economic growth, increased spending power and
huge potential of an over 21 million customers market.
While significant competition is announced everywhere in the
country and between all types of retail developments (shopping
centers, retail parks, hypermarket led market schemes) the demand
from retailers and consumers remains high. We believe that
around 40% of the total shopping centers announced will either be
dropped or developed with a different use.
European Accessibility. Bucharest is located at the intersection of
some main European roads and railways:
n
n Bucharest is one of the cities on the Pan-European railway route
no. IX that links 5 countries and has the main stops in Helsinki
(Finland) - Moscow (Russia) - Chisinau (Moldavia) - Bucharest
(Romania) - Plodviv (Bulgaria);
n The Pan-European railway route no. IV links Berlin/Nuernberg Prague - Budapest - Bucharest - Constan]a - Salonic - Istanbul;
n There are three major projects that are to be completed in the
following years (although the construction works have just recently
started only for Transylvania motorway), meaning:
The Pan-European corridor no. IV: Nadlac - Arad - Timi[oara Deva - Sibiu - Pite[ti - Bucharest - Constan]a;
n
Transylvania motorway: Bucharest - Bra[ov -Târgu-Mure[ - Cluj
Napoca - Oradea - Bor[;
n
n There is also one project that will link Ia[i to Târgu-Mure[.
Actually it will start from Sculeni (border check point with Republic
of Moldavia) and will join Transylvania motorway in Târgu-Mure[,
covering 315 km.
Regional Accessibility. Bucharest has 5 main entrances, that link
the capital with all the regions of the country:
n
In the North - on E60 (DN1), from Bra[ov and Ploie[ti
n
In the West - on A1 from Pite[ti
n
In the South - on E70/E85 from Giurgiu and the Bulgarian border
n
In the North - East - on E85 (DN2) from Moldavia region
n
In the South - East - on A2 from Constan]a
E60/DN1 is the most important national road in Romania in terms
of traffic and links Bucharest with the Central and Northern
regions of the country, through Ploie[ti - Bra[ov - Sibiu - Cluj
Napoca - Oradea and reaches Bors (check point at the border
with Hungary).
E85/DN2 is one of the main European roads that cross Romania,
which links Bucharest to Ukraine and further up to Russia. It is the
main North - South commercial road of the country, crossing the
entire region of Modavia. It is also used as a commercial route for
countries like Turkey, Bulgaria, Ukraine, Poland or even Russia.
The total population of Bucharest as of 1st of January 2008 was
of 1,943,981 inhabitants. As seen in the table below (which compares the population of selected capital cities in Central and
Eastern Europe), Bucharest's population, is significantly larger than
several advanced retail markets in Central Europe.
Source: Eurostat 2006, * INSSE 2008
The population in all six sectors of Bucharest (the being the administrative units) has decreased since the 1992 Census apart from
Sector 5 where there has been a slight increase.
Source: CBRE Eurisko
Population density for Bucharest was of 8,117 inhabitants per sq
km at the 1st of July 2007, but this varies significantly by sector,
meaning: 3,266 inhabitants/sq km in 1st District, 11,222 inhabitants/sqkm in 2nd District, 11,612 inhabitants/sqkm in 3rd
District, 8,858 inhabitants/sqkm in 4th District, 9,583 inhabitants/sqkm in 5th District and 9,490 inhabitants/sqkm in 6th
District. Although compared to July 2006 the total population of
the capital registered a slight increase (with approx. 600 persons),
the density per sq km in July 2007 was lower in the following sectors: the 1st, the 2nd, the 3rd and the 6th, while a slight increase
was recorded in the 4th and the 5th Districts.
Source: Bucharest Regional Statistics Office, 2007
The population in Bucharest grew significantly between the
post war years and 1992, primarily due to the migration
from rural to urban areas. In the period 1948 - 2007 the population of Bucharest almost doubled from 1.03 million to 1.93 million people.
The number of people living in Bucharest is expected to grow in
the coming years, despite the general decreasing trend registered
over the past 10 years across the country. This increase in population could be due to a number of factors that include: the city
gathers almost half of the foreign investments in Romania, the
real estate sector - retail, residential, industrial and offices is
booming, the average net salary is the highest thus attracts skilled
labour force from across the country, not taking into account the
foreigners that are employed by the multinational corporations
with branches in Bucharest.
At the 1st of July 2007 some 40% of the Bucharest population
was aged between 25-49 years. This is the age group that will be
spending the most on consumer goods and entertainment. The
50-64 years category is the second with 20% of the total population, followed by the 15-24 years and over 65 years categories
with 14% each. The youngest age group (0-14 years) registered
the smallest ratio - 12%.
In Bucharest the total occupied population was of 936,800 persons. Approximately two thirds of the workforce is employed in
the services sector (64%). This proportion is expected to slightly
increase as the services sector develops particularly the retail and
the banking domains. On the other hand, the industry and construction sector represents 30% of the total number of employees
in Bucharest. During the last years the construction sector has registered a huge demand in terms of workforce due to the significant investments. However this particular demand is hard to satisfy because of the increase numerous number of qualified workforce that are currently employed abroad in countries like Italy
Spain, Gemany or Israel. The agriculture and other services
account for 6% of the total.
The monthly net medium income in July 2008 in Bucharest was
of RON 1.769 (approx. EUR 495) as compared to the national
average of RON 1239 (approx. EUR 347). It is widely believed
that wages in Romania and also in Bucharest are higher than the
official figures as people supplement their incomes with black
market activities or just do not declare their full earnings.
According to the National Institute of Statistics and Economic
Studies the unemployment rate in Bucharest (related to the total
active population) was of 1.7% as of July 2008, which is a significantly lower level than the national average of 3.8%.
Out of the average net monthly income per capita from July 2008
only 75.4% represents the available expenditure, meaning
approx. EUR 373 which includes of EUR 282/month on retail
goods. If we include the black market estimates in these calculations, we believe that an increase by approximately 25-30%
would be the correct assumption.
The gradual decrease for the inflation and unemployment rates,
alongside the increased spending power given by higher earning
potential within Bucharest region over the next few years are
goods signs for the retail market.
Source: Bucharest Regional Statistics Office; Exchange Rate is set at 1Euro = 3,57 RON (October 2007)
NB: These figures do not include Black Market Spending
The retail market in Bucharest is booming in all sectors of activity:
stand-alone units, high-street retail and shopping centers.
For stand-alone units the most sought after locations are those on
the exit roads to Ploie[ti, Pite[ti and Constan]a, with easy access
and with parking available. All the major international players
are present in Bucharest: Carrefour (one unit was opened within
Vitantis Shopping Center in 2008), Cora, Auchan, Real (one unit
was opened in 2008 in Berceni area), Metro, Selgros, Plus,
Praktiker, Bricostore, Tekzen, Mr. Bricolage.
Currently, the on-street retail market in Bucharest registers a high
demand from banks, pharmacies, casinos and show-rooms (auto,
mobile phones and interior decorations). There are still very few
available on-street premises within downtown area. In the top of
most sought for on-street rental areas, the following areas are still
in the top: Roman\ Square, Victoriei Avenue, Universit\]ii
Square, Doroban]i Avenue, Aviatorilor, Mo[ilor Avenue and the
Old City Center. Top rents for prime High Street units are between
EUR 1,440 and EUR 1,680 per sqm per annum while the rental
levels for shopping malls are between EUR 500 - EUR 700 per
sqm per annum and up to EUR 960 per sqm per annum for units
less than 50 sqm.
The shopping mall stock is Bucharest is extremely low compared
to other capital cities of neighboring countries with similar population. Therefore, Budapest and Warsaw have over 20 modern
malls each, but in Bucharest there are only 4 such developments.
In 2007 and first part of 2008 the major development were: the
opening of B\neasa Shopping City Mall, the biggest mall in
Romania to date, the opening of the food-court in Unirea
Shopping Center and the opening of the extension of Bucharest
Mall and City Mall.
During the last two years a significant number of shopping centers projects were announced to enter the market until the end of
2012. For this particular reason the rental level is not expected to
decrease over the next years. Many of these projects are developed by foreign companies like TriGranit, GTC, Mivan, Africa
Israel, Liebrecht & wooD, Plaza Centers, Sonae Sierra etc. and
Continuing the trend registered in 2006 and 2007, during 2008
most of the high quality retail spaces in Bucharest (Bucure[ti Mall,
Plaza Romania, Unirea Shopping Center and Carrefour and Cora
hypermarkets) were taken up.
Source: CBRE Eurisko Retail Department
foreign construction companies like Summa, Ozer, Hochtief etc.
The existing stock of modern shopping centers in Bucharest is
extremely low compared to other former communist countries like
Hungary, Poland or Czech Republic. For example, Budapest and
Warsaw (capital cities with almost the same population as
Bucharest) have over 25 modern shopping centers each.
Even though there were some important openings in 2008, in
Bucharest there is still a deficiency of retail space within shopping
centers, with some smaller cities, like Cluj-Napoca, which have
more retail space / inhabitant than in Bucharest. The openings
planned for this year ( Liberty Center, Grand Arena, West Park)
and for the next year (AFI Palace Bucharest, Sun Plaza, Militari
Shopping Center) will offer new retail space and new brands. The
deficiency of quality supply in Bucharest is strictly related to the
difficulty of finding vast surfaces (located within or outside city
limits) with a well-defined juridical statement and land owners
willing to sell.
To date the entire modern shopping center space in Bucharest is
100% pre-leased. As a result, in the near future the supply is
expected to boost but still it will be immediately absorbed. Rental
rates, though sufficiently high, are not expected to lower throughout 2008-2009 and during the following two years.
is located in the North of the city,
within Baneasa Project. The entire Baneasa project will be developed on a 22 ha plot of land, in several stages until 2015 and
will contain offices (12 ha), residential (approx. 5,000 dwellings)
and retail developments (on 17 ha). The total investment is of
approximately EUR 1.2 billion and the investors estimate to obtain
a yearly turnover of EUR 2 million. The commercial project include
a retail gallery anchored by a Carrefour hypermarket - Feeria
Shopping Center, a furniture shop (Mobexpert) and a DIY outlet
(Bricostore) - all of them already operational. The first IKEA was
opened in the area in spring 2007 and is registering very good
revenues (EUR 87 million in the first year of operation). B\neasa
Shopping City is the mall 'component' from B\neasa Project with
around 55,000 sqm. This project has attracted new brands in
Romania like: Peek&Cloppenburg (4,000 sqm), all the brands of
Inditex Group, IKKS, Sacoor Brothers, Reserved, Next, Oasis,
Orsay, Burger King, Nordsee, She She Restaurant, Humanic. The
project will include by 2009 a 30,000 sqm entertainment center:
Family Entertainment Center and Kids Entertainment Center.
n
n
is the first shopping mall in Romania.
n
is the second major shopping mall in
Bucharest developed by the Turkish Anchor Grup. The scheme has
a total built area of 104,000 sqm (meaning some 43,000 sqm
GLA) of floor space including a supermarket (G'Market), foodcourt (KFC, McDonald's, Ancuta, Broaster Chicken, Spring Time
etc.), cinema (Movieplex) and fashion anchors (Pull & Bear,
Springfield, Nara Camicie, Esprit, Guara, Promod etc.). Plaza
Romania opened in late October 2004. The tenant mix is similar
to that of Bucuresti Mall - a mixture of domestic and some international brands, mainly catering for mid and high market customers.
Its main anchor is the first Zara store in Romania. Works have
already started at the extension of the mall, which will add around
6,000 sqm GLA to the existing surface or more than 30 new
shops. The extension is planned for opening in 2009.
- was refurbished in 2000
and has a total built area of approx. 80,000 sqm, structured on
5 levels, the total leasable area being of approx. 46,000 sqm.
Although the merchandise & tenant mix as well as the partitioning
cannot be compared to the ones existing within a shopping mall
its main advantage is represented by its location - Unirii Square.
To date there are more than 200 retailers within Unirea Shopping
Center, the figure being expected to grow. Some of the main tenants are McDonald's, INA Center, Avon, Sarra Blu, KFC, The Body
Shop, HVB Bank, Germanos, Sensiblu, Altex, Diverta etc. Starting
with the 1st of June 2007 at the fourth floor 'Little Paris' a 5,600
sqm food-court and entertainment center was opened. It includes a
800 sqm casino (Metropolis), a 2,800 sqm Funland Entertainment
Center and a 2,000 food-court (City Bistro, Sushimania, Daylight
n
Together with the extension (operational from mid 2007) it has a
total surface of over 70,000 sqm, structured on 4 levels and the
total leasable area of approx. 36,000 sqm with more than 100
shops. Some of the tenants are: G' Market, Marks & Spencer,
Sephora, Kenvelo, Nike, Media Galaxy, Diverta, Leonardo,
Steilmann, KFC, Ruby Tuesday, Hollywood Multiplex, Bigotti,
Adidas etc. The extension represented a EUR 14 million investment
and added some 18,000 sqm of built area to the existing 52,000
sqm. The new structure has four levels (2 UG + GF + 1) out of
which only the upper two have premises to let and are connected
to the existing one by an atrium. Some of the big names from the
extension are Debenham's, Koton or Starbucks. To date is the most
popular shopping center with an announced traffic of 30,000 35,000 people during week days and over 43,000 in the weekend. (source: Anchor Group).
Donuts, Pomodoro Caffe etc.). A re-leasing process was opened in
2008 including re-positioning / refurbishment of some tenants
(McDonalds, Diverta, B&B Collection) and adding new brands
like: Bata, Fornarina, Geox.
n
- opened in October 2005 on a former unfinished
structure located on Oltenitei Blvd., has 24,500 sqm of gross leasable
area structured on 4 levels, with tenants like Benvenuti, Camel Activ,
Motor Jeans, Stone Creek, Folli Follie, Sony Center, Columbia,
Diverta, Billa, Domo, Primavara, Hondos Center, Burger King. The
n
- this is a HKS Group investment with a gross built
area of 14,000 sqm and 5,500 sqm GLA opened in 2004. It is
located in a new residential area outside Bucharest city limits.
Main anchors: Moda & Style (Gianfranco Ferre, Armani,
Moschino, Dolce & Gabbana etc.) and Primavara.
entertainment facilities are represented by bowling and billiard (Split
billiard) and cinema (Cityplex). The officials at City Mall have started
a re-branding process which will lead to attracting new tenants and
to transforming some retail spaces into office space.
n
is a 28,000 sqm GEA scheme opened in
2001. It is anchored by a 21,000 sqm hypermarket adjoined by
32 retail units. Mobexpert, Domo and Bricostore retail warehouse
units are located adjacent to the scheme. Carrefour Militari is
located out-of-town and is only accessible by car or bus. The bus
service takes up to 1 hour from the city center. However, it is still a
destination for shoppers, who will travel from outside Bucharest to
visit the scheme.
n The
scheme totals 30,000 sqm,
anchored by an 8,400 sqm Carrefour hypermarket. It was opened
on the 24th of September 2003. In addition to the hypermarket,
there are 58 retail units. However, customers are likely to be
drawn to Carrefour Orhideea for its large hypermarket rather than
the shopping gallery (that includes Marks & Spencer, Famous
Brands, Bam Boo, Nissa, Inmedio, BRD, Cellini, Animax etc.).
This one of the most successful retail developments in Romania
due to its location (close to the North railway station and to the
biggest student campuses in Bucharest as well as 10 minutes from
the city center).
and its retail gallery of 3,250 sqm
were opened in 2004. To date, this development has not proved
successful mainly due to the bad access infrastructure and for the
future the main attraction will remain the anchor hypermarket.
n
located in the Eastern part of Bucharest,
was opened at the 1st of October 2003 and also a large shopping
gallery in front of the cashiers. This development's catchment area
is the entire Pantelimon neighbourhood. A Bricostore unit alongside
and a Mobexpert unit are located near this hypermarket.
n
has an exceptional location (on the former
Miorita milk factory site) in one of the most crowded district intersections in Bucharest. The hypermarket surface is of 14,000 sqm
and includes a shopping gallery which will be extended with
3,000 sqm GLA by the and of 2008.
n
n
is the main anchor of Feeria Sopping
Center. The land on which it was developed is of 36,000 sqm, out
of which the hypermarket occupies 15,600 sqm with a sales area
of 8,400 sqm and the shopping gallery has 17,300 sqm.
is part of Vitantis Shopping Center, which
was opened in 2008. The hypermarket has a smaller sales surface
than usual, 4,000 sqm. The other tenants in this project are
Technomarket, Bontas Furniture, Reserved, Cropptown, Kenvelo,
Reno Shoes.
The first
hypermarket in Romania was opened in the
South-Eastern part of Bucharest (Titan area) on the 6th of
November 2006. The hypermarket alone has a sales area of
15,800 sqm, with a shopping gallery of 13,700 sqm comprising
of some 60 shops. In 2008 Iris Shopping Center was opened; the
shopping mall has a GLA of 14,000, a project later sold by Avrig
35 to DEGI, part of Allianz Group.
n
n
has approx. 3,500 sqm and it is located
in the North of the city and it is part of the World Trade Complex
including the Sofitel Hotel. It is located at approx. 20 minutes driving from the city center. The Gallery features elegant boutiques, art
galleries, fashion and antique shops, such as: Valahia Art Gallery,
Cleopatra lux, Etno Art, Ina center, Inmedio, La Galette, Meli
Melo, More & More, Samsonite, Inoxcrom, Faber Castle, Stefanel,
Poltrona Frau and Nobilis.
n
n
is the oldest free-standing shopping gallery
(approx. 2,000 sqm), opened in 1997, in Doroban]i Square. Over
the years, the tenant mix has changed towards a select mixture in
order to attract only the high income consumers. Important tenants
are River Woods, Lush, Stefanel, Casa Mia, Sarra Blu, Wolford,
Eleganzza, Daniel Hechter, Terzoatto, Zia Pia, Bigotti, Privilege etc.
has approx. 5,000 sqm
and it is the one newest shopping gallery. It is part of Grand Hotel
- Marriott, located in the Central Southern part of the city center at
approx. 20 minutes driving from downtown. In June 2008 the first
Louis Vuitton store in Romania was opened here which marks the
beginning of a re-branding process of the Shopping Gallery into a
luxury, very exclusive and expensive shopping avenue. Other
important retailers are: Korloff, Davidoff, Dupont, Bang & Olufsen,
Galt, Daniel Hechter.
n
is a 3,000 sqm commercial
gallery located within an class A office building, respectively
America House (a 45,000 sqm office building in the Victoriei
Square, delivered on the market at the beginning of 2006).
The gallery consists of retail service providers (banks, tourism,
health & beauty, restaurant), clothes and shoes retailers, gifts
and deluxe home decorations shops.
n
within the hotel wite the same
name opened in 2008 and consist of over 20 shops, moslty
service oriented and some fashion and accesories shops.
n
The provision of luxury shopping galleries is quite low at the
moment in Bucharest, the investor focus being of commercial
developments. The luxury shopping centers are mostly located
within reputed hotels, such as the Sofitel Hotel, Rin Grand Hotel
and the Marriott Hotel.
n
is projected to be the shopping destination for the
Southern areas of Bucharest, being located at the intersection of
all Southern districts (at BIG Berceni). The project will have a built
area of 196,000 sqm out of which the shopping center will have a
78,000 sqm GLA including a Cora hypermarket, a DIY unit
(bauMax) and furniture (Mobexpert). The scheme will also comprise of some 170 shops. The entertainment facilities will include a
City Cinema with 15 halls (some 3,000 seats). Some 2,000 parking lots will be available for the visitors. The EUR 150 million
investment will be completed in 2009.
is a mixed-use project based on a public - private
partnership that will be located in the very heart of the city on
11.7 ha land in Unirii area. The developer - TriGranit Corporation
- announced that the project will comprise of office buildings
(75,000 sqm), a hotel of 20,000 sqm, some 30,000 sqm of residential development, approx. 40,000 sqm GLA of retail space,
30.000 sqm of leisure and sport premises, some 110,000 sqm of
parking facilities and 30,000 sqm of office space for public
administrative offices. In the recent months there have been rumors
that the project will be delayed for a period of around 3 years due
to several land expropriation problems.
n
n
- developed by Mivan on a plot of land located at the intersection of Rahova Blvd. with Progresului Str., within
Rahova area. The shopping mall will have 25,000 sqm GLA with
a 3,500 sqm supermarket, 100 shops and a 6 halls multiplex cinema. The will project will be opened in November 2008.
n
- Africa-Israel will develop this project
located on Vasile Milea Blvd. The project will comprise of four
office buildings with a total area of 48,000 sqm, a 10,000 sqm
hotel and a shopping mall of 75,000 sqm GLA with approx. 250
shops, a Real hypermarket as an anchor, the first IMAX cinema in
Romania, fitness club and spa ready by the end of 2009.
- will be located in the North-Western part of
Bucharest and will be developed by Modus Properties. The project
will have some 162,000 sqm of built area, including a retail park.
The completion of the first phase that will include a 15,000 sqm
Carrefour hypermarket and some 36,000 sqm of retail gallery is
due for 2009.
n
n
- part of the Floreasca City project that will
- will be located on Petricani Str. and will be developed by GTC. The shopping mall will comprise of 60,000 sqm
GLA with a hypermarket, retail gallery, food-court and multiplex.
The completion date of the scheme is unknown to date.
n
n
- the former communist retail structure
located near Unirii Square will be refurbished and extended in
order to become the main luxury store in Bucharest. The new structure will have around 10,000 sqm GLA, divided on 5 levels and
according to the owners and to Retail Group (the leasing agency)
will host important luxury brands, around 60% of them being new
brands on the Romanian market. The new Cocor is scheduled for
opening in Q4 2009.
n
- this is an unfinished structure located on Eroilor
Blvd. with a total built area of approx. 550,000 sqm that will be
raised in three different stages by Plaza Centers. The first phase
will include some 39,500 sqm of office and residential developments that will be raised on the existing structure, a shopping mall
with a gross built area of 132,000 sqm, a 40,000 sqm casino
and a parking with 3,000 lots. Another office building with some
11,000 sqm built area will be raised in the back of the site for the
state administrative authorities in conformity with a clause stipulated within the public-private partnership. The second phase will
include two towers totalling some 106,000 sqm comprising of
office, residential, retail and hotel facilities. The third phase will
also include retail, office and residential facilities (some 36,000
sqm), plus some other 600 parking lots.
- the developers of Baneasa project
have won the auction for the Bucur Obor project that will be
raised on 6 levels out of which the underground level and also the
2nd and the 3rd levels will be used for the parking facilities. The
ground floor and the first floor will include retail premises totalling
some 40,000 sqm GLA. A part of the 3rd level alongside the
entire 4th level will be used as office premises. This project will be
completed in 2009-2010 (best case scenario).
n
n
- the existing project was developed by Liebrecht &wooD in 2003 and then sold to Atrium
European Real Estate fund (formerly known as Meinl European
comprise of a shopping mall and one office building that will be
raised on a former industrial site in the Northern part of the city.
The shopping mall will have a built area of 50,000 sqm and the
office building - Sky Tower will have some 33,000 sqm. The first
phase is set for the end of 2009.
Land) in 2004 for EUR 20 million. The scheme has to date some
14,000 sqm. The entire project will stretch on a surface of 22 ha
and when completed in April 2009 and will include shops and big
box retail on approx. 60,000 sqm.
- the Irish company Caelum Development
and the Portuguese Group Sonae Sierra will develop a mixed-use
project on the former site of the Spartac sports fields in Titan area.
It will include a shopping mall as well as residential developments.
The site on which the 110,000 sqm GLA shopping mall will be
raised is of 8.2 ha. In recent months there have been some problems with the building permits as local authorities and NGO's
have stated that the land on which ParkLake Plaza is to be built is
actually a former park and sports complex and according to
Romanian law no private building can be built.
n
n
- the project will be located on the site of the former Electroaparataj factory in the Eastern part of the city, within
Pantelimon area. The scheme will comprise of approx. 80,000
sqm GLA structured on three levels with more than 150 shops. The
parking will include approx. 3,800 lots on three levels and the
completion date is set for late 2010.
n
- the Belgian real estate developer
Bel Rom that has several retail park projects throughout the country, will invest some EUR 100 million in order to develop a mixeduse project comprising of a retail park and two office buildings in
North-Eastern part of Bucharest within Colentina district, on the
site of the former Helitube plant. The owners stated that the
scheme will also include a 22,000 sqm hypermarket. The completion date will be around 2009-2010 according to the developers.
n
- Liebrecht & wooD started in 2007 the construction works for a 90,000 sqm retail park the will be located at the
13th km of the A1 motorway. It will comprise a Fashion House
Outlet Center with 28,000 sqm (including a food court), alongside
a a 13,000 sqm Kika furniture unit (the first one in Romania), a
23,000 sqm Hornbach unit and a white & brown goods retailer Technosa (this is a Bulgarian retailer that has chosen this location
for its second unit in Bucharest, after the one in Vitantis Retail
Park). It will be delivered on the market in the second half of
2008.
n
- the Israeli company has recently
bought the Laromet factory in the North-Westen part of Bucharest
and will raise a mixed-use project on that particular plot of land,
meaning 3,000 residential units and a 25,000 sqm shopping
mall. The scheme will be completed at the end of 2010.
n
- Sparkassen Immobillien, the real estate division
of Erste Bank has announced that it will develop a commercial
project in Jilava, close to the Bucharest city limits. The Austrian
fund bought a plot of land of 97,000 sqm on which a one level
45,000 sqm will be raised in the near future. The opening date for
this EUR 40 million investment was not disclosed yet.
- will be located in Berceni area (Southern
Bucharest). The scheme will have some 50,000 sqm out of which a
with 8,000 sqm sales area Carrefour hypermarket and a 32,000
sqm GLA shopping gallery on two levels (with approx. 200
shops). The clients will benefit of some 2,000 underground parking lots. The project will be delivered on the market in the 4th
quarter of 2008.
n
n
- will be an impressive mixed-use project
combining office buildings, a shopping center, leisure and green
areas located on Bucurestii Noi Blvd. The project will offer a
62,000 sqm shopping mall, with over 150 shops. The total parking space dedicated for this project will have almost 4,000 parking lots.
n
n
1. Unirea Shopping Center
2. Carrefour Orhideea
3. Plaza Romania
4. Cora Lujerului
5. Jolie Ville
6. City Mall
7. Carrefour Militari
8. Carrefour Colentina
9. Feeria Shopping Center
10. Cora Pantelimon
11. Bucure[ti Mall
12. Militari Shopping
Center (phase I)
13. Auchan Titan &
Iris Shopping Center
14. B\neasa Shopping City
15. Vitantis Retail Park
1. Esplanada
2. Casa Radio
3. AFI Palace Bucharest
4. Promenada Mall
5. Galleria
6. ParkLake Plaza
7. Sun Plaza
8. Liberty Center
9. Colosseum
10. AFI Golden Palace
11. Bucur Obor project
12. Mega Mall
13. Sparkassen Immobilien
project
14. Grand Arena
15. West Park
16. Mega Designer Outlets
17. Bel Rom Colentina
At present the highest rated luxury trade areas are the retail
boulevards such as the Magheru Blvd., Calea Victoriei, Nicolae
B\lcescu Blvd., Calea Mo[ilor, Calea Doroban]ilor and Unirii Blvd.
with headquarters of the international companies, banks, advertising and public relations companies.
is one of the most sought for location in
Bucharest at the moment. The wide, one-way street crosses the
city-center between the Northern financial and office center
Victoriei Square and the administrative center near the Parliament
Palace. Despite the very high car traffic at all times in the day, the
very few parking options along Victoriei Avenue makes the pedestrian traffic very scarce. For these reasons, Calea Victoriei is the
location of high class brands that are targeting a very specific
shopper. Shops are not evenly distributed along the high street.
There are three concentrations of shops:
- the first one is close to Amzei Sq., one of the main shopping areas
for fresh food, as well as for entertainment (bars, pub and various
types of restaurants) Close to this intersection there are several international retailers that value the excellent visibility of the shops and
the high pedestrian traffic created by the vicinity of Amzei area and
Hotel Bucure[ti: fashion brands (Guess, Hugo Boss, Mexx, Stefanel,
Catimini, Cerutti 1881, multi-brand shops with designer brands like
D&G, Paco Rabanne, Sonia Rykiel etc.), shoes and accessories
(Musette, Furla), perfumeries and beauty shops (Estee Lauder,
Clinique, L'Occitane) and various deluxe interior design shops
(Kyros Interior, Linea D'Oro, Kartell, Descamps, Destra).
- the second one is located near the former Senate building, close
to Hilton Hotel and Atheneum. This area has been chosen by 2
multibrand stores Victoria 46 and Mengotti and by other important brands like Gant, Pronovias, Philosophy by Emporio Armani.
the third one is close the Universitatii Sq. that is a very crowded
area especially for youngsters. The close vicinity of the University
Bucharest is an atypical European capital, not including a clearly
defined pedestrian shopping area. The downtown of Bucharest is
formed by two important venues: Calea Victoriei and Magheru
Blvd. The high street retail in Bucharest is not a destination yet, but
it is expected to become one once the international retailers will
enter the market (there are many operators already present in
Prague, Budapest or Warsaw but not in Bucharest).
of Bucharest, Lazar College, Faculty of Law and Faculty of
Dentistry influenced the presence of several brand retailers targeting the young customers: Vicina, Miss Sixty, Energie, Camper,
Mariella Burani.
Most of the shops located on Calea Victoriei have small surfaces
ranging between 40-200 sqm, with large windows and elegant
old-style architecture.
Some brands like Escanda have decided to terminate the leasing
agreement due to high rents, while others like Lancel have moved
into B\neasa Shopping City, while Sisley has moved the store in a
different location on Victoriei Avenue (Baldinini and Lacoste located on Magheru Blvd. have also relocated inside B\neasa
Shopping City).
one of the largest and most trafficked boulevards in Bucharest, that is the main access road from Roman\ Sq.
towards University Sq. and continues with Br\tianu Blvd. that ends
in Unirii Sq. Due to the Academy of Economic Studies Bucharest
where there are currently some 22,000 students studying in this
institution, and due to several offices and state institutions located
within Roman\ area, this is probably the most crowded square in
Bucharest. Magheru Blvd. has a variety of commercial activities.
The retailers that rented the spaces a few years ago have mainly
considered the high pedestrian traffic area like fast-foods
(McDonald's, KFC). Within the past 2 years, there has been a fast
growing development of retail banking, as all major commercial
banks need to have a branch on this main boulevard (Alpha Bank,
ING Bank, BRD, Banca Transilvania, Finansbank, Raiffeisen Bank
etc). Main national and international fashion brands have opened
shops, mainly to sustain their brand image. These are not exclusive brands as on Calea Victoriei, but mostly popular casual and
sportswear for youngsters: Little Big, Terranova, Adidas, Time Out,
Nike. Apart from these retailers, the presence of several hotels
(like Ambasador, Lido, Howard Johnson etc) influenced the decision of choosing Magheru as a location for casinos and sports
bets shops, as well as for jewelry and perfumeries. Some other
important retailers present on Magheru Blvd are: INA Center, The
Body Shop, Sephora Priorities (health & beauty), Levi's, Swarovski,
Celinni (jewelery), Vodafone and Orange shops. An important
sector of activity on Magheru Blvd. is stationery and books with
over 20% of the retail being have this activity (C\rture[ti, Noi
Bookstore and the new Diverta shop inside former Eva store).
Currently the commercial profile of Magheru Blvd. is more of a
services oriented artery compared to Victoriei Avenue which is a
high end fashion oriented artery.
is an exclusive avenue from the city center (Romana area) towards the Northern part of Bucharest,
Doroban]i Sq. This is one of the most exclusive residential areas in
Bucharest and this influenced the profile of commercial activities
on Calea Doroban]ilor. The area is populated with some 70% of
the Embassies and Ambassador Residences in Bucharest. The area
has the reputation of one of the highest quoted retail sector, with a
specific of luxury products sales. Within the past few years it has
been a preferred location for furniture (Rovere Mobili), interior
design shops (Casa Mia, Lida, Casa del Arte, Sarra Blu etc.), car
& moto showrooms (Maseratti, Honda), Haute Couture multibrand
stores like The Place concept store, The Place Accesories, pharmacies (Sensiblu, Help Net), small boutiques with niche products
(expensive chocolates, wines, gifts). Also, the luxury shopping center of Mario Plaza is located on Doroban]i Blvd. and concentrates
some of the most reputed home goods boutiques (Bigotti, Privilege,
Daniel Hechter, Lush, Eleganza, Zia Pia etc.). Mario Plaza remains
one of the most important shopping points that created the trend
of luxury goods on Calea Doroban]i.
has had an extremely quick development within
the past few years, especially for sportsware (Nike, Ketler, Lotto,
Fila), other fashion brands for consumers with upper-medium
income (Rebelle, Yokko, Stonefly, Guess, Triumph) and services communication and retail banking (Vodafone, Orange, Banc Post,
BCR, ING Bank, Unicredit }iriac, Volksbank, Raiffeisen etc), casinos (Admiral, Maxbet) and services.
The retail premises are small, between 100-150 sqm and have
large windows. Inside each shop there are separate areas for sale
and for storage but they are well-connected and the access
towards storage is fairly easy.
The area is an excellent retail location as it is situated close to the
city center and the areas with high traffic such as {tefan cel Mare,
Iancului or Colentina. The connection with other large neighbourhoods is very good due to the large boulevards.
is a fairly new location, compared to other commercial areas of the city. However, the nice residential area has quickly developed, especially in the banking sector and other financial services, as well as for showrooms for furniture and interior design shops. Unirii Blvd is the second financial
area in Bucharest, after Victoriei Sq. All major financial institutions
have branches on this boulevard. Both Decebal and Unirii Blvd are
The surfaces of shops located on Magheru Blvd. vary between 20500 sqm. Some of them have also basement and mezzanine.
also well known for showrooms (Natuzzi, Adorama, Berloni,
Zepter, Biokarpet - for furniture, several shops with interior decorations as well and other materials for interior design). The commercial premises are situated along the Unirii and Decebal 6-lane
boulevards connecting the East and Western areas and are located at the groundfloor or mezzanine of the blocks of flats.
Within this area there are large retail premises, mostly over 200
sqm up to 1,000-1,500 sqm, near the Alba Iulia Sq. Most of these
outlets have been transformed into bank branches or company
headquarters.
The most important retail fields other than banking and showrooms
are: fast-foods, restaurants and pubs (McDonald's, La Mama,
Zvon, Ruby Tuesday, Spring Time etc), international couriers (DHL),
casino (Admiral), medical center (Centrul Medical Unirea).
The main advantages of these retail premises are the large windows and the easy street access. Inside the shops the sale area is
separated from the storage and the interior design is efficient.
Apart from Unirea Shopping Center, the area is not a good retail
location as the shops are rather scattered. Although the car traffic
is very high and there are excellent loading/unloading facilities,
the car park remains a problem.
- are the most
important semi-central commercial locations. The 6-lane boulevards are situated one after another and they form a part of a circle surrounding the city center. These boulevards link the North to
the center and to the East side of Bucharest. The city center is only
10-minutes drive away.
All the retail premises are located at the ground floor and mezzanine of the blocks of flats. They are medium-sized, between 200
and 400 sqm including the warehouse. There are very few retail
premises under 100 sqm or over 500 sqm usually located at the
main boulevards crossroads. Stefan cel Mare and Mihai Bravu
boulevards are especially known for all shorts of showrooms (carsToyota, Nissan, Suzuki; lightning products, interior design and
special construction materials - showrooms for tiles, floors, sanitary equipment etc), IT shop (UltraPro, Flamingo), retail banking
(ING Bank, Banca Transilvania, Banca Romaneasca, Piraeus Bank,
Raiffeisen Bank, BCR, BRD, Alpha Bank etc), pharmacies
(Sensiblu, Help Net, Catena), casinos (Maxbet, Million $,
Admiral), 2 Mega Image supemarkets.
One of the main commercial centers is
, with a surface
of over 15,000 sqm. The merchandise is of low-to-medium quality
The retail premises have large windows and easy street access.
The interior is divided into sale and storage areas but the interior
design is often of poor quality.
The location has excellent retail potential especially near the intersections, with high car and pedestrian traffic.
District retail areas like Pantelimon, Drumul Taberei, Militari,
Titan, Colentina are an important segment of the retail market in
Bucharest, mainly because these are located within extremely
highly populated areas. The main features of the retail premises
located within these areas are:
n located at the ground -floor of blocks of flats (50-200 sqm up to
400 sqm);
n main tenants of these premises are: food stores, white & brown
goods retailers, banks, pharmaceutical chains etc.
n the majority of the on street premises benefit form high pedestrian and car traffic.
The rents evolved chaotically from 1989 in Romania. There is no
logical progression of the asking prices, owners of shops being
sensible to private incentives, rather than to economical facts. The
improvement in quality of tenants and the longer duration of the
leases did not lower the rents as expected, but stabilized them at a
high level.
On the main retail boulevards, prices range between EUR 30 and
EUR 140/sqm/month according to surface, location and quality.
Due the shortage of available supply within Magheru-B\lcescuVictoriei area, prices boosted in other well-rated areas: Calea
Doroban]ilor, Calea Mo[ilor, Kog\lniceanu Blvd.
and the interior of the commercial center has the looks of a bazaar.
Only a few national retail chains have leased premises in Bucur-Obor:
McDonald's, Domo or Altex. The commercial center needs to be refurbished inside and there are not enough parking lots available.
The rental rates for retail spaces within shopping centers in
Bucharest downtown locations vary between 30 and 140 EUR/sqm.
In the table above, these are the average rents paid by tenants for
typical retail units to date in Bucharest.
The retail market in Prague is very active in terms of leasing and
the lack of new opportunities on high street has lead to the
increase of rents in prime locations. The most important high street
locations are:
- the most expensive high street in Prague, the
usual size of the stores ranges from 200 to 1,000 sqm. The most
important retailers present here are: Mango, Zara, Benetton,
Adidas, H&M, New Yorker.
- usually known as the center of Prague, retailers
present here are: Bata, C&A, Kenvelo, Marks&Spencer, Debenhams.
- the luxury high street in Prague where all the major
luxury brands are present (Sergio Rossi, Hugo Boss, Christian
Dior, Louis Vuitton).
In Budapest there are two important shopping avenues:
, extremely popular among locals and tourists, a
very crowded pedestrian area, a true magnet for international
retailers like: Zara, Mango, Promod, H&M, Max Mara, C&A.
is expected to become the Central European
Champs Elysees, an avenue filled with cultural, gastronomic and
shopping destinations. Some retailers present here are: Louis
Vuitton, Ermenegildo Zegna, Pelote, Caprice, Wolford.
In other Central and Eastern European Capitals prime rents are at
the following level:
The rental level is growing and there are no signs that it will register a decrease in the years if compared to the Western countries
and even the neighbouring countries like Hungary, Poland and the
Czech Republic.
This report has been produced by CBRE EURISKO solely for information
purposes . The information, opinions and analysis contained herein are
based on sources believed to be reliable, but we cannot guarantee that it
is accurate and complete. Readers should therefore exercise caution in
utilising the information provided and should consult other sources as
appropiate to verify the data.

Retail Market_tipar.qxp

Transcription

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