Shopping centres report growing footfall and turnover levels while smaller retail formats continue to cement their market position - all that against the backdrop of the growing number of silver generation customers and interesting debuts of brands from Ukraine and the Baltic states. Experts and analysts of real estate advisory firm BNP Paribas Real Estate Poland summarize the second quarter of 2023 on the Polish retail market.
The Polish retail market ended the first half of 2023 strongly, with its total stock amounting to 15.9 million sqm. In the past quarter, 66,000 sqm came on stream across Poland, bringing total new retail supply for January-June 2023 to 150,000 sqm.
New retail park completions have dominated recent months with only one shopping centre - Galeria Bawełnianka in Bełchatów - opened in the second quarter of 2023, say report authors. The retail complex, which was built in 2013 but remained vacant for ten years, will be one of this year’s headline openings. Two retail parks also opened their doors to customers: in the Węglin district of Lublin and in Dzierżoniów, at the site of the former PKS coach station.
“Retail development has been driven in recent months by retail parks and this is unlikely to change in the near future. More than 100,000 sqm has been developed in such facilities in the year to date. Retail parks are booming in small and midsized towns and the largest cities alike. Importantly, the growth of this format provides an excellent springboard for discounters. Dealz, for instance, has recently announced its plan to double the number of its stores in Poland to approximately 340 by the end of 2023,” says report co-author Klaudia Okoń, Senior Consultant, Business Intelligence Hub and Consultancy, BNP Paribas Real Estate.
The largest project under construction is Nowa Sukcesja, a shopping, entertainment and service centre in Łódź, where work continues on store fit-outs and a family zone. Nowa Sukcesja is scheduled for opening in the first half of next year. Construction work is also underway on the Koszalin Power Center, the largest and most modern retail complex in the Koszalin region. It will offer approximately 38,000 sqm of floorspace in 30 stores and will welcome its first visitors in the first quarter of 2024.
Consumption down, turnover up
According to data from Statistics Poland (GUS) cited in the report, retail sales for May in constant prices were down by 6.8% year-on-year. In addition, the April-June period was the third quarter in a row with falling consumption. On the other hand, data from the Polish Council of Shopping Centres (PRCH) shows that turnover in current prices grew in April by 9% year-on-year across all retail categories. Broken down by category, services were the best performer with a 30% increase year-on-year, followed by F&B (+17.8% y-o-y) and fashion (+10.2% y-o-y). Another positive development in April 2023 was a 2.6% increase year-on-year in the average shopping centre footfall, a metric tracked by PRCH.
Silvers are shopping, also online
Seniors are a growing consumer demographic. They are increasingly more likely to use mobile apps and opt for cashless payments when shopping. Experts agree that the ageing of societies is one of the key demographic trends of our times and that people aged 65+ - as representatives of the silver generation - deserve to be looked at without stereotypes interfering, with their enormous potential recognized.
“Silvers have savings and increasingly want to spend money on satisfying their needs or whims in addition to financially supporting their children and grandchildren. They want to travel more, learn, use new technologies, dress more fashionably and take care of how they look. It’s time to say goodbye to stereotypes. The retail sector must know how to address their needs,” adds Klaudia Okoń.
Newcomers from the Baltic states
Polish customers and retail schemes have recently attracted the attention of companies and brands from Ukraine and the Baltic states. For them, Poland is a natural destination to grow, says BNP Paribas Real Estate.
“Brands from Lithuania, Latvia, Estonia and Ukraine are being driven to enter and expand into the Polish market by its absorption capacity, cultural affinity and a shared view on the geopolitical situation. They are targeting primarily large established shopping centres. These include Candy POP, a Lithuanian-based retailer of sweets and snacks from well-known brands from Japan, the US and other countries. It will open its first Polish stores this summer in Warsaw’s Złote Tarasy and Westfield Arkadia. Meanwhile, Posnania has attracted Ukrainian fashion retailer Solmar,” says Fabrice Paumelle, Head of Retail, BNP Paribas Real Estate.
In early July, Popeyes, a US fried chicken fast food chain, has opened its first restaurant in Pasaż Grunwaldzki in Wrocław. It has also announced new planned openings in Centrum Galaxy in Szczecin and Złote Tarasy in Warsaw.