CBRE: The average turnover of shopping centers increased by 12.5%
According to the latest survey Shopping Centre Index conducted by CBRE, the world leader in commercial real estate services, The average turnover recorded by the Index increased by 12.5% y-o-y, reflecting the positive sentiment on the market driven by economic outcomes, such as the declining unemployment rate and increased wages, which resulted in a raised willingness of customers to spend more. The CBRE Shopping Centre Index recorded footfall increase by 3.7% y-o-y.
Average Turnovers – y-o-y
After three consecutive years of decreases, we recorded an increase in the Food sector (15% y-o-y) which was also the highest among all sectors. The Food sector, followed by significant increases in Comfort (14% y-o-y), House (13% y-o-y) and Specialists (14% y-o-y) corresponded with the positive sentiment and customers’ willingness to buy deferred consumption products and use the leisure activities offer of the centre.
In the Service sector we monitored two notable changes in previous trends. After two years of considerable drops, Pharmacies recorded a 25% y-o-y increase in turnovers. The situation has similarly changed for the Travel agencies with an 9% y-o-y increase after three consecutive years of decline which related to already mentioned positive sentiment.
Fashion is dominating both total space with 58% and count of units with 42%. However it was the only sector with a decrease in terms of the number of units. The highest increase of units, almost 10% y-o-y, was in House and Specialists and over 4% y-o-y in Food and Service.
Index by tenants categories (as % of total sq m)
Thanks to the high turnovers the average basket increase by 9.1% and reached its historical maximum. Customers’ behavior in terms of shopping centre visit s during the year remained relatively stable. Almost 50% of total visitors came to the shopping centre during the first half of the year. The monthly footfall varied between 7% and 9% of total annual amount, with the exception of December when the share exceeded 11%. Among the weaker months we monitored the first month of the year and summer months. In a given period, the footfall decreased only in January and August month-on-month. Other months in 2015 recorded an increase that varied between 3% to almost 9% y-o-y.
CBRE Shopping Centre Index´s positive numbers demonstrate the strength of the retail occupational market, which in turn will provide investors with added confidence when investing into Czech shopping centres. We expect this to encourage greater investment volumes in the Czech retail sector and are already witnessing strong activity levels in the market.
CBRE Group, a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2016 revenue). The Company has approximately 75,000 employees and serves real estate investors and occupiers through approximately 450 offices worldwide (excluding affiliates). CBRE offers a broad range of integrated services including project management; property management; investment management; valuation; property leasing; strategic consulting and research and consulting. In the Czech Republic, CBRE has almost 350 employees and manages nearly 70 commercial premises with a total area nearly 1.2 mil. sq. m. Read more at www.cbre.cz.