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News Release


Kiev is Lagging European Cities on Shopping Centre Stock

Kiev, 6 November, 2013 — By the end of 2013, Kiev’s retail market is likely to receive additional 95,700 sq m of new shopping centres, with the Q4 results exceeding the combined outcome of the previous three quarters, according to Jones Lang LaSalle experts.

Only one shopping centre has been opened in the Ukrainian capital since the beginning of 2013, Silver Breeze, with the GLA of 14,600 sq m. Announcements for Q4 include Gulliver shopping centre (45,200 sq m) and Art Mall (35,500 sq m), as well as Manufactura outlet centre (15,000 sq m). If all the announced projects are realized, the total of 110,000 sq m GLA will appear in the market in 2013, which will exceed the result of the previous year by 6%.

Anna Chubotina, Head of Retail, Jones Lang LaSalle, Ukraine, says, “By the year end, the total quality shopping centre stock in Kiev will reach 727,000 sq m. Meanwhile, Kiev’s retail space per capita ratio remains one of the lowest in Europe — 222 sq m per 1,000 inhabitants. This explains why Kiev is attractive to both local and international mall developers. In 2014 we are expecting the record-breaking entrance of 470,000 sq m due to opening of several large complexes. As a result, the market saturation in Kiev will rise to 419 sq m per 1,000 inhabitants.”

European Shopping Centre stock

European Shopping Centre stock_rus06112013.png
Source: Jones Lang LaSalle

Supply dynamics
Supply dynamics_rus_06112013.png
Source: Jones Lang LaSalle

Currently, vacancy rates in Kiev’s shopping centres are about 2-3%. According to Jones Lang LaSalle’s forecasts, this indicator will remain unchanged until the opening of large new malls next year.
At the same time, rents in Kiev are experiencing growth: in Q3 2013 the prime rents for shopping centres was USD1,200 per sq m per year. However, rents in Kiev are among the lowest in Europe. It is 2.4 times cheaper than in Paris where the highest rates are USD2,900 per sq m per year and 3.7 times cheaper than in Moscow, with its USD4,500 per sq m per year.
Prime Base Rents: European Benchmarks (USD/sq m/year)
Prime Base Rents European Benchmarks_rus_06112013.png
Source: Jones Lang LaSalle
Anna Chubotina adds, “Kiev’s market keeps on attracting new retailers. In 2013 a lot of them opened their first stores, including LC WAIKIKI, Collezione, Jack Wolfskin, BOGGI, Z-Generation, Petit Bateau, YAMAMAY, Armani Jeans, Camper, Versace Collection, Zadig & Voltair, Penti, Texas Chicken, Homster — domestic chain of interior solutions supermarkets, Happylon entertainment centre. In the nearest future, we are expecting to see such brands as Spanish Cortefiel and Pedro Del Hierro, Polish Sinsay, Russian DESEO by Incity, the first restaurant of the German chain Vapiano representing Italian kitchen, among others.”
About Jones Lang LaSalle
Jones Lang LaSalle (NYSE:JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual revenue of $3.9 billion, Jones Lang LaSalle operates in 70 countries from more than 1,000 locations worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services to a property portfolio of 242 million square meters and completed $63 billion in sales, acquisitions and finance transactions in 2012. Its investment management business, LaSalle Investment Management, has $46.7 billion of real estate assets under management.
In Russia and CIS Jones Lang LaSalle have offices in Moscow, St. Petersburg and Kiev. Jones Lang LaSalle, Russia was voted Consultant of the Year in 2004, 2006, 2007, 2008, 2009, 2010, 2011, 2012 and 2013 at the Commercial Real Estate Awards, Moscow and Consultant of the Year at the Commercial Real Estate Awards 2009, St. Petersburg.
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