- In 2016, 50% more rental space in retail parks is to be created compared to the previous year
- Retail park area is increasing primarily in France, Italy and Great Britain
- Market participants, who until now had preferred sought-after high street locations, are now sounding out retail parks
- Germany and France have at their disposal around 70 % of the retail park space in Western Europe
The interest in retail parks within Europe is growing significantly. This is revealed by the current “European Retail Park Development Report” by Cushman & Wakefield, which was published today. According to the report, 1.3 million m² of new retail space in retail parks will be created by the end of this year, i.e. 50 % more than in 2015.
The real estate consultants’ analysts also forecast that yet another 1.1 million m² of rental space will be added to that in 2017. This corresponds to an additional increase compared to the 836,000 m² created in 2015 throughout Europe. This means that the retail space in European retail parks will increase from the beginning of 2016 until the end of 2017 from 37.3 million m² to nearly 40 million m². Of the 2.41 million m² of planned retail space, 2.06 million m² is located in Western Europe and 0.35 million m² in Central and Eastern Europe. The French remain the European leaders in retail park development: France accounts for 54 % of the new retail space in Western Europe, with 17 % accounted for by Great Britain and 10 % by Italy.
Martin Supple, EMEA Out of Town Retail Partner at Cushman & Wakefield, explains: “The demand for well-located and accessible retail parks is strengthening, and is being met with the addition of upmarket food operators and an improved quality of redevelopment and refurbishment. There has also been an increase in new entrants, as many retailers traditionally associated with the high street – such as H&M, Zara and CCC – look to test the water and trial retail parks as part of their portfolios.”
The key trends in the European market at a glance:
- Growing demand from consumers and retailers for easily accessible retail parks in good locations
- Increased attractiveness of retail parks thanks to a wider retail range, high-quality food operators as well as leisure and entertainment offers
- An increase in smaller retail parks with limited, local coverage
- Changes to the tenancy structure, with a growing number of companies which had, until now, chosen the high street and shopping centres as locations for their businesses
According to Martin Supple, retail parks are also becoming increasingly attractive to investors and tenants throughout Europe due to their relatively low rents, flexible layout and better logistical structure for store deliveries. Consumers, for their part, are attracted to retail parks thanks to the concept of one-stop shopping and free parking. “Both contribute to the fact that the development pipeline is currently running at full speed,” says Supple.
Reluctance in the German market
According to the report, Germany recorded a significant decline of 71% compared to the previous year in the increase in area by new retail parks. “Here in Germany, with 8.5 million m², we already have a very large supply of retail park space and are in second place in Europe after France,” says Ursula-Beate Neißer, Head of Research for Germany at Cushman & Wakefield in Frankfurt “This corresponds to a share of around 20 % of the total retail park space in Europe.” In 2015, a total of eight new retail parks with an area of over 5,000 m², were opened in Germany, including, for example, the retail park at the former goods station in Bensheim or the Saalbach Center in Bruchsal. At least another seven retail parks will be created in Germany in 2016/2017.