Most retail developments in Hungary were in an advanced stage of construction at the eruption of the financial crisis, so to put these projects on hold would have come at a greater cost than finishing them, property consultant DTZ said in a press release.
This resulted in 83,000 sq m of retail space being completed in the first six months of 2009, which included a large number of strip malls, bringing Hungary’s total modern retail stock to 1.77 million sq m.
Éanna Maksay, DTZ’s research analyst commented “in 2009 over 300,000 sq m retail space is due to be delivered to the market. However, I expect that some of these projects will be delayed and delivered only in 2010. While in 2008 the countryside developments were dominating, 2009 can again be the year of Budapest. Albeit, a notable amount of the developments were handed over in the countryside in the first half of the year, 100,000 sq m of retail schemes are expected to be delivered in the Budapest market by Christmas.”
Several brands have announced their expansion intentions, proving that new developments excite their demand. For example both Peek & Cloppenburg group member van Graf, a new entrant in the Hungarian market, and Motivi, which has been present only in Debrecen in Hungary, will open a store in Allee. Not only shopping malls are influenced by the expansions. High street retail will continue to grow with the luxury fashion brand Armani on Andrássy út and the Italian fashion company Gruppo Coin will be represented with two brands in the newly refurbished prestigious Palazzo Dorottya in the heart of Budapest.
From a Central and Eastern European point of view we can say that in Budapest, Bucharest and Warsaw the prime shopping centre rental levels are roughly 10% lower compared to prime high-streets. Only Prague shows a significantly diverse trend, where the €170 per sq m/month rents in the latter type of retail schemes exceeds the shopping mall prices by 50%. (press release)