Developers in the retail market continue to bet on small cities and small formats

In the first half of 2022, nearly 110,000 sqm of modern retail space was completed in Poland, of which 19,000 sqm were expansions. Thus, the lowest six-month supply in five years was recorded. The dominant position among new developments is occupied by retail parks in small cities, and forecasts for the coming months do not augur a change in this trend.

As much as 84 percent of new space was delivered in cities with a population of less than 100,000. Investments take the form mainly of small retail parks with an everyday shopping profile – they accounted for nearly 90 percent of all projects.

A noticeable trend in the retail market is the development of the circular fashion model, which most often involves the production of clothing from recycled fabrics and the circulation of used clothes through re-sale.  This applies to both mainstream and luxury brands, which create their platforms for selling used clothes and accessories or join the typical second-circulation marketplaces profiled. 

"The development of the circular economy model is part of the growing importance of social, environmental and economic (ESG) responsibility in the retail industry, but also pro-environmental awareness among the public. Customers ask, and brands answer. Recent years have seen an increase in activity in this area, and this trend will certainly grow, involving more and more companies in the retail industry. This will also be related to the planned introduction of EU regulations from 2024 requiring companies to report on the environmental impact of their business activities, among other things. In addition, the importance and necessity of sustainability efforts are evidenced by the level of CO2 emissions generated from production and trading alone, which is currently estimated at around 8-10 percent of global gas emissions," Marta Machus-Burek, Senior Partner at Colliers, Head of Commercial Space and Strategic Advisory, said.

(WBJ)