Germans invest DM 200 million in Lodz retail project
Hamburg-based ECE Projektmanagement broke ground last month on Galeria Lodzka, a shopping center to be located on ulica Piotrkowska in downtown Lodz.
The DM 200 million investment will house 40,000 square meters of retail space and include a HIT hypermarket, electronics store Media Markt, 120 shops and a number of restaurants and cafes. The project is scheduled for completion in the fall of 2002.
According to ECE Leasing Manager Michal Swierszczynski, 48% of Galeria Lodzka has already been leased and another 25% has been let as prelease deals. "It's a very attractive location on the main shopping street in Lodz and we're offering a different kind of retail, not like in the first generation of hyper- or supermarkets, where you have just plain space," he said. As with most of ECE's developments, Galeria Lodzka is based on the concept of "city-center shopping" and will feature a variety of retailers that blend into the fabric of the neighborhood. "We want our center to dominate in Lodz (and) so far there is no such facility in the city," Swierszczynski said. He added that the project will attempt to capitalize on the city's history, which has been always connected with the textile and film industries. "One of the most important things was to get a representative tenant mix that would suit Lodz's inhabitants," Swierszczynski said.
With more than 828,000 residents and a catchment area of 1.2 million potential shoppers, Lodz seems like a good bet for investment. Even so, questions remain. "Lodz is a difficult city," said Grzegorz Pekalski, leasing manager with French developer Cefic. He said one of the biggest problems is the city's high unemployment rate (15.5% in December) and that many chains have already set up shop there. Another concern is Lodz's low average monthly income zl. 1,730 per capita in 2000. "(ECE) will have to do it really well and support it with good marketing," Pekalski said.
Last year, ECE announced a 20-year plan to construct 20 shopping centers across Poland at a cost of zl. 300 million-zl. 400 million ($75 million-$100 million) each. The company belongs to the Otto group, which includes Deutsche Bank and investment company IVG. ECE, which operates about 60 shopping centers and office buildings in Germany, completed its first Polish project Wroclaw's Galeria Dominikanska at the end of March. The DM 160 million complex was 90% let before completion. The company's next development, in Szczecin, will have a total retail space of 30,000 square meters. Construction is slated to begin in 2003.
Radio Zet moves to Zurawia 8
Media group Eurozet managed to house all its subsidiaries under one roof last week when it moved to Warsaw's Bliski Centrum on ul. Zurawia 8. Radio Zet, RRM, Euronet, Studio Zet and the company's Internet service arm have taken 3,000 square meters on four of the building's six floors. Real-estate agencies Prime Property and Unikat Commercial Properties negotiated the deal.
Radio Zet had previously been located in three downtown offices two on ulica Piekna and one on ulica Nowy Swiat totaling 1,500 square meters, half of the national broadcaster's new space. In the past 11 years, Eurozet has grown from a handful of employees to more than 300, 180 of whom work at Radio Zet. "With that many people, it's hard to communicate when you have so many offices," said Krzysztof Kouyoumdjian, the station's PR manager.
And "(the new space) was adapted to our needs, which was crucial in choosing the site," Kouyoumdjian said. "We decided (Zurawia) is the best solution for us." After looking at dozens of modern office buildings during an 18-month period, Kouyoumdjian said that Bliski Centrum was chosen because of its technical specifications, which suited Radio Zet's needs as a studio.
Asking rent in the 4,600 square-meter building is $23 per square meter a month plus a $4 service charge. Bliski Centrum was 95% let at the end of April.
Announcements
n Knight Frank Nieruchomosci has released its first-quarter results. The U.K.-based real-estate consultancy recorded 7,100 square meters in office transactions for the period, with the biggest deal being an 1,100 square-meter lease to insurer Inter Polsk in the Optimus building. The second largest deals involved the Archibald language school, which will move into a 900 square-meter space in the Hector II office building, and Universal Music Polska, which leased 900 square meters in the American Restaurants office building. Other big deals included Bankowe Centrum Informatyki's lease of 820 square meters in the Kampoleone office building in Wroclaw, and German insurer Allianz's lease of 700 square meters in an office building on Warsaw's ulica 17 stycznia.
n Atrium Centrum, a 16,000 square-meter, class-A office and retail building located on Aleja Jana Pawla, held its topping-out ceremony last week.
n Internet portal Onet.pl leased 1,200 square meters in Reform Plaza last month. Centre Properties was the the building's agent.
n Multikino opened its first outlet in Krakow this month. The zl. 52 million ($13 million) investment, located in the Olsza district, boasts 12 screens and seats for 3,000 viewers.
