The changing face of retail
In 2004 alone, over 200,000 sqm of commercial space have been delivered, with Blue City, which opened in late March, and Arkadia, which opened in October, boosting retail space in Warsaw by one fifth.
Tatiana Siemieniuk, head of retail agency at Jones Lang LaSalle, believes that although in many ways the Warsaw retail scene is well developed, there is still a lot of room for improvement and additional work.
"In terms of constructing more large projects, the space is rather limited," she said. "But a lot can still happen on Warsaw's retail streets as it did recently on Marszałkowska where we now have global brands, such as H&M, C&A, Zara or Sephora."
These new solutions, according to experts, can include projects involving the revitalization of urban space in city centers and the construction of family centers in smaller towns. Tatiana Siemieniuk agrees with this, adding that large department stores are particularly interested in the city center as the next investment destination. These city-center department stores could be operated by one or more companies, offering a wide variety of brands and services.
"I think the so-called revitalization of the city center is the next step in retail development," she said. "Sooner or later investors will come in and buy entire blocks in the center. It will be difficult with the Warsaw land ownership structure but we're hoping that it will be a hurdle they can overcome. A number of British companies that are already present in the Czech Republic or Peek&Cloppenburg are already looking for locations in the city center."
Experts also predict that there will be increased interest in the development of entertainment facilities from developers. The share of entertainment space in shopping malls is growing quickly with facilities ranging from 3-D cinemas to go-kart tracks. This could be linked with the fact that local consumers have rapidly started looking for new reasons to visit the malls. Similarly, they have also become a lot pickier when it comes to specific stores and brands that are present in the capital's shopping centers.
"I think that Warsaw consumers have become more selective," said JLL's Tatiana Siemieniuk. "There is a strong need to search for brands. We can see that in the shopping malls the brand-name stores are filled with clients. However, smaller "no-name" stores are really suffering. This reflects the changes in Polish consumers' lifestyle and ambitions. As the standard of living increases, people want to be perceived as affluent. Clients are increasingly looking for brand names and although there are many present in the medium price range, other clients are looking for the more expensive, niche brands."
This opinion proves that despite plans to expand chains of discount and retail outlets, the prediction of an increased demand for luxury centers may well be justified. As a result, multifunctional shopping malls of a higher standard may become more profitable.
According to Tatiana Siemieniuk areas such as Plac Trzech Krzyży have the potential to become Warsaw's upmarket paradise but she believes there is actually a shortage of luxury brand names in the city retail offer.
"Warsaw is still short of these luxury stores," she said. "In Prague you can see a lot more luxury brands, such as Dior, Ferragamo, Hermes, Dunhill and Louis Vuitton, than in Warsaw, but I think they will come to Warsaw as well. Our market is much larger and wealthier than that of the Czech Republic and it could also accommodate these upmarket retailers."
The luxury trend aside, PwC experts also predict that consumers will show increased interest in the creation of retail parks and outlet centers in the city's suburbs.
This view is confirmed by the expansion plans of Neinver Polska, owners of the Ursus-located Factory Outlet, who recently purchased a 9-hectare plot in the suburb of Białołęka. Meanwhile, Belgian developer Liebrecht & wooD are getting ready to open their Fashion House Warsaw outlet in Piaseczno in the autumn of next year.
Warsaw consumers should also brace themselves for a flood of new retailers. Although many retailers still perceive Warsaw as an unstable market compared to, for instance, Prague, some may soon enter Poland with franchise-owned test shops.
"Certainly we can expect new retailers on the market, well-known names like French Connection or Kookai," said Siemieniuk. "The British franchise Next is already present in Prague and the next logical step would be to look at the Polish market, while Humanics will soon open its first store in Reduta. There are many more brands that would be welcomed on the local scene such as British Home Stores (BHS), Debenhams, Oasis, Hobbs, Etam, Celio, Zero, St. Oliver, Bershka, Tie Rack, Guess and upmarket brands such as Hermes or Loius Vuitton."
The barrage of foreign brands that have entered or are planning to launch their stores on the Polish market has not gone without an effect on Polish retailers, such as Reserved or Tatuum.
"The arrival of foreign brands increases the competition on the market and is also responsible for the improvement in the quality offered by the Polish stores, starting with the store fit-out to the products themselves," said Tatiana Siemieniuk. "The fact that so many brands still want to gain their foothold on the Polish market is a positive sign as it expands the retail offer, while the clients benefit from better quality and prices."
Tatiana Siemieniuk, head of retail agency at Jones Lang LaSalle, believes that although in many ways the Warsaw retail scene is well developed, there is still a lot of room for improvement and additional work.
"In terms of constructing more large projects, the space is rather limited," she said. "But a lot can still happen on Warsaw's retail streets as it did recently on Marszałkowska where we now have global brands, such as H&M, C&A, Zara or Sephora."
These new solutions, according to experts, can include projects involving the revitalization of urban space in city centers and the construction of family centers in smaller towns. Tatiana Siemieniuk agrees with this, adding that large department stores are particularly interested in the city center as the next investment destination. These city-center department stores could be operated by one or more companies, offering a wide variety of brands and services.
"I think the so-called revitalization of the city center is the next step in retail development," she said. "Sooner or later investors will come in and buy entire blocks in the center. It will be difficult with the Warsaw land ownership structure but we're hoping that it will be a hurdle they can overcome. A number of British companies that are already present in the Czech Republic or Peek&Cloppenburg are already looking for locations in the city center."
Experts also predict that there will be increased interest in the development of entertainment facilities from developers. The share of entertainment space in shopping malls is growing quickly with facilities ranging from 3-D cinemas to go-kart tracks. This could be linked with the fact that local consumers have rapidly started looking for new reasons to visit the malls. Similarly, they have also become a lot pickier when it comes to specific stores and brands that are present in the capital's shopping centers.
"I think that Warsaw consumers have become more selective," said JLL's Tatiana Siemieniuk. "There is a strong need to search for brands. We can see that in the shopping malls the brand-name stores are filled with clients. However, smaller "no-name" stores are really suffering. This reflects the changes in Polish consumers' lifestyle and ambitions. As the standard of living increases, people want to be perceived as affluent. Clients are increasingly looking for brand names and although there are many present in the medium price range, other clients are looking for the more expensive, niche brands."
This opinion proves that despite plans to expand chains of discount and retail outlets, the prediction of an increased demand for luxury centers may well be justified. As a result, multifunctional shopping malls of a higher standard may become more profitable.
According to Tatiana Siemieniuk areas such as Plac Trzech Krzyży have the potential to become Warsaw's upmarket paradise but she believes there is actually a shortage of luxury brand names in the city retail offer.
"Warsaw is still short of these luxury stores," she said. "In Prague you can see a lot more luxury brands, such as Dior, Ferragamo, Hermes, Dunhill and Louis Vuitton, than in Warsaw, but I think they will come to Warsaw as well. Our market is much larger and wealthier than that of the Czech Republic and it could also accommodate these upmarket retailers."
The luxury trend aside, PwC experts also predict that consumers will show increased interest in the creation of retail parks and outlet centers in the city's suburbs.
This view is confirmed by the expansion plans of Neinver Polska, owners of the Ursus-located Factory Outlet, who recently purchased a 9-hectare plot in the suburb of Białołęka. Meanwhile, Belgian developer Liebrecht & wooD are getting ready to open their Fashion House Warsaw outlet in Piaseczno in the autumn of next year.
Warsaw consumers should also brace themselves for a flood of new retailers. Although many retailers still perceive Warsaw as an unstable market compared to, for instance, Prague, some may soon enter Poland with franchise-owned test shops.
"Certainly we can expect new retailers on the market, well-known names like French Connection or Kookai," said Siemieniuk. "The British franchise Next is already present in Prague and the next logical step would be to look at the Polish market, while Humanics will soon open its first store in Reduta. There are many more brands that would be welcomed on the local scene such as British Home Stores (BHS), Debenhams, Oasis, Hobbs, Etam, Celio, Zero, St. Oliver, Bershka, Tie Rack, Guess and upmarket brands such as Hermes or Loius Vuitton."
The barrage of foreign brands that have entered or are planning to launch their stores on the Polish market has not gone without an effect on Polish retailers, such as Reserved or Tatuum.
"The arrival of foreign brands increases the competition on the market and is also responsible for the improvement in the quality offered by the Polish stores, starting with the store fit-out to the products themselves," said Tatiana Siemieniuk. "The fact that so many brands still want to gain their foothold on the Polish market is a positive sign as it expands the retail offer, while the clients benefit from better quality and prices."
