2. INTRODUCTION CONTENTS:
The present report has been prepared by Cushman & RETAIL IN RUSSIA 3
Wakefield in order to provide a retail real estate market PEOPLE 4
overview of various Russian cities. RETAILERS 4
By now, the country has reached the stage of post-crisis CITIES 5
recovery. Traditionally, retail is considered a key driver of CITY INDEX
economic growth. The country is huge, spreading through
ASTRAKHAN 33
several time zones, and each city has its own unique char-
acter and real estate market dynamics. Consumer behav- BARNAUL 34
ior varies across the country with many factors influencing CHELYABINSK 18
a specific location: the level of economic development, EKATERINBURG 11
welfare of the population, income level, purchasing habits, IRKUTSK 26
etc. We trust that this report will serve as an introduction
IZHEVSK 27
to the retail real estate market in the present changing
KAZAN 16
environment.
KEMEROVO 23
The information used here is based on regular monitoring
of cities, on Cushman & Wakefield‘s databases, on national KHABAROVSK 32
and regional statistics, as well as on our own analysis. KRASNODAR 21
KRASNOYARSK 35
LIPETSK 36
MOSCOW 6
MOSOW REGION 10
NIZHNIY NOVGOROD 12
NOVOKUZNETSK 22
NOVOSIBIRSK 15
OMSK 14
ORENBURG 30
PERM 24
ROSTOV-ON-DON 17
RYAZAN 28
SAINT PETERSBURG 8
SAMARA 13
TOGLIATTI 25
TULA 29
TYUMEN 31
UFA 19
VLADIVOSTOK 37
VOLGOGRAD 20
TABLES 38
3. RETAIL SPACE
ACROSS RUSSIA
2012-2013
RUSSIA RETAIL SCENE RETAIL TURNOVER IN EUROPE (BN USD, 2011)
While modern retail only appeared in Russia 10
years ago, shopping soon became a cultural activity Croatia 16.605
Slovakia 18.36
Hungary 31.86 France 556.875
for many. Over the last two decades, the country has Romania 32.535
Ireland 36.45
Czech Republic 42.12
Greece 50.895
Germany 548.1
gone through a major cultural change, leaving be- Portugal 53.595
Finland 54.675
hind many old habits and traditions. As a result, con- Denmark 60.21
Others** 60.615
sumer behavior is still forming, thus retailers do not Norway 61.155
Austria 66.15
Russia 534.6
only enjoy a rise in income but also face structural Sweden 94.5
changes in consumer habits. The market is still very
Belgium 97.875
United
Switzerland 108.27 Kingdom
much in its infancy. Poland 110.025
459.54
Netherlands
At the moment Russia is the largest market in 130.275
Spain 264.195 Italy 332.505
Turkey 170.1
Europe with the third (after France and Germany)
retail turnover in EMEA. Russia is still enjoying
Source: GFK GeoMarketing
positive dynamics of GDP growth which is more than
RUSSIAN RETAIL TURNOVER, %
5% per year.
Aviapark, Moscow 20%
15%
10%
5%
0%
-5%
-10%
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
2006 2007 2008 2009 2010 2011 2012
Source: Rosstat
RUSSIAN RETAIL FORMATS
Shopping centres: Street Retail:
Total existing quality stock in Russia totaled over 13.6 million sq
Lack of buildings constructed for modern day retail (usually un-
m GLA as at 1 April 2012 or 95 sq m per 1000 inhabitants, well
der residential, poor shop depth, utility issues) and a limited
below the European average of 247 sq m.
number of streets suitable for international brands.
New ―world class‖ malls emerging. Most successful shopping
Unsophisticated and opaque market – although signs of improve-
malls have 100% occupancy with retailer waiting lists.
ment being seen.
The majority of quality projects are located in large cities,
Climate restricts footfall. Though in many cities with populations
though during recent years the activity of developers has also
less than 500.000 people street retail still dominates due to lack
grown in cities with populations less than 500,000 people.
of alternative opportunities.
New retail formats:
Big box: actively developing format, mainly in the hypermarket
and DIY segments.
Retail parks: the market is yet to see this format however de-
velopers are considering due to the strong demand from the big
box operators.
Factory outlets: the first outlet project in Russia opened in
2012 with two more scheduled in Moscow for 2013. Developers
are planning more due to retailer demand in this new format.
E-commerce is actively developing – in 2011 nearly 6,1 million
people purchased via the Internet (16.5% growth in comparison
with previous year). According to experts, forecast retail turn-
over in this segment will grow in 2012 by 36% in comparison
with 2011.
3
4. RETAIL SPACE
ACROSS RUSSIA
2012-2013
PEOPLE RETAILERS
Russians are very heavy spenders. About 80% of all earnings end Russia has 58% of the key international brands, 51% of these are
up in the shops. found in Moscow, placing it 11-th in European annual brand rep-
Salaries are growing and currently the average salary in Russia resentation (CACI).
reached $830 per month. Average personal debt is $1100. It is possible to enter the Russian market directly, though the
In cities like Moscow or St. Petersburg, over half of the population most common route is via franchise. One challenge faced by
can be considered as middle class while the average salary in Mos- brands, other than real estate, is finding and selecting local part-
cow is over $1250 per month. ner. There are numerous groups with multiple international
Recently growth of salaries in the public sector exceeded the brands and varying experience and capability to choose from.
commercial sector resulting in a change of income structure and Big box retailers such as IKEA, OBI, and Auchan entered directly.
an increasing number of people visiting shopping centers. Large quality retailers such as H&M, Inditex, Uniqlo, Mango gen-
Russian people in general do not have a strong belief in savings erally have direct operations. A recent trend shows that brands,
instruments and prefer material goods/ As the result decrease of especially in the luxury market, are breaking away from their
consumer confidence in Russia often lead to increases in sales. local partners, examples include Chanel, Prada, Hermes and the
Swatch Group.
Future growth of the consumer credit sector offers upside to
consumer spending in Russia. Banks are actively offering credit The majority of retailers entering the Russian property market
cards in the region, which is affecting consumer habits. will lease property. Occupational leases are transparent and pro-
Apart from economic factors, shopping in Russia has a cultural vide retailers with secure tenure, however are considered to be
aspect to it: people in big cities do not have many options for more oriented toward the landlord.
spending leisure time and shopping centers offer a very attractive
environment. As a result, footfalls have remained rather solid even Major Russian Food Retailers:
during an economic downturn.
Х5 Retail Group, Sedmoy Kontinent, Dixi, O‘key, Lenta, Mag-
nit, Monetka, Vester
Major Russian Non-Food Retailers:
O‘stin, Oggi, Carlo Pazolini, Zolla, Lady & Gentelman, Snezhnaya
Koroleva, Eldorado, M‘Video, Tekhnosila, Svyaznoy, Sportmas-
ter, Metrika, Superstroy, Domocenter
International Retailers in Russia (a selection):
Prada, Gucci, Chanel, CK, Hermes, Zara, GAP, Next, Banana
Republic, American Eagle, Marks & Spencer, Mango, Uniqlo,
RUSSIA CONSUMER PATTERN New Yorker, Bestseller, Reiss, H&M, Calzedonia, Adidas, Nike,
Puma, Auchan, Stockman, Metro Group, MediaMarkt, Ikea, Cas-
110%
100%
torama, OBI, Leroy Merlen, Kesko
90%
80%
Food & Beverage Operators:
70% McDonald's, Burger King, KFC, Starbucks, TGI Fridays, Wendy‘s,
60% Dunkin' Donuts, Subway, Costa Coffee, Il Patio, Planeta Sushi,
50% Sbarro, Coffe House, Shokoladnitsa
40%
30%
20%
10% Since 2010 Tenant demand in Russia remains at a healthy level,
0% and is focused on established retail space offering high footfall
-10%
2006 2007 2008 2009 2010 2011 2012 YTD
and revenues. Large international and domestic retail chains
Goods and services Obligatory payments Savings
continued to expand and new entrants are expected.
Currency purchase Money on hand growth
Source:: Rosstat
CONSUMER CREDIT/GDP RATIO
120.0%
100.0%
80.0% Czech
Bulgaria
Germany
60.0% Spain
France
Italy
40.0%
Russia
UK
20.0%
0.0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Source:: EUROSTAT
4
5. RETAIL SPACE
ACROSS RUSSIA
2012-2013
CITIES QUALITY RETAIL STOCK PER ‘000 INHABITANTS
While the total population of Russia is 147 million people, over
97 million people live in cities of various sizes. Salaries, spending 0 200 400 600 800
and retail trade turnover are significantly higher in larger cities.
There is a huge gap in the economy, social life and behavior of Moscow
citizens of cities with populations over 1 million and, for exam-
St. Petersburg
ple, those with less than 500,000.
Novosibirsk
When comparing cities, we group them according to their size:
Ekaterinburg
MOSCOW
Nizhny Novgorod
By far the biggest, and in terms of consumer behavior it is com-
parable to Western European. There are more similarities be- Samara
tween Moscow and, say London than between Moscow and Omsk
Novosibirsk. Kazan'
MOSCOW REGION Chelyabinsk
Moscow Region is a conglomerate of smaller cities of roughly Rostov-on-Don
100,000 people greatly influenced by Moscow. Many Moscow
citizens have a summer house and spend a lot of time here. Also,
Ufa
most of the settlements have strong transit traffic, thus these can Volgograd
not be considered as closed communities. Perm
ST.PETERSBURG Krasnoyarsk
Often referred as the ―Northern capital‖. Its consumers are Voronezh
more conservative than those of Moscow, however this city is Saratov
the major tourist attraction in Russia due to its history and fine
architecture. Ranked second in terms of market size. Krasnodar
“Millionic” Cities (population over 1 million) Tolyatti
These are regional administrative centers with influential local Barnaul
administrations. These cities are more or less prosperous de- Ulyanovsk
pendent on the industry specializations of their regions. Izhevsk
Cities 500,000 + Vladivostok
These cities have to rely on their own resources, and thus are Yaroslavl
highly dependent on their industry focus. Those which are spe-
cialized on mining and exports generally do significantly better Irkutsk
than the ones focusing on processing. Economic drivers are the Tyumen
most important to look at when evaluating. Khabarovsk
Cities 300,000 - 500,000 Orenburg
These can range from rapidly developing markets to so-called Novokuznetsk
mono-cities, relying on one industry. Some cities are attractive
Kemerovo
for retail expansion while others have to develop first for several
years. The latter group cannot be compared to similarly sized Ryazan
cities in Western Europe. Astrakhan'
Cities 100,000 - 300,000 Penza
Very similar to the previous group but these cities are even less Naberegnie Chelni
attractive due to their small market size, and inability to support Lipetsk
major developments. When looking at such cities it is important
to consider their surroundings and the transit traffic.
Tula
Cities 50,000 - 100,000 “Millionic” Cities Cities 500,000 +
In most cases such cities are either located close to bigger ones
or are based on a single production facility. In both cases they
are too risky for any sort of modern retail development except The indicator is used as one of the tools for cities comparison in terms of the market saturation, level of competition
for supermarkets. and market development.
Estimation is based on the quality retail supply in each city.
Projects with the following characteristics are considered:
· recently constructed or reconstructed
· total area of more than 20,000 sq m
· professional concept
· effective floor plans
· anchor tenants
· international and federal brands among retail gallery tenants
Expert opinion of the Cushman and Wakefield specialists is to be mentioned among other parameters of the category
defining which is applicable in some cases.
Source: Cushman & Wakefield
5
6. RETAIL SPACE
ACROSS RUSSIA
2012-2013
MOSCOW
MOSCOW After the collapse of the USSR, the whole new industry of
modern retail was built from scratch with a major focus
2011 % Ref* on shopping malls.
POPULATION, ‗000 inhabitants 11,514 832.3%
RETAIL TRADE TURNOVER, mn USD 94,910 3147.5%
GUM is the oldest shopping centre in Moscow,
opened in 1893 and located in front of the Kremlin
AVERAGE MONTHLY SALARY, USD 1,265 147.1%
on the opposite side of the Red Square. It is an
RETAIL STOCK, sq m/ 1,000 citizens 303 90.4% iconic place for any retailer. The exceptional his-
*co mpared to Ekaterinburg (reference city fo r regio nal co mpariso ns) torical interiors and unique location attract luxury
brands, such as Emporio Armani, Partizia Pepe,
Moscow is the biggest consumer market in Russia. Ac- Alberta Feretti, Kenzo, Hugo Boss as well as such
cording to preliminary result of the 2010 census, 11.7 Zara, Moonson, Salamander on the upper floors.
million people live in the city. In terms of retail sales, it is
about 5 times bigger than St. Petersburg and over 20 TSUM, developed in 1908 is the oldest department
times bigger than other ―millionniki‖. store in Moscow. It‘s home to luxury brands, such
Muscovites are active consumers. They spend commonly as Yves Saint Laurent, Gucci, DKNY, Lanvin, Marc
over 70% of everything they earn on retail. In recent Jacobs, Michael Kors, Alexander McQueen.
times, people tend to spend more time in shops and malls Evropeisky is one the most popular shopping cen-
and it has become a cultural element of Moscow life. tres in Moscow. It is located near the Kievsky train
Streets (even prime corridors) are not well-suited for station and the busy Kievskaya tube station. It is a
shopping, however high foot traffic keeps street retail home for most international retailers in Moscow
rents high. Shopping malls are very popular in Moscow. from bridge brands to mass-market brands.
The consumption boom and consumer inflation drive and Metropolis shows the example of an extremely
stimulate retail sales growth. Successful retail businesses popular centre in a secondary location. It provides
are able to generate over $10,000 per sq m of annual a wide range of international retailers, most inter-
sales turnover from each square meter. national brands are to be found there.
There are 13 main retail streets in Moscow and 107
MEGA Malls are the developments of IKEA, which
quality shopping centres in Moscow.
has become the largest retail developer in Russia
Tverskaya Street is Moscow‘s busiest shopping with its MEGA shopping Malls. There are 3 MEGA
street and a ―must to visit‖ pedestrian area for all stores located in the Moscow suburbs on the dif-
visitors of the city. It enables a high foot flow and is ferent sides of the MKAD (Moscow ring road) – on
the target street for ambitious mass-market the north (MEGA Khimki), east (MEGA Belaya Da-
brands. Retailers include Zara, Benetton, Colin‘s. cha) and south (MEGA Teply Stan). Along with a
retail gallery including the main mass-market and
Stoleshnikov Pereulok and Petrovka Street are the
mid-market brands each MEGA store includes an
prime locations for luxury retailers (Louis Vuitton,
IKEA store, Auchan hypermarket and other an-
Chanel , Escada, Hermes). Among the new retailers
chors. Most international mass-market brands are
on Stoleshnikov are Lancel, Jimmy Choo, Miu Miu,
situated in the MEGA stores.
Prada.
Metropolis GUM Tverskaya street
6
7. RETAIL SPACE
ACROSS RUSSIA
2012-2013
MOSCOW
The vacancy rate for quality shopping centers in Moscow RETAIL SPACE. ‘000 SQ M GLA
remains less than 1% since late 2010. Rental rates for retail
gallery space in Moscow are in the range of $500-$4,000 (per sq Existing 3493
m per year) depending on the size of the retail unit and the type
Under Construction 1357
of retailer. Rents for quality retail space are stable in Moscow for
all sub-sectors. Demand for high streets and quality shopping Planned 2382
centres should remain strong, with many retailers in expansion
mode, While rents are largely expected to remain stable, further TOTAL, GLA,
DELIVERY
growth is possible in best Moscow shopping centers with a va- sq m sq m
cancy rate close to zero in the most sought-after locations. EXISTING
SELECTED RETAIL PROPERTIES
Okhotny Ryad 68,000 24,500 1997
CLICK FOR MEGA Tyoply Stan 195,000 145,000 2002
INTERACTIVE RETAIL Atrium 112,000 35,610 2002
MAP ON THE WEB
MEGA Khimki 238,000 177,000 2004
Erevan-Plaza 50,000 24,735 2006
2006-
MEGA Belaya Dacha 146,935 120,913
2008
Evropeysky 180,000 54,000 2006
Golden Babylon
241,000 170,000 2009
Rostokino
Metropolis 215,000 80,000 2009
PRIME RENTAL RATE* IN QUALITY SHOPPING CENTER Vegas 398,000 130,000 2010
RETAIL GALLERY , MOSCOW
AFIMall City 179,423 114,213 2011
UNDER CONSTRUCTION
$3,800
$3,750 Kaleidoskop 119,000 41,000 2012
$3,600
Otrada 100,000 85,000 2012
RIO (Leninskiy) 76,000 57,000 2013
$3,125
Mozaika 134,000 68,000 2013
$3,000
Aviapark / Hodinskoe
$2,600 600,000 240,000 2013
Pole Project
$2,500 Vesna! (Finstroy on
120,000 57,335 2014
Altufievskoe)
2006 2007 2008 2009 2010 2011 2012 Vegas City 231,253 113,402 2014
Vegas Kuntsevo 283,456 111,398 2014
VTB Arena
* Base rental rate for 150-200 sq.m unit in the ground floor of retail gallery of prime Moscow shopping center, USD 169,700 49,000 2016
per sq m per annum, triple net (Petrovskiy park)
PLANNED
Kapitoliy (Kuntsevo) 235,000 58,900 2013
STREET RETAIL RENTAL RATES*, MOSCOW
River Mall 258,155 91,200 2014
(USD PER SQM PER ANNUM, TRIPLE NET)
RENTAL RATES IN QUALITY SHOPPING CENTER RETAIL
STREET USD/sq. m/annum 2012 TREND GALLERY, MOSCOW (USD PER SQM PER ANN UM, TRIPLE NET )
1st Tverskaya Yamskaya $1,500 - $2 ,500 up BUSINESS GLA, SQ M
Arbat $1,500 - $2,500 up RETAIL GALLERY MINI ANCHORS
<100 100 - 300 300 - 800 800 - 1,500
Garden Ring $1,000 - $2,500 stable
Kiosks $2,000
Kutuzovsky Prospekt $1,000 - $2,500 stable
Cellphones $3,500
Kuznetsky Most $2,000 - $2,500 stable
Drugstore $1,200-
Leningradsky Prospekt $1,000 - $2,000 stable $1,500
$1,200-
Banks
Leninsky prospect $1,000 - $2,000 stable Restaurant $1,500
$1,200 $600-$1000
Prospect Mira $1,200 - $2,000 stable Textiles $1,200 $800
Novy Arbat $1,500 - $2,500 up Books $1,000 $500-$600 $400 $300
Petrovka $3,000 - $4,000 up Clothing and Footwear $1,200 $800 $600 $400
Pyatnitskaya $1,500 - $2,000 stable White and Brown $500
Tverskaya $3,500 - $4,500 up Supermarket $750
Stoleshnikov per. $3,500 - $4,500 up Source: Cushman & Wakefield
7
8. RETAIL SPACE
ACROSS RUSSIA
2012-2013
ST. PETERSBURG
ST. PETERSBURG The development of modern retail real estate in St. Pe-
tersburg only started in 2006 and has resulted in the com-
2011 % Ref* pletion of a large amount of shopping centre space though
POPULATION, ‗000 inhabitants 4,849 350.5% it varies in quality. Given its large local population and rela-
RETAIL TRADE TURNOVER, mn USD 22,557 748.1%
tively high salary levels, the city is a target for expansion by
a number of international and national Russian retail op-
AVERAGE MONTHLY SALARY, USD 895 104.1%
erators. As a result St. Petersburg is a city with one of the
RETAIL STOCK, sq m/ 1,000 citizens 437 130.2% highest provisions of retail space per citizen in Russia.
*compared to Ekaterinburg (reference city for regional comparisons)
Shopping centers in the city can be defined by several
St. Petersburg is Russia's second-largest city and the most groups:
important Russian port on the Baltic Sea. The city centre
Mid and large-scale quality projects (GLA >50,000 sq m)
is registered as a UNESCO World Heritage site as a re-
sult of its beautiful architecture together with its network located closer to city borders (e.g., MEGA Dybenko,
of canals and waterways. The consumer market is large MEGA Parnas, Raduga, Leto):
and includes significant numbers of tourists to add to Adjacent to the Moscow railway station, Galeria
spending by the local population. St. Petersburg‘s trans- (93,000sq.m GLA) houses high street brands such as To-
portation infrastructure is not as well developed as Mos- shop, Levi‘s, Mexx and French Connection, supermarket,
cow‘s so consumers prefer to work, go shopping and find food court, movie theatre, bowling alley and restaurants.
entertainment close to their homes. People living in the When it opened in 2010 Galeria established a new stan-
southern part of the city rarely visit the northern part and dard of quality in the St. Petersburg retail market.
vice versa. At the core of Nevsky Center is Stockmann Group's
The main high street retail corridors are Nevsky Prospect, flagship department store in Russia. The Finnish-based
Bolshoy Prospect and Zagorodny Prospect. Among others company Stockmann which has been operating in St. Pe-
are 6-7 Lanes of Vasilievsky Ostrov, Vladimirsky and tersburg since 1993 opened the Stockmann Nevsky Cen-
Moskovsky Prospects, Rubinstein Street, Sadovaya Street ter in 2010, including not only the Stockmann depart-
and Malaya Sadovaya Street. ment store but also a multi-level shopping mall of some
Nevsky Prospect is the focus of the city‘s retail, 45,000sq.m GLA behind a historic facade from the early
entertainment and night life. The main tourist at- 19th Century.
traction routes go through and near the street. It is Smaller shopping centers located in the center developed
not only Nevsky Prospect itself, but also the adja- more than 5 years ago (and even earlier). There are only a
cent smaller streets and lanes in the area close to it few of them due to the limited supply of development sites
which are popular locations for shops, restaurants and to the serious restrictions on development and rede-
and coffee shops (Maly and Bolshoy Konyushenny, velopment (such as Sennaya, PIK, Gostinny Dvor).
Mikhailovskaya, Griboedova Canal, etc.). Luxury Middle and small-sized quality projects, majority of them
brands are mixed with mass-market retailers. The located close to the city‘s center (e.g. June, Atmosphera,
highest concentration of luxury brands is at the Rodeo Drive) which can be classified as neighborhood
beginning of Nevsky Prospect (Bosco Di Ciliegi, centers targeting mostly their district.
Kenzo, etc.) and Bolshaya Konishennaya street
(DLT/TSUM, Louis Vuitton and others).
Bolshoy prospect and Moscovsky prospect are
strong retailing areas with a large local catchment
population. Retailers on these streets include
McDonalds, Levi‘s, Villeroy & Boch, Mascotte, Ile
De Beaute, Salamander, Toto Group, Yves-Rocher,
Carnaby and TJ Collection.
Rubinshteina Street is a ―restaurant street‖ with a
great variety of cafes, pubs, night clubs, theatres
Stockmann Nevsky Nevsky Prospekt
8
9. RETAIL SPACE
ACROSS RUSSIA
2012-2013
ST. PETERSBURG
CLICK FOR INTERACTIVE RETAIL MAP RETAIL SPACE. ‘000 SQ M GLA
ON THE WEB
Existing 2119
Under Construction 364
Planned 188
SELECTED RETAIL PROPERTIES
TOTAL, GLA,
DELIVERY
sq m sq m
EXISTING
Grand Canion 150,000 53,000 2005
MEGA Parnas 130,000 84,000 2006
MEGA Dybenko 130,000 85,000 2006
Raduga-Piter 85,000 75,000 2007
Galeria 192,000 93,000 2010
Stockmann Nevsky
97,000 45,000 2010
Centre
Leto 116,000 80,000 2011
RIO 70,000 52,500 2012
UNDER CONSTRUCTION
Kontinent na
AVERAGE RENTAL RATE* IN QUALITY SHOPPING 82,000 20,000 2012
Bukharestskoy
CENTER RETAIL GALLERY , MOSCOW
Mezhdunarodniy 46,400 37,000 2012
$1,160 $1,170
Balkaniya Nova
74,500 18,600 2012
(phase 2)
$1,130
Mandarin 85,000 38,250 2013
$1,090
Zhemchuzhnaya Plaza 140,000 45,100 2013
$1,000 PLANNED
Clover Plaza 366,000 27,800 2013
Outlet Village
20,000 20,000 2014
2008 2009 2010 2011 2012 Pulkovo(Hines)
Fashion House 37,000 28,000 2014
* Base rental rate for 150-200 sq.m unit of retail gallery of quality St.Petersburg shopping center, USD per sq m per
annum, triple net Apraksin Dvor 347,500 80,000 2016
Source: Cushman & Wakefield
Leto MEGA Dybenko Galeria
Source: Cushman & Wakefield
9
10. RETAIL SPACE
ACROSS RUSSIA
2012-2013
MOSCOW REGION
MOSCOW REGION RETAIL SPACE. ‘000 SQ M GLA
The Moscow Region is one of the largest in Russia with a 180,000 250
Population
population of 6.64 million people. It includes 80 towns, 16 160,000
Population, '000 inhabitants
of which have over 100,000 inhabitants. About 83% of the 140,000
Under construction
200
GLA
population lives in these towns, and 63% are of working Existing GLA
120,000
age. 150
GLA, sq m
100,000
Retail in the Moscow Region is different from Moscow.
Average monthly income per capita is lower than in the 80,000
100
capital. However, about 1 million people commute daily to 60,000
Moscow. Also, many Muscovites tend to buy apartments 40,000 50
or townhouses in the Moscow Region due to lower 20,000
prices. 0 0
Sergiev…
Solnechno…
Orekhovo…
Domoded…
There is an on-going discussion that Moscow should be
Electrostal
Reutov
Dmitrov
Zelenograd
Lytkarino
Krasnogorsk
Odintsovo
Chekhov
Lyubertsy
Noginsk
Stupino
Zhukovsky
Kolomna
Podolsk
Solntsevo
Pushkino
Balashikha
Mytischi
Klimovsk
Vidnoe
merged with the Moscow Region to ensure proper urban
planning, but administrations on both sides resist this sug-
gestion.
SELECTED RETAIL PROPERTIES
Retail market development is mostly within 50 km of the
GLA,
MKAD (ring road on the boundary of Moscow), due to CITY NAME DELIVERY
sq m
the high-density population in this area. The retail market
of the Moscow Region can be seen from two angles: areas EXISTING
of development near the MKAD and distant developments Mytischi XL2 16,000 2003
targeted at the region‘s towns. Shopping centers near the Mytischi XL3 25,000 2005
MKAD that are aimed at Muscovites have larger retail
Mytischi Krasny Kit 18,700 2006
spaces and various types of stores. Shopping centers in
more distant areas are either small or of low quality. Mytischi Krasny Kit 18,700 2006
Electrostal Elgrad 45,000 2008
Most large-scale projects are concentrated along the main
highways; family shopping centers are generally located in Kolomna RIO 31,500 2008
municipal centers with easy access. We expect that the Orekhovo-
Orekh 16,000 2008
southern part of the Moscow Region will be more sup- Zuevo
plied with retail centers as it has the highest population Reutov Ekvator 15,000 2009
density. Zhukovsky Aviator 18,750 2010
Rental rates for retail gallery space in the Moscow Region Chekhov Karnaval 23,000 2011
mostly correlate to those in Moscow ($500-$3,500 per Sergiev Posad Aprel 24,580 2011
sq m per year) with some exceptions in districts with low
Domodedovo Torgovy 22,500 2012
potential. For anchor stores, rental rates on average are
Krasnogorsk Kvartal
June 15,000 2012
the same as in Moscow.
Taking into consideration the growing retail turnover, UNDER CONSTRUCTION
personal income and population, there is obviously a po- Mytischi June 75,000 2012
tential for the development of more quality retail space. Mytischi Krasny Kit 2 35,000 2012
Expansion of Moscow at the expense of the Moscow Re- SC on
Korolev 22,500 2012
gion will not change the retail scene dramatically as the Kosmonavtov
Region is already very integrated with the capital. Krasnogorsk Komsomolec 15,000 2013
Stupino SC by Torgoviy 24,000 2013
Kvartal Source: Cushman & Wakefield
XL 3 (Mitishi) Elgrad (Electrostal) RIO (Kolomna)
10
11. RETAIL SPACE
ACROSS RUSSIA
2012-2013
―MILLIONNIC‖ CITIES
EKATERINBURG
CITY
Ekaterinburg is a large transport and logistics hub of the
Trans-Siberian international transport corridor. It is an
industrial center (metallurgy, light and heavy machinery,
military and chemical industries are the main economy
drivers). It is the third business and production center of
Russia after Moscow and St. Petersburg, often being re-
ferred to as the third capital of Russia. Ekaterinburg is the
second in per-capita income and retail trade turnover as
well as the most expensive city in Russia after Moscow.
SHOPPING CENTERS 2011
The most active development of the retail market took POPULATION, ‗000 inhabitants 1,383
place in 2006 and 2009 when the majority of quality shop-
RETAIL TRADE TURNOVER, mn USD 3,015
ping centers have been delivered. Thus, during the last five
years, the supply of quality retail space per inhabitant in- AVERAGE MONTHLY SALARY, USD 860
creased 1.8 times. Although about half of quality shopping RETAIL STOCK, sq m/ 1,000 citizens 336
centers were delivered during the crisis and the early re-
RETAIL SPACE. ‘000 SQ M GLA
covery period (between 2009 and 2010), supply is still
limited with further opportunities for development. The
shopping center pipeline is healthy with several centers Existing 464
under construction.
Under Construction 265
RETAIL STREETS
The main street retail corridors are Lenina Prospect, Planned 241
Vainera Street and 8 Marta Street. Low availability of qual-
ity retail spaces both in shopping centers and in retail Source: Cushman & Wakefield
streets is a reliable indicator of high retailer‘s interest in
Ekaterinburg.
RETAILERS
Ekaterinburg is the third retail market for any retailer
(after Moscow and St. Petersburg). Most of local and in- SELECTED RETAIL PROPERTIES
ternational retailers are already in the city. TOTAL, GLA,
DELIVERY
Greenvich
sq m sq m
EXISTING
Park House 70,000 31,344 2005
MEGA - Ekaterinburg 135,500 100,000 2006
Greenvich (phase III) 70,000 49,000 2009
Alatir' (Sedmoe Nebo) 80,000 37,000 2009
KomsoMall (Rock-n-
67,000 41,000 2010
Mall)
UNDER CONSTRUCTION
Evropeyskiy (former
104,000 70,397 2012
Prozma)
Raduga Park (1 phase) 113,163 56,038 2012
Ekaterininsky 140,000 82,000 2014
Akademichesky (1
6,794,000 50,000 2015
phase)
PLANNED
Kirovsky district 50,000 30,000 2013
Greenvich (phase IV) 60,000 2014
Akademichesky (2
5,950,000 100,000 2030
phase)
CLICK FOR INTERACTIVE RETAIL MAP
Source: Cushman & Wakefield
11
12. RETAIL SPACE
ACROSS RUSSIA
2012-2013
―MILLIONNIC‖ CITIES
NIZHNIY NOVGOROD
CITY
Due to its geographic location, Nizhniy Novgorod repre-
sents a bridge between the European and Asian parts of
Russia. Traditionally it is an industrial and scientific center
with a highly qualified workforce. It is one of the automo-
bile production centers in Russia. The city has extensive,
densely populated suburbs, the total agglomeration in-
cludes about 2 million citizens which takes it to fourth
place in Russia by population (after Moscow and St.-
Petersburg).
SHOPPING CENTERS
2011 % Ref*
Quality shopping centers are concentrated in the Nagor-
POPULATION, ‗000 inhabitants 1,260 91.1%
naya part of the city, whereas Zarechny part and Zaoksky
district are lacking quality shopping centers. A number of RETAIL TRADE TURNOVER, mn USD 2,735 90.7%
notable projects being frozen during the crisis might come AVERAGE MONTHLY SALARY, USD 719 83.6%
to the market soon. RETAIL STOCK, sq m/ 1,000 citizens 297 88.4%
RETAIL STREETS *compared to Ekaterinburg (reference city for regional comparisons)
The major street retail areas are located along Maksima RETAIL SPACE. ‘000 SQ M GLA
Gorkogo Street and Belinskogo Street in the Nizhe-
gorodskiy district, and along Sormovskoe shosse in the
Sormovskiy district. There is a small pedestrian zone in Existing 374
the city center (Pokrovskaya Street) that has a number of
street shops and different cafes and restaurants. The al- Under Construction 140
ready-existing quality centers are fully occupied. Planned 52
RETAILERS
The main retail operators, such as Auchan, IKEA, OBI, Source: Cushman & Wakefield
Sportmaster, Real, Perekrestok, Detskiy Mir, M.Video,
Metro Cash & Carry, Starik Khottabych, Karusel, are al-
ready present in the city.
SELECTED RETAIL PROPERTIES
Shokolad
TOTAL, GLA,
DELIVERY
sq m sq m
EXISTING
Etazhi 28,200 16,300 2003
Shokolad 25,240 16,831 2003
Respublika 34,000 22,100 2005
Zolotaya milya 32,000 17,500 2006
MEGA - Nizhnyi
130,000 101,000 2006
Novgorod
Fantastika 160,000 87,000 2008
NASH (former
Sormovskiy (Mosmart 38,400 32,300 2011
Jelmoli))
Sedmoe Nebo 80,000 60,800 2012
UNDER CONSTRUCTION
RIO (Ogni Stolizy) 100,000 68,000 2012
Nebo 132,416 72,000 2013
PLANNED
Power Center 117,000 52,000 2013
CLICK FOR INTERACTIVE RETAIL MAP
Source: Cushman & Wakefield
12
13. RETAIL SPACE
ACROSS RUSSIA
2012-2013
―MILLIONNIC‖ CITIES
SAMARA
CITY
Samara is the largest city of the Volga region. Its gross
regional production includes metal work, machinery, elec-
tronic and optical products, and aircrafts. Transport infra-
structure includes railroads, river transport (by Volga,
which is the main transport river in the central Russia),
the international airport Kurumoch, and federal highways
(M5, M32).
SHOPPING CENTERS
There are several clusters where the majority of shopping
centers are concentrated – about 15 of them are located 2011 % Ref*
along Moskovskoye Shosse and 6 more are on Novo-
POPULATION, ‗000 inhabitants 1,165 84.2%
Sadovaya Street. The biggest project in the city is Mega
Samara. Opening of the shopping center has been delayed RETAIL TRADE TURNOVER, mn USD 2,662 88.3%
several times since 2007. It was finally opened in AVERAGE MONTHLY SALARY, USD 681 79.2%
2011.Currently a number of announced large-scale pro- RETAIL STOCK, sq m/ 1,000 citizens 442 131.6%
jects are on hold due to different reasons. The pipeline is
*compared to Ekaterinburg (reference city for regional comparisons)
not noticeably high.
RETAIL SPACE. ‘000 SQ M GLA
RETAIL STREETS
Leningradskaya Street as well as Kyibisheva, Molodog-
vardeiskaya, Samarskaya streets are among the most Existing 514
popular retail corridors.
Under Construction
RETAILERS
Main retail chains such as Perekrestok, Pyaterochka, Eldo- Planned 14
rado, M.Video, Sportmaster, METRO Cash&Carry,
Auchan, IKEA, Media Markt, Leroy Merlen are currently in Source: Cushman & Wakefield
the city.
SELECTED RETAIL PROPERTIES
TOTAL, GLA,
DELIVERY
sq m sq m
EXISTING
Moskovsky (Mega
140,000 79,000 1996
Complex)
Park House Phase I 20,600 17,800 2002
Kosmoport KC-92 23,200 15,800 2006
Mega City 52,400 36,000 2006
Bristol 30,360 22,581 2007
Park House Phase II 36,000 27,400 2007
Kosmoport 127,000 101,000 2007
Most 27,200 23,120 2009
Samolet 42,739 32,054 2010
Viva Land 68,000 47,600 2010
MEGA - Samara 130,500 102,000 2011
PLANNED
Clover Citycenter 82,800 13,800 2014
CLICK FOR INTERACTIVE RETAIL MAP
Source: Cushman & Wakefield
13
14. RETAIL SPACE
ACROSS RUSSIA
2012-2013
―MILLIONNIC‖ CITIES
OMSK
CITY
Omsk is the second largest city in the Asian part of Russia,
after Novosibirsk. The importance of the city has been
growing with development of the Transsib railroad con-
necting central Russia with Siberia, and now it is the main
logistic route in the region. Now Omsk is considered a
significant industrial center (metal, chemical, petrochemi-
cal, space industries).
SHOPPING CENTERS
Compared to other cities with populations over 1 million,
Omsk‘s share of quality shopping centers is not large. The 2011 % Ref*
delivery of MEGA SC at the end of 2009 doubled the ex- POPULATION, ‗000 inhabitants 1,154 83.4%
isting quality stock and noticeably restructured the retail
RETAIL TRADE TURNOVER, mn USD 1,353 44.9%
space in the city. Most quality retailers are located there,
and some of them even closed other stores in other loca- AVERAGE MONTHLY SALARY, USD 636 74.0%
tions in the city. There is a significant list of announced RETAIL STOCK, sq m/ 1,000 citizens 336 100.2%
retail projects but most of them are currently on hold. *compared to Ekaterinburg (reference city for regional comparisons)
RETAIL STREETS RETAIL SPACE. ‘000 SQ M GLA
The main retail streets in the city are Lubinsky Prospect (a
part of Lenina Street) in the historic city center, which is Existing 388
planned to become a pedestrian area soon, and Torgovaya
Street located near the largest open market of the city. Under Construction 122
RETAILERS Planned 101
Most retailers are concentrated in MEGA and the majority
of them are MEGA partners such as IKEA, Auchan, Leroy Source: Cushman & Wakefield
Merlin, Media Markt, Sportmaster, Adidas, Mango, Ecco,
Zara, Bershka, etc.
MEGA - Omsk
SELECTED RETAIL PROPERTIES
TOTAL, GLA,
DELIVERY
sq m sq m
EXISTING
Kontinent 206,200 160,000 2001
Kaskad 32,000 21,000 2005
AT-market 45,000 32,000 2007
MEGA - Omsk 170,000 127,300 2009
Millenium 68,000 23,000 2010
Festival (Astore Plaza) 36,000 25,000 2010
UNDER
CONSTRUCTION
Mayak (phase III) 28,000 18,750 2012
Arena Mall 135,000 103,000
PLANNED
CLICK FOR INTERACTIVE RETAIL MAP Park 300-letia Omska 90,000 34,517 2016
Source: Cushman & Wakefield
14
15. RETAIL SPACE
ACROSS RUSSIA
2012-2013
―MILLIONNIC‖ CITIES
NOVOSIBIRK
CITY
Novosibirsk is the third city in Russia by population (after
Moscow and St.-Petersburg), the cultural, economic and
industrial center of Siberia. Novosibirsk is located at the
center of important trade corridors (Middle Asia, South-
East Asia, Northern Russia, Russia‘s Far East, Europe) and
the largest logistics hub in Siberia, with high-quality ware-
houses and regional logistics centers. Retail turnover in
the city is on the fourth place in Russia.
SHOPPING CENTERS
There are several large-scale quality shopping centers in 2011 % Ref*
the city, including MEGA, Sibirky Mall and Aura retail cen-
POPULATION, ‗000 inhabitants 1,474 106.5%
ters. Retail stock grew up even in the crisis period - sev-
eral quality shopping centers were delivered, such as RETAIL TRADE TURNOVER, mn USD 2,892 95.9%
Golden Park, Versal and Aura. The pipeline is healthy - a AVERAGE MONTHLY SALARY, USD 770 89.5%
number of shopping centers are in pipeline, but the major- RETAIL STOCK, sq m/ 1,000 citizens 216 64.4%
ity of them are on the planning stage. International inves-
*compared to Ekaterinburg (reference city for regional comparisons)
tors, developers and consultants are involved in new de-
velopments in the city. The city is in high demand among RETAIL SPACE. ‘000 SQ M GLA
retail operators.
RETAIL STREETS Existing 318
The main retail corridors in the city are Vokzalnaya Magis- Under Construction 45
tral, Krasniy Prospect and Karl Marx Square and Prospect.
There is a unique retail area on Karl Marks Prospect, Planned 221
where about 50 footwear stores are located in a 500
meter stretch of the street. Source: Cushman & Wakefield
RETAILERS SELECTED RETAIL PROPERTIES
Many international and well-know Russian retailers are in TOTAL, GLA,
DELIVERY
the city. MediaMarkt, Home Center, Metro Cash & Carry, sq m sq m
Auchan, Okey, Lenta, Bachetle are among them.
EXISTING
Royal Park
Royal Park 70,000 35,000 2007
MEGA - Novosibirsk 140,000 103,000 2007
Kontinent-3 26,600 19,800 2008
Sibirskiy Mall 67,000 40,000 2008
Golden Park 30,000 18,000 2010
Versal 40,000 18,875 2010
Sun City (OMEGA
86,500 23,600 2011
Plaza)
Aura 150,574 60,439 2011
UNDER CONSTRUCTION
Evropeyskiy 87,000 45,000 2013
PLANNED
Plotina 27,400 15,000 2013
Planeta 175,000 71,000 2013
Clover Citycenter, 1st 90,450 36,660 2014
phase Berdskoe
SC on
65,000 61,000 2014
Shosse
TSUM reconstruction 113,204 37,258
CLICK FOR INTERACTIVE RETAIL MAP
Source: Cushman & Wakefield
15