Retail market in the Silesia agglomeration

CB Richard Ellis* (CBRE) released a report on a retail market in Poland. The report characterizes the eight biggest country’s retail markets including the Silesia agglomeration. The company describes the agglomeration as the second largest urban area of Poland with dynamic development of the sector and predicts a further growth of its importance on the retail map.

According to CBRE the Silesia agglomeration currently offers 909 000 sq. meters of modern retail stock (at the end of H1 2011 shopping center stock in Poland amounted to 8,5 million sq. m.), having the second largest retail space volume in Poland, after Warsaw. Also, the company points out that Silesia City Center is still the most popular retail destination in the region, though, a number of competitors is rising, with Neinver’s Galeria Katowicka at the head, being currently under construction. However, CBRE specialists expect coexistence between this two retail destination instead of the competition and compare it to the Złote Tarasy and Arkadia shopping malls both located in Warsaw.

A vacancy ratio is currently at a level of 3%. The offer of regional shopping centers is concentrated primarily in medium and large schemes. However, as we can read in the report, the Silesia market still boasts significant prime retail development opportunities both in terms of new locations (Tarnowskie Góry, Tychy) as well as the concepts (e.g. convenience centers in a number of neighbourhoods). Helical’s Europa Centralna in Gliwice and Galeria Katowicka are the two largest currently constructed schemes, framing the spectrum of Silesia’s retail formats between the large retail park and the innercity gallery focused on railway commuters.

Prime rental rates in schemes such as Galeria Katowicka as well as the Silesia City Center extension are currently at a level of EUR 45 – 55 /sq. m/month. Service charges are between EUR 5 – 8 /sq. m/month. Rents for units in retail parks range from EUR 9 – 11 /sq. m/month. The high street retail rents have seen some declines to the current EUR 18 – 45 /sq. m/month.

* CB Richard Ellis Group, a company headquartered in Los Angeles, is one the world’s largest commercial real estate services firm. It has approximately 31 000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through more than 300 offices (excluding affiliates) worldwide.

© CB Richard Ellis; selected retail schemes in the Silesia agglomeration
© CB Richard Ellis; selected retail schemes in the Silesia agglomeration