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CBRE analyzed outlet market in Russia

-The largest number of outlet openings in the Russian history is expected till the end of 2019: the market is expected to grow by 95.7 thousand sq m -

Moscow, November 13, 2018 – According to the latest report from global real estate advisor CBRE, the Russian outlet market is not saturated yet. Currently saturation is 0.8 sq m per 1 thousand inhabitants, while in Poland it is 7.8 sq m, in Italy – 13.1 sq m, in the United States - 27.2 sq m.

At the same time, the average sales from 1 sq m in Russian outlets is comparable with European countries and exceeds the ones in the United States: in Russia it is 4.1€ thousand per sq m, in Poland – 2.3€ thousand sq m, in the United States – 3.9€ thousand sq m, in France – 4.2€ thousand sq m, in Italy – 4.9€ thousand sq m.

Overview of the global outlet market

Source: CBRE, November 2018

According to CBRE’s forecast, the largest number of outlet openings in the Russian history is expected till the end of 2019, both in terms of the number and size of the facilities being commissioned and in terms of their geography. For the first time in such a short period of time, 4 outlets are planned to be commissioned which will cause market growth by 95.7 thousand sq m and almost double outlet area in Russia.

New areas will be located mostly in Moscow (65 thousand sq m) and St. Petersburg (20.3 thousand sq m), but we will witness the opening of the first regional outlet in Yekaterinburg (10.3 thousand sq m) as well.

Source: CBRE, November 2018

Planned openings 2018 in Yekaterinburg: Brand’s Stories (GLA 10,300 sq m); 2019 in Moscow Novaya Riga Outlet Village (GLA 38,000 sq m) and Outlet Village Hines Moscow (GLA 27,000 sq m); 2019 in St. Petersburg: Fashion House Outlet Saint Petersburg (GLA 20,300 sq m).

Provided all the new facilities are commissioned as planned, outlet saturation in Russia will make 1.6 sq m per 1 thousand inhabitants

Marina Malakhatko, Director, Head of Moscow Retail CBRE:

“We see an obvious upward trend in trade formats that sell discounted goods. Almost two-fold growth of outlets goes along with the development of off-price stores and the opening of such facilities as, stage II of the Ordzhonikidze discount center. They will make a certain competition to outlets due to their location, and since in existing outlets the mass market occupies about 50%, they will draw a certain part of the consumer audience, which is focused on this price category of goods. Nevertheless, outlets have good prospects. First of all, due to the middle-up and luxury brands represented there”.