A total of 154 lease agreements were signed, roughly 60 percent of which were renewals. That marks a 26 percent increase in lease agreements compared to the first half of 2025.
- 154 lease agreements covering 47,000 square meters of retail space
- Flexible store concepts, brands moving from pure online retail into physical stores, and shop-in-shop models are shaping leasing activity
- Stable footfall and rising sales at managed shopping centers
- Re-leasing processes need to be managed earlier and more actively than before
“The leasing market is proving considerably more stable than it was just a few years ago, despite ongoing macroeconomic uncertainty in Germany. At the same time, we’re seeing that owners and landlords now have to act far more actively to position their properties for long-term success,” says Lars Jähnichen, Managing Director of IPH Group. Retailers are scrutinizing locations more closely and placing higher demands on space quality, cost efficiency, and flexibility.
Flexible store concepts shaping the market
More and more retail companies are moving away from standardized store sizes in favor of location-specific concepts. Large-format retailers in particular are increasingly tailoring their space to the surrounding catchment area and local demand.
This is producing commercially viable solutions for both retailers and property owners. At the same time, shop-in-shop concepts are gaining significant traction. Retailers are integrating additional concepts into their existing space, or handing over part of their footprint to other brands.
“Shop-in-shop concepts are no longer just a stopgap solution. Done right, they boost space efficiency and open up access to new customer groups at the same time. What matters most is that the concepts involved make sense together and create real synergies.”
Lars Jähnichen, Managing Director of IPH Group
Another trend is the move into physical retail by brands that had previously focused solely on e-commerce. By opening brick-and-mortar locations, these brands aim to raise their visibility, create more direct customer experiences, and build stronger ties with their target audience.
At the same time, they’re using physical retail as a natural complement to their omnichannel strategy, tapping into additional sales potential.
International concepts bring new momentum
IPH Group is also seeing growing market entry from new retail concepts. Alongside international grocery brands, Korean beauty labels as well as lifestyle and non-food concepts are increasingly establishing a presence in German city centers and shopping centers.
They’re broadening the retail mix and appealing especially to younger shoppers. Influencer marketing has proven particularly effective with this younger audience, driving noticeable sales growth for the brands being promoted, and boosting footfall in the process, which benefits the entire location.
Stabilization in the leasing market
According to IPH, rental levels have now largely stabilized. While some long-term legacy leases dating back to before the Covid-19 pandemic are seeing lower follow-on rents, new leases and renewals signed in recent years have overall trended positively.
Performance at the shopping centers managed by IPH Group backs up this trend: visitor footfall is holding at last year’s level, while sales across the overall portfolio are running slightly higher, even adjusted for inflation.
“Successful leasing means actively sharpening a location’s profile. Retailers invest where properties are being professionally developed and where owners are willing to invest in quality of stay, design, and modern space concepts,” says Jähnichen.
Leasing begins long before lease expiration
As decision-making processes take longer, proactively managing existing leases is becoming more important than ever. In practice, that means monitoring lease agreements, performance data, and space development early, so that renewals or re-leasing can happen with as little vacancy as possible.
“Proactive leasing management within a center prevents unused space, drives footfall, strengthens tenant performance, and protects long-term property value. That makes it a decisive value driver for investment success. It takes more than market knowledge to get this right. Above all, it requires ongoing dialogue with tenants and owners, along with a solid analysis of the economic performance of each individual location. It’s that depth of understanding that ultimately determines the long-term success of a retail property.”
(dp)
