ACROSS | The European Retail Real Estate Magazine


Popular Stockholm

Stockholm is the most balanced market in terms of size, stability, opportunities, and returns, making it a haven for most investors interested in shopping center investments Image: Marcel Klinger /

According to Savills, the Swedish capital is currently the most attractive destination in Europe for shopping center investments due to its reputation as a “safe haven” and its relatively affluent population.

In its latest analysis, the European Research team at Savills illuminated the shopping center investment sector in 23 European cities based on four market parameters: size, stability, sales opportunities, and potential returns.

The analyzed cities were: Amsterdam, Athens, Berlin, Breslau, Brussels, Dusseldorf, Edinburgh, Helsinki, Copenhagen, Krakow, Lodz, Lyon, Madrid, Milan, Manchester, Marseille, Munich, Oslo, Paris, Poznan, Stockholm, Warsaw, and Vienna.

The “Savills 2016 European Shopping Center Investment Benchmarking Report” puts Stockholm in the top spot due to its solid economic conditions. Warsaw, London, Amsterdam, and Paris were close behind.

Lydia Brissy, Director of European Research at Savills, commented: “Stockholm is the most balanced market in terms of size, stability, opportunities, and returns, making it a haven for most investors interested in shopping center investments. Considering all the factors relevant to our benchmark, Stockholm comes out on top. Returns there are higher than in London and Paris, which also enjoy reputations as havens.”

A small but wealthy city

With a per capita GDP of €59,000, Stockholm is a small but wealthy city. Moreover, its retail sales level per capita, at €10,080, places Stockholm in fourth place after Dusseldorf, London, and Paris.

In addition, Savills expects a significant, 2.6% annual increase in retail sales through 2021. Both total and per capita shopping center areas are high, at 1.4 million sq m and 0.635 sq m per person, which opens plenty of buying opportunities for investors.

Unibail-Rocamco’s Mall of Scandinavia located in Solna Municipality in Stockholm was inaugurated on November 12, 2015. Image: Mall of Scandinavia

Unibail-Rocamco’s Mall of Scandinavia located in Solna Municipality in Stockholm was inaugurated on November 12, 2015. Image: Mall of Scandinavia

Warsaw is close behind Stockholm in the Savills Shopping Center Benchmark. “The typical investor interested in the Warsaw shopping center market is opportunistically oriented, as the strength of the market is mainly dependent on sales opportunities and potential returns,” Brissy continued.

Annual retail sales in Warsaw are relatively low compared to other cities, but the Polish capital’s consumers spend a lot. According to Savills, this is particularly significant against the backdrop of the city’s relatively low (compared to most of the other European cities in the study) per capita GDP of €31,730.

In 2016, retail sales per capita in Warsaw averaged €9,740, putting it 5th among the 23 cities analyzed. For the next five years, this spend is expected to increase rapidly, by an average of 4.3% per year—the second-highest growth after Krakow (4.6%). Warsaw will thus become the city with the highest sales per capita (€11,650) by 2021. The vacancy rate is low and international brands are taking an active interest in the market.

“Low unemployment, a strong GDP growth forecast, and its large population lead to the conclusion that, in terms of size, the Warsaw market can compete with core markets in short and the medium term,” said Brissy.

Shift in investor demand

London was long the European city with the highest shopping center investment volume. In 2011, the proportion of the total investment volume going to the 23 European cities in the analysis that went to London was still 26%.

Since the beginning of 2016, this proportion has dropped to about 9%, while Krakow and Helsinki are now ahead with 22% and 13%, respectively. Regarding the Savills’ benchmarks, London has the highest per capita GDP (€89,400) of the 23 cities. Its total retail sales put it at 2nd place behind Paris and, in terms of sales per capita, London also ranks second behind Dusseldorf (€10,400).

“The London market, however, is more volatile than Stockholm’s, which may be positive for investors with short-term investment objectives,” said Brissy. “What makes London so attractive for investors, however, is the size of the market and its per capita GDP.”

Oliver Fraser Looen, Director Cross Border Retail at Savills, commented: “Demographic change, urbanization trends, and changing consumer behavior are affecting the landscape of retail sales in Europe and we are seeing a shift in investor demand as a result. We expect growing interest in shopping centers in less traditional markets like Warsaw and Amsterdam in 2017. Those two markets are relatively small, but they have solid fundamentals and therefore offer investors a good price-performance ratio. We also believe that the Nordic markets, particularly Stockholm, have the potential to attract investors with different profiles and strategies and, in contrast to markets like London and Paris, at competitive prices. Also of note is the continuing trend towards cross-border investments as investors aim at strong, long-term fundamentals now that borders are no longer seen as barriers to entry.”

Follow ACROSS on


fb-art 150


Strong Annual Growth in Germany

Around €3.8 billion were invested in the German retail market in the first three months of 2017.

MAS Heads for Bulgaria

The company reports that the continuous increase in purchasing power in the region underpins the investment case in general and that for its acquisitions of Galleria Burgas and Galleria Stara Zagora in particular.

Clearly weakened indicators of investment

BNP Parisbas Real Estate recently published “At a glance: UK shopping center & out of town retail market, December 2016.” One of the headlines is that investment volumes fell by around a third compared to 2015 for both the retail warehousing and shopping center markets.

Investors Increasingly Focusing on Retail Parks

Investment in German retail properties is declining. The transaction volume is increasing significantly only in retail parks. Retail parks currently offer good investment opportunities in the UK as well.

Retail Asset Management as a Holistic Approach

According to Stephan Austrup, Head of Retail in Germany at TH Real Estate, omni-channeling and digitalization are key drivers of change. In all acquisitions and in business plans for existing portfolios, he therefore considers the impact of this change on retail formats, retailers’ required floor plans, and whether the property provides the necessary layout flexibility.

“Emotions can of course arise toward a building”

TriGranit recently sold Bonarka City Center (BCC). CEO Árpád Török spoke with ACROSS, among other things, about a very eventful 2016.