Arrangement over the Avenue

Warsaw journalists visited the same point at Jerozolimskie Avenue at least twice in March. The first time was to be present at a press conference on the second part of the Reduta shopping centre. Two weeks later they were invited to celebrate the opening of the Blue City shopping centre situated more or less opposite the Reduta. Both Foras (Reduta) and Reform Company (Blue City) went out of their way to stress that they do not perceive each other as competitors, but rather as collaborators.

H&M arguments

Hardly surprising that such declarations astonished not only journalists, since how could two large shopping centres opposite one another not compete for tenants of whom there are not all that many on the Polish market? And how could they not compete for customers who do not have very much to spend nowadays, after all? The reply of the two parties concerned is that the realities make such a situation quite possible, since the retail offers by Reduta and Blue City are mutually supplementary, with each having their own enthusiasts. It is too early to verify information concerning customers, but more can be said about the tenants. A representative of a major retailer admitted that he had to hide from Blue City agents who offered him a lot of things: low rents unmet with on the market, excellent conditions of leases and cost-free interior furbishing. "Just for my brand to appear in Blue City and bring along further traders as the result" he claimed. But he was just not tempted, as he told us, because he believes in the greater turnover probably given by a location on the exit from the city - which is that offered by Reduta. The negotiations with him commenced too late since he had already undertaken to rent space with the neighbouring centre, but first and foremost because H&M had entered the enlarged section of Reduta. Indeed, it seems the presence of that chain also convinced other important tenants, including Reserved, Cropp, Top Secret and Carry, to sign contracts with Foras.

Yoram Reshef and his talents

Blue City, too, had and has its strong points, one of the most important - highly attractive leasing conditions - being the person of its head who is Yoram Reshef, one of the principal authors of the success registered by the Mokotów Gallery in Warsaw. One of the tenants remarked clearly: he knows how to create a good centre. Yoram Reshef is well aware that his name attracted several companies. "I promised to be here at least during the first year of Blue City's operations. The first twelve months are always the most complex." The refurbishment and letting of Blue City was far from easy due, among other things, to the bad reputation of the previous owners of the project - the Bekdas family of Turkish origin - and the poor road communications between the building and Jerozolimskie Avenue (hence the construction of a tunnel under the Avenue, unfortunately only one-way traffic). To that list Yoram Reshef added the harmful gossip supposedly disseminated by agents occupying competitive objects: Jones Lang LaSalle (Reduta) and Cushman & Wakefield Healy and Baker (Złote Tarasy). Reshef commented that he is not a person who holds a grudge for long but that he is unable to overlook the behaviour of those firms.

Rents are not everything

The level of rents is not the only matter facing tenants - stresses Ib Bundgaard, Managing Director of Foras Management Poland. Other arguments also mean a lot, witnessed by the 50-percent pre-letting rate in Reduta's second stage. Reduta managed to attract the previously mentioned giants: LPP (Reserved, Cropp) and H&M, and is constructing the second phase of Reduta for them. The work is being concluded in short time - that is 7 months from commencing. But that is not everything. Foras of Denmark decided to upgrade the WKD commuter railway station at the rear of the shopping centre. The other brands which still are in Reduta (Cubus, Benneton), but have decided to cross to the other side of the street, will not be present when the second stage of the shopping centre opens nor when the railway station is refurbished.

Warsaw's shopping hot spot

It may come as some surprise to customers to find that there are more than a total of 400 shops in both Reduta and Blue City, a number unheard of in Warsaw. Moreover, the brands they hold exist only in one of them at a time. That sounds just fine, but the citizens of Warsaw will be tempted next year by attractions proposed in the city centre by Złote Tarasy (Golden Terraces). So would it not prove better to commence the already suggested cooperation on a grander scale and establish a stronger competition to that project? Both Ib Bungaard of Foras and Yoram Reshef of Reform Company have said they would be willing. Yoram Reshef of Blue City made no attempt to conceal that it is too late for many aspects of cooperation. He said: "TK Development, Reduta's previous owner, was not in the least interested in joint efforts to prepare greenery or roads, for instance. Foras is a much more open company which is why we have opened talks with it". Ib Bundgaard informed: "For the moment an idea to organise a common bus to transport customers to our centres has appeared. We are ready to study other proposals as well, since our and their interests are convergent in many points. But all ideas must be approved by both parties". When asked whether a possibility exists to set up a joint budget to advertise the new and exceptional shopping location in Warsaw, the replies were cautious on both sides. They refused to present any positive or negative rigid declarations.