Poland Good start for Polish retail

The Polish market continues to attract interest from new brands, borne out by several debuts. More arrivals are expected to follow amid improving retail sales, rising shopping centre footfall and turnover levels as inflation is weakening. 2024 got off to a good start with 82,000 sqm of GLA delivered in the three months to March. The Q1 of 2024 saw six new retail parks – these included Oto Park in Koszalin with an area of 38,000 sqm, the largest retail park completion since 2013. All the other retail parks were smaller than 8,000 sqm. In addition, approximately 12,000 sqm of new retail space was delivered through five extensions. New supply also included the redevelopment of Wysockiego Retail Park in Białystok and the refurbishment of Galeria Sieradzka.

Poland’s combined retail stock stands at approximately 16.3 mln sqm. The outlook for 2024 remains positive as the development pipeline suggests that new supply is likely to match or surpass 2023’s total. Shopping centres account for 18 pct of the stock underway, while retail parks with a 76 pct share in the pipeline continue to dominate the Polish development market.
Ewa Derlatka-Chilewicz, head of Research, Cushman & Wakefield

At the end of the Q1 of 2024 there was approximately 400,000 sqm of GLA under construction. Of that total, around 310,000 sqm will be delivered through new retail projects, with the remaining 90,000 sqm expected to come on stream through extensions and redevelopments. The largest projects under construction include the Nowa Sukcesja Shopping Centre in Łódź (35,000 sqm) and retail parks: Silwana in Gorzów Wielkopolski (26,000 sqm) and Big Ostróda (25,000 sqm).

In the Q1 of 2024, five brands debuted in Poland – these included Jack & Jones, House of Diamond, Kamalion, Made by Society, and Hesburger. During the first three months of the year, only one retailer withdrew from the Polish market: the Dutch brand Hunkemöller. According to data published by Statistics Poland, retail sales in constant prices improved significantly during the Q1 of 2024, growing by 3 pct in January and 6.1 pct in February.

Analysis of retail sales for February 2024 has revealed that only two out of the eight retail categories listed experienced falls year-on-year. Textiles, clothing and footwear – products that are particularly important to shopping centres - saw retail sales fall by 21.5 pct year-on-year, while figures for furniture, radio, tv and household appliances showed a slump in sales of 5.2 pct. By contrast, the strongest growth was recoded for motor vehicles, motorbikes and spare parts (+26.6 pct) and other (+23 pct). In February 2024, Poland’s online penetration rate stood at 8.6 pct and remained largely unchanged year-on-year. The best online performers were multimedia, fashion, furniture, radio, tv and household appliances.
Ewelina Staruch, market analyst, Cushman & Wakefield

Statistics show that shopping centres remain popular retail destinations attracting big spenders. The average footfall for shopping centres and retail parks in Q1 2024 was approximately 420,000 customers per retail scheme, a significant improvement over previous years. The footfall index was up by 17.1 pct year-on-year and by 5.5 pct when compared with 2022. The strongest month was March 2024 with approximately 455,000 visitors on average. Moreover, average financial inflows of shopping centre tenants for the first quarter of 2024 are relatively close to last year’s.

Net nominal turnover averaged PLN 972 per sqm in January 2024, a year-on-year increase of 4.3 pct, before falling slightly to PLN 849 per square metre in February. Importantly, with inflation slowing, real turnover was no longer in negative territory of several per cent. In addition, consumer sentiment remained resilient compared to previous months, boding well for the whole retail market.
Ewelina Staruch

All three retail formats – shopping centres, retail parks and high streets – posted average year-on-year rental growth.

Retail parks reported the strongest rise of 13.5 pct. Meanwhile, prime shopping centre and high street rents increased by approximately 11 pct year-on-year. The relatively strong rental growth at the beginning of 2024 was driven by annual rent indexation translating into higher rates in new leases.
Paulina Bauer, head of Retail Asset Services, Cushman & Wakefield