ECONOMY

Europe nears milestone in shopping mall area

LONDON (Reuters) – Shopping center space in Europe is set to grow beyond 100 million square meters next year – a near-doubling of total capacity since 1997 – but still has plenty of room to expand, a property specialist said recently. «Some parts of Europe, notably in the east, still have little stock of modern retail space, while some of the stock in more mature Western Europe markets is not fit for purpose and in need of redevelopment,» said Yvonne Court, head of retail research at property services firm Cushman & Wakefield. In an earlier statement, Cushman & Wakefield said a record 7.5 million square meters of extra shopping mall was expected to open in Europe in 2007, after a 4.3-million-square-meter addition in the second half of 2006. That would take the total amount of shopping mall space in Europe to almost 107 million square meters by the end of next year, compared with 562 million square meters of shopping center space in the United States, according to a 2005 survey by CoStar/NRB. Russia and Poland were expected to account for more than a 10th each of the expected new floor space in Europe in 2006-07, excluding extensions, followed by Italy, Spain, and Germany, Cushman said. Cushman’s data showed Britain was the region’s biggest shopping mall market with a total 14.1 million square meters of space, followed by Western Europe’s other big economies – France, Germany, Italy, and Spain. Germany, Italy lag But the results told a markedly different story on a per capita basis, with the relatively regulated markets of Germany and Italy falling short of the European Union average. At 152 and 141 square meters, Europe’s biggest and fourth-biggest economies have a gross leasable shopping center area (GLA) per 1,000 of the population below that of Latvia and Estonia – or around half that of Austria and the Netherlands. Germany for example only had one out-of-town shopping center, Centro at Oberhausen, near Dusseldorf, Court said. Greece and Belgium – two other members of the eurozone – have even less GLA/1,000 people, at 37 square meters and 92 square meters respectively, Cushman data showed. As planning regulations eased, more and more West European countries were seen replacing obsolete city-center retail property with bigger, more integrated developments that might encourage greater consumer spending and counter the challenge of online retailing, Court said.