Shopping mall boom at an end
Recent years in the Czech Republic saw a major boom in new shopping centre development throughout the country. Now the boom is at an end. According to the daily Lidové noviny, 2011 will be the first year in two decades which will not see the opening of a single new large retail centre.
“I think that as the retail space per head of population catches up with Western levels, this decrease in development is part of a natural slowdown. That, coupled with the financial crisis which saw financing for new development –virtually all real estate, not just shopping centres – dry up, led to the massive reduction in new projects. I think developers to an extent are taking up new tactics.”
What will change?
If the market is just about fully saturated in the bigger cities like Prague, how are already existing malls doing?
“Certainly what we’ve seen in the last three years is the distinction between well-performing shopping centres and those that have done poorly. Going back seven or eight years when there was this rush in development and not enough space per consumer head virtually every shopping centre performed and traded well. As the market became more saturated we’ve seen a division between those that have continued to perform and those that are doing poorly and require re-direction and heavy asset management.