Polish retail park market stable despite crisis

The retail park segment in Poland remains stable in the current crisis and offers significant growth potential, according to the latest market report by Trei Real Estate and JLL Poland.

The prime yields for high-end retail parks remain unchanged at 6.5% to 6.75%, while monthly rent rates for prime assets range from €8.00 to €12.00 per m2.

Investments in the Polish retail investment market reached €760 million by mid-2022, compared to €1.0 billion for the full year 2021.

During H1 2022, around 183,200 m2 of newly completed retail space was added, with retail parks accounting for 66%, stand-alone retail warehouses for 28%, and traditional shopping centres for 6%.

An estimated 181,000 m2 of space in retail parks will be added by the end of 2022.

Pepijn Morshuis, CEO of Trei Real Estate, commented: ‘Prime rents have so far been stable at the level of previous years. But given the increase in construction costs and interest rates, rents will inevitably go up in the future. Just like in other countries, the macroeconomic situation in Poland is defined by very high inflation rates and fast-rising interest levels. Against this background, the stability of the retail park segment is very reassuring.’

The density ratio for retail parks in Poland is only 84 m2 per 1,000 inhabitants, compared to 258 m2 for traditional shopping centres, implying significant growth potential.

Tenant-side demand remains strong, with 50 international retailers entering the Polish market over the past three years, while 18 left.

Shopping centres account for 61% of Poland’s retail property market, while retail parks currently account for around 14%.

One major advantage of the retail parks are their low monthly service charges, ranging between €1.50 and €2.00 per m2, compared to up to €20.00 per m2 charges in shopping centres.

However, this is set to change as growing energy prices will push service charges up.


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