It’s not doom and gloom across the board—emerging economies with a fast-growing middle class are the new go-to destinations for top international retailers.
In MORE Vision 4 we took a look at the top seven emerging retail trends in 2012. One of these trends was the increasing middle class in fast-growing countries and the strong demand for international retailers in these countries. For investors looking to expand, markets like Poland, Russia and Turkey are the new destinations of choice.
In Poland, one of Europe’s surprising financial success stories, nearly 40 new international brands began operations in the country in 2011. The country has remained a key target for international retailers, with brands including Toys R Us, GAP, Desigual and Foot Locker entering the Polish market in 2011. Jones Lang LaSalle has forecast a positive outlook for 2012 as well, reporting that the country’s total shopping centre stock currently under construction amounts to over 707,000 m2, out of which nearly 500,000 m2 is scheduled for completion this year.
In Russia, Prime Minister Vladimir Putin is one of many power players now courting the middle class, which is estimated to comprise 30% of the country’s population. Russia’s middle class doesn’t just wield political influence, however – this new generation of increasingly wealthy young people is seen as the driving force behind the country’s push for prosperity. Reuters recently reported that Russia is expected to become Europe’s top retail market by 2013/14, with retail sales rising 9.5% year-on-year in December, compared to 2.6% growth in the UK.
And finally, Turkey, where Bloomberg is reporting a new generation of young shoppers leading the charge in the country’s explosive growth, a trend that did not go unnoticed by our Property Influencer Mehmet Even. Private consumption fueled an 8.2% increase in gross domestic product in the third quarter, three times Germany’s growth rate.
The economy’s strength encouraged Multi Corp. BV, Inditex SA and Abercrombie & Fitch to invest in Turkey, where, according to Cushman & Wakefield, there is only 76 sq m of mall space for every 1,000 inhabitants, compared to 240 sq m in the European Union.
Watch this space for the next MORE Vision!
Every two months, MORE Vision by MAPIC will contribute to the retail real estate community’s knowledge base by exploring a key trend influencing retail property strategy today. Each issue of this multichannel and multi-tool service will include a presentation of a trend, with history, key figures and useful links. Questions raised will be opened up for debate on our social media platforms – the best comments and discussions will be summarised and published here on the MIPIMWorld blog.