Continued economic and population growth are fuelling rapid expansion across Turkey and the retail market is one of the most active in EMEA.
Turkey has been tipped by more than one analyst as a key market for 2012, particularly for its rapidly growing retail market which has been buoyed by the potential of its relative immaturity and its youthful demographic, the latter in stark contrast to ageing Europe.
Agent Jones Lang LaSalle notes that retail GLA rose by 880,000 sq m during the first three quarters of 2011, up over 300,000 sq m on the increase in retail space in 2010. Retail rents stabilised in 2011 at around $105 (€80) per sq m but JLL expects them to nudge up a further $6.50 over the course of this year, driven in part by higher demand and also by higher quality retail schemes coming onstream.
In the office sector Cushman & Wakefield reports that growth moderated in the third quarter as the government tried to dampen fears of overheating in the economy. However performance, on the whole was positive, says C&W, with occupiers continuing to move around the market and in sub-markets where Grade A space is lacking, which has pushed rents up while vacancy falls. Sentiment surrounding the investment market is more positive despite no deals closing in the third quarter, but with increased levels of interest from both domestic and international players.
Although much of the growth and market entry for overseas players across the commercial sectors has naturally been focused on mega-city Instanbul, increasingly regional Turkish cities and regions have been promoting their appeal on the international stage. In November, UK-based architect BDP revealed details for a major new project on the outskirts of Izmir, Turkey’s third largest city, carried out for Turkish developer Megapol. BDP has produced a masterplan and concept design for the Vaha Project which will create a new 175,000-sq m shopping and leisure destination for the region on a narrow site at the foot of a mountain range.
At Reed Midem’s retail event MAPIC in November the Ankara Chamber of Commerce (ACoC) took a large stand and brought senior local and national politicians to Cannes in a cohesive strategy to promote the city and to share its vision.
ACoC president Salih Bezi emphasises the potential of the Turkish market and stresses that: “Turkey is very dynamic, it is growing very fast, the population is very young and these factors are very important for the retail market. It is very important that we attract the right businesses to continue to develop in the right direction.”
There is also plenty of activity in Istanbul. Zorlu Group will open its scheme, creating a new town square for the city, later this year. The Zorlu Center has been designed to bring together residential, retail, a hotel, offices and a performing arts centre. The Zorlu Center Shopping Mall will be at the heart of the project amid landscaped grounds and will include 200 Turkish and international brands, up to 40 restaurants and a 2,700 sq m gourmet grocery market. A 10-screen cinema and 2,000 sq m fitness centre will also be located within the project.
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