Retail Market in Poland - Q4 2023
2023 dominated by retail parks and convenience centres
The retail market in Poland continues to grow with over 560,000 m² added to the stock in 2023, a +14% increase compared to the previous year and +8% with regard to the five-year average.
Macro trends have remained untouched with new supply strongly dominated by retail parks. This format now claims almost 2.9 million m² of existing stock, accounting for some 17% of total retail space in Poland. The shopping centre format was boosted by almost 90,000 m², however majority of this space was attributable to re-openings and extensions of already existing projects, including E.Leclerc Jelenia Góra, Fort Wola and Atrium Promenada in Warsaw.
High financing costs and uncertain sentiment influenced investors’ appetites and market dynamics in 2023. In the first half of the year, bidder activity was exceptionally low, resulting in a decrease in the investment volumes to a record-low levels.
Retail parks, convenience centres and standalone grocery stores remain of unwavering interest to both private investors and institutional capital. We observed an increase in investor activity in the last quarter of the year, particularly in the retail park segment, and we expect that submitted offers will translate into transactions in the first half of 2024.
The anticipated compression in interest rates in 2024 should reduce the polarization of price expectations between buyers and sellers and gradually increase the investment volume.