is accompanied by a higher risk of rental default, as well as the reduction of average contract terms. The other side of the coin is that, in view of the limited prospects for success, only few owners are prepared to launch a sale pro- cess and are waiting for a market recovery. Retail properties normally tend to generate
part of retailers. Investors’ sentiment has also been negatively affected by the many recent bankruptcy reports, not only from the retail sector but generally, and above all, in the real estate branch. SIGNA is by far the largest, but unfortunately not the only bankruptcy.
a general oversupply of brick-and-mortar selling space, weaker locations are likely to drop out of the market over the medium to long term. At the same time, that means continuous investments in functioning locations to protect their positions over the long-term. The decisive factors will be the quality and financial strength of the tenants and convenience for customers that are necessary to support the generation of sustainable earnings to cover the normally indexed rents. When refurbishments lead to the creation of new products with top rents, the interest of investors will return because shopping centres and retail parks basically produce higher cash flow than other asset classes.
somewhat higher cash flows than, for example, residenti- al properties, which means most loans can be repaid and stress situations are less frequent than in other areas. As a result, the market holds few attractive investment opportunities that could motivate potential buyers to rethink their sceptical attitude.
Other negative factors for invest- ments include the generally difficult climate for the retail trade, which is accompanied by a higher risk of rental default, as well as the reduc- tion of average contract terms.
Moreover, there is reason to fear the second half of 2024 will see the market exit of further major players. One clear light on the horizon is the absence of turnover growth in online retail for the first time in 2023. However, the share of online sales for goods like fashion, books and electronics will never return to the pre-pandemic level, and book and mortar retail will therefore remain under pressure. Since there is almost certainly
It is interesting to note that the interest in acquisitions is currently not focused on core properties but on older, outdated or badly rented properties as well as shopping centres and retail parks in urgent need of refurbishment. The requirement is, of course, that the properties are located at well-frequented locations and, with the right positioning and good management, can generate the necessary interest on the
Reference projects: Investment
Adlerhof
FMZ Rosental
EHL Investment Consulting brokered the “Adlerhof“ at
The Rosental retail park owned by Nuveen Global in Styria with 10,120 sqm of space was brokered by EHL Investment Consulting to a private investor/ family office.
Siebensterngasse 46 in Vienna‘s 7th district with 161 residential and nine commercial units on 11,410 sqm of space to Thalhof Immobilien.
Total space Customer
11,410 sqm S IMMO AG
Total space Customer
10,120 sqm Nuveen Global
Austria | 2024/25
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