Retail Market Report Austria | 2022/23

The Retail Market in Austria

A difficult environment and lots of ques- tions

unclear situation surrounding the Ukraine conflict and energy supplies in Austria and Europe have made reli- able planning nearly impossible. Only a limited number of new rentals have been concluded since the spring, and advanced negotiations are frequently on hold. The tensions caused by the economic effects of the war are overshadowing several positive long-term trends: The general cancellation of corona-related restrictions and an optimistic economic outlook up to January led to expectations of a noticeable upturn. The large number of original retail concepts also provided grounds for optimism that brick-and-mortar retail could transform the challenges created by online competition into innovation and new momentum. A further bonus is the return of city tourism and the related increase in turnover.

The retail property market is currently in a challenging phase. Traditional retailing is under pressure from the sharp rise in wholesale prices, a weakening economy and decline in purchasing power, rising personnel costs and strong online competition – all of which have led to caution in location decisions. According to the Austrian Retail Trade Association, retail turnover fell by eight per cent year-on-year in the second quarter of 2022 and the decline in non-food was even stronger. Gastronomy has also felt the effects of the crisis, but to a lesser extent. The result has been a substantial, short-term drop in the demand for space.

These negative factors have been accompanied by greater uncertainty over future developments. The

In other words, there are bright spots in the midst of this generally gloomy situation: The winners include

Development of retail space in Austria

2.0 % 1.5 % 1.0 % 0.5 % 0.0 % -0.5 % -1.0 % -1.5 % -2.0 % -2.5 %

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022p 2023p 2024p

Source: RegioData Research GmbH Wien 2022