Retail Market Report | 2020

Outlook

groups such as storage concepts and childcare facilities have already ensured compensation for ground-floor vacancies in secondary and tertiary locations. In the future a growing number of alternative users will be encountered in better locations, particularly in the shopping centres. A growing amount of space will be leased particularly by healthcare professions, e.g. physicians, massage therapists and physiotherapists, but also service providers from the field of education, for example language schools.

The retail segment will certainly be the most challenging segment of the real estate market for the foreseeable future, and innovative and bold concepts will be necessary for the successful and sustainable operation of shopping centres and thorough revitalisation of shopping streets. Further revenue development in brick-and-mortar retail is extremely uncertain at present. After a year-on-year increase of 1.3 percent to EUR 73.2 billion was generated in 2019, this year the positive trend is not expected to continue. Forecasts are barely possible for the overall year, as it is entirely unclear which corona measures will leave their mark on the next few months, and even a light lockdown could have enormous consequences, for example in the Christmas business. The increasing share of online retail remains the greatest challenge for brick-and-mortar retail. Austria’s online retail industry generated EUR 3.5 billion in 2019, and revenue growth is also expected to be much stronger than in brick and mortar in the coming years.

Exploit the benefits of digitalisation

In the coming years, the creative and consistent use of new technical possibilities in the field of mobile communications will become an important factor of success for retailers and operators of shopping centres. The use of beacons, customised offers directly on the individual customer’s smartphone and digital shopping assistants are just several of the possibilities that will shape retail and make the difference between a good and a successful shopping centre. Just as important will be the continued adaptation of the tenant mix to changed consumer behaviour, in which gastronomy, service and recreational offers will be increasingly important.

New user groups gaining ground

Having drawn attention in recent years with an growing share of gastronomy space in top locations, the structural change in retail will continue in the years to come. In the last few years, new user