© Horst Dockal
© Goldenes Quartier_Gregor Titze
The Vienna Retail Market
The most prominent new additions include international fashion chains like TOD‘s and Karl Lagerfeld as well as the sporting goods retailer XXL Sports and the Dutch retailer HEMA which was accompanied by EHL. An interesting factor is the high share of gastronomy companies among the new additions, including the US pizza chain Domino’s, which was supported by EHL and plans to open up to 40 branches. A number of new market players are also expected in 2018, including Decathlon in Vösendorf and Apple with its first Austrian location on the Kärntner Straße in Vienna. However, the overall demand for space is declining. Food retailers are one exception: the branch networks are growing and existing locations are expanding, not least due to the integration of additional offers like cafés or collection points for online orders. Develop- ments in the shoe and fashion branch are moving in the opposite direction with current searches focused on shops with 50 sqm and 100 sqm, in contrast to the 400 sqm which were standard only a few years ago.
The development of the retail sector in Vienna is generally sound as a result of the steady population growth, favourable economic climate and strong tourism. Results for 2017 show a nominal increase of two per cent in revenues. However, the branch-based retail trade can only benefit from this situation to a limited extent because online sales rise steadily and Brick & Mortar retail accounts only for a very limited share of the overall growth. International comparisons, in particular, point to an optimistic outlook for the Vienna retail market, and Vienna remains one of the most popular expansion targets for global retailers. The city currently ranks among the top five in Europe, in the same league with Moscow, Paris, London and Berlin, and is once again under the top ten expansion targets worldwide. Tourism plays a strong role in this picture with growth of four per cent to 15.5 million overnight stays in 2017. The international chains are focused on top locations – and the definition of a top location becomes increasing- ly narrow - and only a few prime locations can benefit from this: most notably parts of the first district and a limited number of high-frequency shopping centres. The variety of retailers at these locations is higher than ever before, which further strengthens their attractive- ness. In contrast, vacancies are on the rise in shopping streets like the Wollzeile in the first district, which were considered very promising only a few years ago.
Prime rents in Vienna in EUR/sqm
stable
Out look
| 17 | 18*
11 | 12 | 13 | 14 | 15 | 16
* Forecast
Source: EHL Market Research | Q1 2018
10
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