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Overview of the retail property market of Kiev| Results I 2015
Indicators of the retail property market in
Kyiv
Results of 2015
Overview of the retail property market of Kiev| Results I 2015
Indicators of the retail property market of Kyiv .……………...……..8
Socio-Economic Development of Ukraine……………….……3
Market Offer………………………………..……….9
Vacancy Rate / Store traffic in SC …..…...…..…14
Dynamics of Rental Rates …………………………..………15
Demand Analysis ………………..…………..…….…………..16
Trends and Forecasts ………………………..……….………18
2
Overview of the retail property market of Kiev| Results I 2015
Socio-Economic Development of
Ukraine
3
Overview of the retail property market of Kiev| Results I 2015
Socio-Economic Development of Ukraine
4
Real GDP (Quarter III of 2015.)*-7.2%
Inflation (end of year) * +43.3%
Exchange rate (UAH/USD)** +34.3%
Retail trade turnover -21.4%
Export * -30.8%
Import * -32.3%
Industry * -14.4%
Agricultural Sector -4.7%
Public Debt** +27.66%
Construction * -9.5%
Commissioned Housing* -3.1%
Average Salary ** -21.8%
Direct Investments -3.9%
* in relation to indicators of the similar period of 2014
** in relation to indicators of December 2014
Overview of the retail property market of Kiev| Results I 2015
Real GDP (I Q 2015) - 7,2% Inflation + 42.3% Retail trade turnover - 21.4%
The dynamics of GDP, billion UAHGross Domestic Product
Nominal GDP of Ukraine for the III quarter of the year 2015
amounted to 1,372.2 billion UAH., that is 248,559 billion UAH or
18.11% higher than an index for the similar period of previous
year (1,123.6 billion UAH). Real GDP displays a 24% drop that in
money equivalent makes up 1,031.9 billion UAH.
Consumer Price Index
The inflation index in Ukraine by the end of 2015 made up
143.3% that first of all is caused by devaluation of hryvnia
and, respectively, increase in prices mainly for imported
production.
Commodity Turnover
Turnover for 11 months of 2015 amounted to 918.4 billion
UAH., that is 11.7 billion UAH or 18.11% higher than an index
for the similar period of the previous year. Such a positive
dynamics was achieved through the depreciation of the national
currency and the growth of prices for food products. By
comparing the turnover of January and November 2015 in
comparable prices of 2014, it makes 78.6 per cent of the January-
November 2014 scope, i.e. less by 21.4%.
The peak months of growth of retail commodity turnover
in Ukraine following the results of the period January-
November, 2015 were: February-March, July, October.
The greatest decrease in retail commodity turnover in comparison
with the similar period January-November, 2014 is recorded in
Luhansk (by 76.5%) and Donetsk (by 67%).
The leaders of the absolute volume of retail trade turnover
are Kyiv region (47.2 Billion UAH, Kyiv – 141.2 Billion
UAH), Dnipropetrovsk region (85.4 Billion UAH), Kharkiv region
(75.6 Billion UAH) and Odesa region (65.5 Billion UAH).
Socio-Economic Development of
Ukraine
5
544
720
948 913
1,079
1,300
1,404 1,4491,566
1 3727%
8%
2%
-15%
4% 6%
0% 0%
-13%
-24%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
0
200
400
600
800
1000
1200
1400
1600
1800
2006 2007 2008 2009 2010 2011 2012 2013 2014 Q3. 2015
Nominal GDP, billion UAH. Real GDP, %
1,042
1,3511,806
1,906
2,239
2,6333,026
3,619
4,012 4096
12%17%
22%
12%9%
5% 0%
1%
25%
43%
25%29%
19%
-17%
8%
15%
16%
-2%
-15%
-21%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
4 500
2006 2007 2008 2009 2010 2011 2012 2013 2014 Q3. 2015
Average salary Consumer price index
Dynamics of retail commodity turnover
Consumers market
Overview of the retail property market of Kiev| Results I 2015
Export -30.8% Import -32.3% Commissioned Housing* -3.1%
Foreign economic activity
The current negative situation in the country
continues to adjust requirements to the external economic
activities of the country.
As of November, a decrease of exports of goods
compared to the same period of 2014, is by 30.8%, of
imports - by 32.3%. Due to the significant reduction of
imports a positive balance of $ 380,960 million dollars is
recorded.
The dominant share in the structure of the Foreign
Economic Activities belong to the following partner
countries: the Russian Federation is leading (export-
19.1%, import-24, 6%), China(4.6%, 9.8%), Turkey
(6.4%, >2%), Poland (5%, 5.7%), Italy
(4.6%, 2.8%), Germany (3%, 9.6%).
Foreign economic activity of Ukraine
Socio-Economic Development of
Ukraine
6
Construction
For the period from January to November 2015
enterprises in Ukraine completed construction works in the
amount of 46,990 billion UAH, that is 9.5% below the rates
of construction for the entire 2014 (in money equivalent
51,108 Billion UAH), and by 4.7% more than for the same
period of 2014. (in money equivalent 46,990 Billion UAH).
New construction, reconstruction and technical re-
equipment amounted to 80.7% of the total amount of
construction works, capital and current repairs-10.9% and
8.4% respectively.
253,707
323,205
444,859
423,564
549,365
707,953
717,347
681,899
770,121
31341659,8
269,200
364,373
520,588
438,860
580,944
779,028 835,394805,662
834,133
30960699,8
0
10 000 000
20 000 000
30 000 000
40 000 000
50 000 000
60 000 000
70 000 000
80 000 000
90 000 000
2006 2007 2008 2009 2010 2011 2012 2013 2014 Q3. 2015 Export Import
8 628
10 244 10 496
6 400
9 339 9 410
10 75011 217
9 741
1 620
10,40%
18,70%
2,50%
-39,80%
45,00%
0,80%
4,40%
-2,10%
-19,30%
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
0
2000
4000
6000
8000
10000
12000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Ukraine, thousand sq.m. Growth rate, %
Volume of housing put in operation in Ukraine in dynamics
Overview of the retail property market of Kiev| Results I 2015
63
7873 72
8289
82
73
8479
0
10
20
30
40
50
60
70
80
90
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Investments
Active military operations against economic recession
suspended business activity in the country, first of all curtailment
of plans of foreign investors is observed.
Following the results of 3 quarters of year 2015 the volume of
investments decreased by 4%, in nominal equivalent amounted
43,949 million USD. (overall total from beginning of investment).
Dynamics of direct foreign investments in Ukraine
WEF world ranking
In the world competitiveness index GCI (WEF) according to
WEF Ukraine ranked 79th in the ratings, losing 0.11 points
(from 4.14 to 4.03), compared to 2014. Key factors
of the deterioration of the situation are macroeconomic
indicators, the situation in the financial market.
Besides, the situation in the eastern part of Ukraine has been
tense and it continues to adversely affect the overall situation
in the country.
Categories 2016
Doing Business 83
Registration Of Enterprises 30
Obtaining of the permission for construction. 140
Power connection 137
Registration of property 61
Receiving of Loans 19
Protection of minority investors 88
Taxation 107
International Trade 109
Ensuring performance of contracts 98
Insolvency admission 141
Index of competitiveness of Ukraine in the WEF world ranking
Economy of Ukraine in the rating Doing Business
Socio-Economic Development of
Ukraine
7
$29,489$35,723
$40,026$44,708
$49,362$54,462
$58,156$45 916
$43,949
39%
21%
12% 12% 10% 10%4%
-23%
4%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
0$
10 000$
20 000$
30 000$
40 000$
50 000$
60 000$
70 000$
2007 2008 2009 2010 2011 2012 2013 2014 Q3. 2015
Direct foreign investments in Ukraine (cumulative since the beginning of the investment, mln. USD)
Overview of the retail property market of Kiev| Results I 2015
Industry
In November 2015 compared to the previous month and November
2014, the industrial production index stood at 98.3% respectively and
95.1% in January-November 2015 -85.6%.
In mining and quarrying, compared with January-November 2014 the
index of industrial production was 84.3%, processing-85.6%, supply and
distribution of electricity, gas and air-conditioning-87.8%.
The dynamics of the industry index ,%
Public Debt
The total amount of public and publicly guaranteed debt of Ukraine in
September 2015 amounted to 70,695 billion dollars equivalent to 1,521
trillion UAH.
In the structure of the public and publicly guaranteed debt domestic
debt makes up 34.2 per cent of the total debt or 520,758 million
UAH, external - 65.8% or 1,000,916.1 million UAH.
Exchange Rates Dynamics
5,05 5,05
7,98
15,77
24,00
6,657,41
10,44
19,23
26,22
0,00
5,00
10,00
15,00
20,00
25,00
30,00
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Dec.
dollar euro
Ratio of external and internal debt, mil. UAH.
Socio-Economic Development of
Ukraine
8
85,60%
0,0%
20,0%
40,0%
60,0%
80,0%
100,0%
120,0%
2009 2010 2011 2012 2013 2014 2015
211 752276 746 299 414 309 000
300 025
520 759
105 133155 490 173 708
206 511284 089
1 000 619
0
200000
400000
600000
800000
1000000
1200000
2010 2011 2012 2013 2014 Q3. 2015
Internal Debt External Debt
Overview of the retail property market of Kiev| Results I 2015
Indicators of the Kyiv retail property market of
2015
9
Overview of the retail property market of Kiev| Results I 2015
Key indicators of the Kyiv retail property
market
10
Market Indicators 2013 2014 2015 Change
General Quotation, sq. m 1,000,000 1,073,939 1,104,639 +3%
New Quotation, sq. m 164,420 87,220 30,700 -62%
Minimum rent rate, $ /sq.
m/mon.(Fashion Gallery 100-200 sq. m)30 25 18 - 28%
Maximum rent rate, $ /sq.
m/mon.(Fashion Gallery 100-200 sq. m)100 80 29 -56%
Average rent rate, $ /sq.
m/mon.(Fashion Gallery 100-200 sq. m)70 49.7 27
-46%*pegged dollar exchange
Vacancy, % 1.7 7.5 6 -1.5%
Store traffic, People/1,000 sq. m 828 795 699 - 12.1%
Store traffic of Regional SC, People/1,000 sq. m
530 654 650 -1%
Store traffic of Community SC, People/1,000 sq. m
1127 937 747 -20%
Overview of the retail property market of Kiev| Results I 2015
Within a year in the capital 3 objects were put into operation: Shopping Center DOMA center (GLA - 7 000 m2) and Shopping Center Novus on
Zdolbunovskaya, 7Г (8,200 m2 hypermarket and 5,500 m2 of trading premises), SC Poznyakoff (2,400 m2), the second stage of SC “Gorodok”
(hypermarket Fozzi of 10,000 m2) was put into operation. Thus, the total market proposal for 2015 amounted 1,107,039 m2 professional retail space, with
an increase by 3%. Commissioning of the «New Way» Community Centre (GLA – 16,200 м2), located at the intersection of Verbitsky str./Trostyanetskaya
St. and the SC on 6, Murmanskaya St., (GLA – 7,000 m2) is postponed to the next year. For 2016 the following projects are declared to opening as well:
SEC Retroville, Podol Mall, Respublika, Lavina Mall, Blockbuster Mall, CDS, Shopping center on the Pochtova square., Smart Plaza with the total rented
area of 429,700 m2.
General Quotation, sq. m 1,107,039 New Quotation 2015, sq. m 33,100 Perspective offer 2016, sq. m 520,954
Dynamics of the market offer, thousand sq.m
Shopping centres commissioned in 2014
SC Address GLA, Sq m Developer Open
Prospect Krasnogvardeyskaya/Krasnotkatska
ya str.41,000 Arricano Group Q3
Atmosphere Stolichnoye Highway, 103 30,000 De VisionQ3
Doma Cenrter 40,Stroiteley str. 7,000 KDD Engineering Q4
April Ring motorway/ 19, Les‟ Kurbas
ave.5,800 Local developer Q2
Appetite 1 Nokolay Bazhan ave. 3,420 Ukrainian Investment Alliance Q3
Total 87,220 m2
Epicenter 20d,Polyarnaya str. 70,000 Q4
Shopping centres commissioned in 2015
Doma Center 40,Stroiteley str. 7000Local developer
Q1
Novus 7g, Zdolunovskaya str. 13700 Novus Q2
SC “Gorodok”
(2 stage)Moskovsky ave.
10,000 KEMP “Svarka” Q4
Total 33,100 m2
SC Poznyakoff Bazhan ave. 2400 Local developer Q4
Shopping centres declared to open in 2016
Respublika* Ring Motorway, 1A 135,000 K.A.N. Development Being specified
Blockbuster Mall* 36 Moskovsky ave. 100,000 Megaline Q4
Lavina Mall Academica Palladina ave. 127,500 Megaline Q3
CDS 38, Khreshchatyk 20,000 Esta Holding Q3
SC on Pochtova
PloshadPochtova square 9,000 Local developer Q2
New Way Verbickogo str. 16,200 Local developer Q1
Lesnoy 6, Murmanskaya str. 7,000 Local developer Q4
Smart Plaza 26, Pobedi ave. 15,000 Local developer Q3
Total 429,700 m2
11
Offer on the
Kyiv retail property market
* Possible deferral of commissioning for 2017.
-400%
-200%
0%
200%
400%
600%
800%
1000%
1200%
1400%
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
2 000
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016F
2017F
Total supply as of the beginning of the year, GLA, thous. sq. m
New supply, GLA, thous. sq. m
New supply share, %
Growth, %
Overview of the retail property market of Kiev| Results I 2015
Perspective offers of floor spaces of 2017-2018.
SEC Address GLA Developer Open
Ocean Mall Gorki str. 45,000 Megaline 2017
SC at Geroev Dnepra Metro station Geroev Dnepra 7,800 Local developer 2017
"Lukyanovka" 7-7a, Degtyarevskaya str. 47,052 Arricano Group 2017
Retroville Pravdi ave. 91,254 Stolitsa Group 2017
Happy Mall Onufry Trutenko str. 42,000 Liko-Holding Suspended
HARTZ Zlatoustovskaya str. 68,000 Budhouse Group Suspended
Manhattan Mall 1, Inzhenernaya str. 69,200 Forum Evolution project
"Vyrlitsa" Nikolay Bazhan ave. 140,000 XXI century Suspended
River mall 10, 14 Dneprovskaya emb. 55,000 Local developer Suspended
Victoria 2, Nicolaya Vasilenka str. 54,300 Victoria Suspended
Kyiv mall Petr Grigorenko ave. 75,400 Dylays Suspended
Podol Mall 23, Elenovskaya str. 13,825 Building Invest Group Suspended
Auchan Zdolbunovskaya str. 55,000 Immochan Ukraine project
Gorky Park 52-54, Gorki str, 64,500Silver Sky
Development project
"Town" (3rd stage) 23a, Moskosky ave. 19,650 KEMP “Svarka” project
Petrovka Mall 10 Moskovsky ave. 65,360 Tiko Construction project
Nivki City Pobedi ave. 74,036 Local developer project
Univer City Vladimirskaya str. 18,700 Kyivgorstroy Invest project
Kyiv E95 Outlet (1 stage) Odessa highway 18,525Evo Land
Development project
Avenue 48, Cosmonaut Komarov str. 39,000Dragon & Tiko
Construction project
According to classification of ICSC, without taking into account the trade objects of up to 5 thousand sq. m and separate super - and
hypermarkets, the total area of professional shopping centers of the capital is 1,107,039 sq. m, that corresponds to the index of 382.7 Sq
m per 1,000 inhabitants as for the level of shopping capacity.
The retail property market of Kyiv stated about 20 SEC projects with the total leased area of some 1,063,602 m2 at different stages of
readiness (the design phase, start of construction, suspended construction) with possible opening in 2017 or 2018. The declared large-
format professional shopping and recreation centers are the main objects of perspective development for the Ukrainian and foreign
distribution networks. Their putting into operation will lead to high-quality growth of the market and (on condition of improvement of welfare
of the population) will promote further expansion of the international retailers.
Shopping capacities,
people/1000 sq. m
12
Offer on the
Kyiv retail property market
72
89
123
182
204
204
230
256
282
279
307
315
373
383
393
497
0 100 200 300 400 500 600
Zaporozhe
Chernigov
Kirovohrad
Lvov
Ivano-Frankovsk
Donetsk
Kherson
Simferopol
Vinnitsa
Nikolaev
Lutsk
Khmelnitskiy
Dnepropetrovsk
Kiev
Odessa
Chennovtsy
Overview of the retail property market of Kiev| Results I 2015
Operating shopping centers of Kyiv
Regional SC AddressStart-up
yearGLA, Sq m
Dream Town Obolonsky ave. 2009 81,000
Ocean Plaza 176 Gorky str. 2012 70,000
Sky Mall 2, General Vatutin ave. 2007 67,000
"Caravan" 12,Lugovaya str. 2008 44,000
Regional SC AddressStart-up
yearGLA, Sq m
“Bolshevik” 66, Vadim Getman 2008 37,000
Gulliver 1a Sportivnaya Ploshad 2013 45,200
ProspectKrasnogvardeyskaya/Krasnotkatskay
a str.2014 41,400
«Marmalade» 154 Borshagovskaya str. 2013 40,000
Art Mall 37 Akademika Sabolotnogo str. 2013 37,000
Promenada Center 17-21 Baggoutovskaya str 2003 34,000
Promenada Park 4 Bolshaya Okruzhnaya str. 2009 32,000
"Town" (1,2 stages) 23a, Moskosky ave. 2003/2015 17,000
Department Store
“Ukraina”3, Pobedi ave. 2003 23,000
Rayon 4, Nicolaya Lavruhina str. 2012 23,000
Arcadia 10a Dneprovskaya emb. 2008 22,000
“Magellan” 13b Akademica Glushkova str. 2003 21,600
“Quadrate” 36, Perova blvrd. 2008 19,000
"Globe" 1, Independence Square 2002 18,579
«Alta Center» 15 Moskovsky ave. 2004 17,000
Arcadia 154 Borshagovskaya str. 2007 17,000
«Metropolis» 12 Malinovskogo str. 2005 15,284
Silver Breeze Dneprovskaya emb. 2013 14,600
"Metrograd" Velyka Vasylkivska str. 2002 11,000
“Pyramida” 4 Mishugi str. 2004 12,000
“Plasma” 20 b, Moskovsky ave. 2006 12,000
"Alladin" 3-5, Grishko str. 2004 10,030
“Atmosphere” 103, Stolichnoye highway 2014 30,000
Arena City Krasnoarmeyskaya/Basseynaya str. 2005 8,000
KOMOD 4, Lunacharskogo str. 2007 7,647
DOMA center 4, Stroiteley str. 2014/2015 7000
Community Centre AddressStart-up
yearGLA, Sq m
VMB 136, Pobedi ave. 2004 5,000
“Quadrate” 20, Gnata Yuri str. 2003 11,502
«Polarny» 2, Mayorov str. 2013 8,630
“Olympic “ 72, Velyka Vasylkivska str. 2004 8,250
"Evroport" 15A, Lukashevitch str. 2005 4,195
"Interval Plaza» 143/2, Velyka Vasylkivska str. 2004 7,874
Community Centre AddressStart-up
yearGLA, Sq m
“Quadrat” 2, Belorusskaya str. 2002 6,000
InSilver 3, Sribnokilskaya str. 2011 5,909
"Darnitsa" 2/1, Vossoedineniya str. 2008 5,830
Specialized Centres AddressStart-up
yearGLA, Sq m
"Children's World" 3, Andrey Malishka str. 1987 8,000
Blockbuster 34 V, Moskovsky ave. 2008 24,750
4ROOM 6,Petropavlovskays str. 2009 24,000
"Araks" 110, Bolshaya Okruzhnaya str. 2009 16,000
“Ultramarine” 1A, Uritski str. 2004 15,000
“Manufacture” 2,Novoobuhovskoye highway 2013 15,000
“Diamant" 14 E,Petropavlovskays str. 2013 11,250
“Macros" 166, Moskovsky ave. 2004 8,286
"House of furniture" 23, Druzhbi Narodov boulvard. 1984 16,000
«B-52» 52, Bratislavskaya str. 2008 12,003
“Domosphere” 101, Stolichnoye highway 2009 24,500
“Mandarin Plaza” 4, Basseynaya str. 2003 9,400
Big boxes AddressStart-up
yearGLA, Sq m
"Epicenter" 20d,Polyarnaya str. 2014 70,000
"Epicenter" 4,Viskoznaya str. 2008 11,000
"Epicenter" 6, Hrustalnaya str. 2008 12,000
«New Line» 65/1, Balzak str. 2004 6,795
«New Line» 8,Odessa highway 2005 13,131
Metro 26 V, Moskovsky ave. 2005 9 500
Metro 2a, Saburov str. 2009 9 500
Metro 43, Petr Grigorenko ave. 2004 9 500
Metro 1v, Bolshaya Okruzhnaya str. 2003 9 500
"Auchan" 15a, Moskovsky ave. 2008 15,000
"Auchan" 6, Berkovetskaya str. 2009 15,660
"Epicenter" 11, Bratislavskaya str. 2008 12,000
"Epicenter" 1b, Bolshaya Okruzhnaya str. 2005 30,000
NOVUS 7a, Academica Palladina str. 2010 4,008
Leroy Merlin 17a ,Polyarnaya str. 2010 13,000
Leroy Merlin 3V, Brovarskoy ave. 2013 ~10 000
Leroy Merlin 26, Saperno-Slobodskaya str. 2014 ~10 000
"Epicenter" 40, Petr Grigorenko ave. 2005 43,000
NOVUS 4d, Krasnozvezdny ave. 2013 8,800
NOVUS 1a, Krasnogvardeyskaya 2013 6,000
NOVUS 8, Nikolay Bazhan ave. 2013 6,500
NOVUS 7g, Zdolunovskaya str. 2015 13,700
"Epicenter" 6v, Berkovetskaya str. 2009 56,000
13
Offer on the
Kyiv retail property market
Overview of the retail property market of Kiev| Results I 2015
Regional SC
Community Centre
Community Centre
Big boxes
Specialized Centre
Regional SC:
1) Dream Town Obolonsky ave.
2) Ocean Plaza - 176 Gorky str.
3) Sky Mall 2, General Vatutin ave.
4) «Caravan» - Lugovaya St., 12
District shopping centers:
5) "Bolshevik” - 66, Vadim Getman str.
6) Gulliver – 1a Sportivnaya Ploshad
7) «Marmalade» - 154 Borshagovskaya str
8) Art Mall - 37 Akademika Sabolotnogo str.
9) Promenada Center - 17-21 Baggoutovskaya str
10) Promenada Park - 4 Bolshaya Okruzhnaya str
11) «Town" (1,2 stages) - 23a, Moskosky ave.
12) Department Store “Ukraina" - 3, Pobedi ave.
13) Rayon - 4, Nicolaya Lavruhina str
14) Arcadia - Dneprovskaya naberezhnaya, 10a
15) «Magellan» - 13b Akademica Glushkova str
16) «Quadrate» - . 36, Perova blvrd.
17) «Globe» - 1, Independence square
18) «Alta Center» - 15 Moskovsky ave.
19)Arcadia - 154 Borshagovskaya str
20) «Metropolis» - 12 Malinovskogo str
21) Silver Breeze - Dneprovskaya emb.
22) «Metrograd» - Velyka Vasylkivska str
23) «Pyramida» - 4 Mishugi str
24) «Plasma» - 20 b, Moskovsky ave.
25) «Alladin» - 3-5, Grishko str
26) «Atmosphere» - 103, Stolichnoye highway
27) Arena City - Krasnoarmeyskaya/Bascejna
28) KOMOD - 4, Lunacharskogo str
Commodity centers:
29) VMB - 136, Pobedi ave.
30) «Quadrat» - 20, Gnata Yuri str
31) «Polarny» - 2, Mayorov str
32) “Olympic “ - 72,Velyka Vasylkivska str
33) «Evroport» - 15A, Lukashevitch str
34) "Interval Plaza» 143/2 Velyka Vasylkivska str
35) «Quadrate» - 2, Belorusskaya str
36) InSilver - 3, Sribnokilskaya str
37) «Darnitsa» - 2/1, Vossoedineniya str.
Specialized Centres :
38) "Children's World” -3, Andrey Malishka str.
39) Blockbuster - 34 V, Moskovsky ave.
40) 4ROOM - 6,Petropavlovskays str
41) «Araks» - 110, Bolshaya Okruzhnaya str
42) «Ultramarine» - 1A, Uritski str
43) «Manufacture» - 2 Novoobukhovskoye Highway
44) “Diamant" - 14e, Petropavlovskaya str.
45) «Macros» - 166, Moskovsky ave.
46) «House of furniture» - . 23, Druzhbi Narodov
boulvard.
47) «B-52» - 52, Bratislavskaya str
48) «Domosphere» - 101, Stolichnoye highway
49) «Mandarin Plaza» - 4, Basseynaya str
14
Map of existing and prospective shopping
centers of Kyiv
Overview of the retail property market of Kiev| Results I 2015
Shopping centres in Kyiv, declared to open in 2016-
2018.
SEC Respublika**
Kyiv, Ring Motorway, 1A
GLA – 135,000 m2
SEC Lavina mall**
Kyiv Academica Palladina ave.
GLA – 127,500 m2
SEC Ocean Mall
Kyiv, Gorky str.
GLA – 75,000 m2
SEC Blockbuster Mall**
Kyiv, Moskovsky ave.
GLA – 100,000 m2
SEC Smart Plaza**
Kyiv 26, Pobedi ave.
GLA – 15,000 m2
SEC Vyrlitsa
Kyiv Nikolay Bazhan ave.
GLA – 140,000 m2
SC on Pochtova*
Kyiv, Pochtova square
GLA – 9 000 m2
SEC Lukyanovka
Kyiv, 7-7a, Degtyarevskaya str.
GLA – 47,052 m2
SEC CDS
Kyiv, 38, Khreshchatyk
GLA – 20,000 m2
SEC HARTZ
Kyiv, Zlatoustovskaya str
GLA – 68,000 m2
SEC New Way**
Kyiv, Verbickogo str.
GLA – 16,200 m2
SEC Retroville
Kyiv, Pravdi ave.
GLA – 91,254 m2
* UTG - consultant
** UTG - consultant and an exclusive leasing agent
15
Overview of the retail property market of Kiev| Results I 2015
Average daily store traffic SC traffic
(people per 1,000 sq.m, GLA)
16
Store traffic
Daily average store traffic of the Kyiv shopping centers by results
of 2015 made up: for regional SEC 650 people per 1,000
sq.m, GLA, for Community Centres – 747 people per 1,000
sq.m, GLA. Average value - 724 people per 1,000 sq.m, GLA.
It should be noted that following the results of 2015. there was a
decrease in the average level of store traffic by 12%, at that store
traffic of Community Centres decreased by 20%, and of regional
SC by 1%, that shows the stability and a demand for these
formats. The highest store traffic is in the best Kyiv shopping
centers at the level of 30-40 thousand people on weekdays and
to 60 thousand people during the week-end.
Addressability
By the end of 2015, the vacancy rate decreased by 1.5% to 6%. It
is connected with the beginning of stabilization of the trade
segment and with the results of building relations between tenants
and owners of shopping centers. Besides, in 2015 there was a
record-breaking low volume of floor spaces (30,700 sq.m), despite
the considerable volume of the trade offer which was declared, but
postponed for 2016. The relative stabilization of the national
currency and receiving more favorable lease terms by tenants
contributed to the decrease in the vacancy as well. For some
retailers, this crisis was a period of active development.
Average Addressability in Kyiv SC, %
Store traffic и addressability in
shopping centers of Kyiv
Community SCRegional SC
0100200300400500600700800900
1000
Octo
ber
201
4
Novem
ber
201
4
Decem
ber
201
4
January
2015
Febru
ary
201
5
Marc
h 2
015
April 2
015
May
2015
June 2
01
5
July
201
5
August 2
015
Se
pte
mbe
r 2
015
Octo
ber
2015
Novem
ber
201
5
Decem
ber
201
5
0,0%
1,0%
2,0%
3,0%
4,0%
5,0%
6,0%
7,0%
8,0%
Novem
ber
2014
Decem
ber
2014
January
201
5
Febru
ary
2015
Marc
h 2
01
5
April 2
01
5
May
201
5
June 2
015
July
2015
August 2
01
5
Septe
mber
2015
Octo
ber
201
5
Novem
ber
2015
Decem
ber
2015
Overview of the retail property market of Kiev| Results I 2015
Rental rates
shopping centers of Kyiv
Standard terms and conditions of rental in shopping centers of Kyiv
Lease
Term.From 3 to 10 years, for anchors 5-15 years
Payment
Terms
Rates are denominated in USD, payments are in UAH
according to the agreed exchange rate, annual indexation
is at the level of the CPI. The rate of $1 is fixed at the level
of UAH 22
Deposit From 1 to 3 months, for anchors warranty is possible
State of
premises Shell and Core condition
17
Rental rates
Beginning of the year 2015 was characterized by technical
reduction of rental rates, in connection with a serious leap in
currency rate. Starting with 2nd quarter, the rates stabilized at
$ 28.5 level. At the end of the year, the average rent in the
shopping centers of Kyiv for the Fashion Gallery (for the premises
of 100-200 m2) made up $27.3 / m2/ month without VAT, that by
24% less than the average rental rate for 2014. Moreover, lessors
use practice of "the individual arrangement": short-term fixing of
dollar exchange rate, repair compensation, etc.
The scheme of payment with percent from commodity
turnover is widely spread– 2-5% for anchor tenants and 7-15%
for operators of the shopping gallery.
Dynamics of rental rates in shopping center of Kyiv, USD, UAH.
Average range of rental rates in shopping centers of Kyiv
($/sq m/m without VAT and OPEX)
Rental rates in
shopping centers of Kyiv
38,5
29,3
18,221,6
28,6 28,6 28,6 28,6 28,6 28,6 29,0 29,0 29,0
0
100
200
300
400
500
600
700
0
5
10
15
20
25
30
35
40
45
Decem
be
r 20
14
January
2015
Feb
rua
ry 2
015
Marc
h 2
015
April 2
015
May
2015
June 2
015
July
2015
August 2
015
Se
pte
mber
2015
Octo
ber
2015
Novem
be
r 20
15
Decem
be
r 20
15
Rental rate, USD Rantal rate, UAH
$4
$4
$15
$8
$4
$4
$15
$60
$25
$20
$50
$20
$15
$8
$28
$300
Grocery supermarkets
Electronics supermarkets
Fashion gallery (100-200 sq. m.)
Department stores and large format clothes shops (600-1,500 sq. m.)
Cinema
Children‟s entertainment center
Restorants and Cafes
Kiosks, small gift shops…(1-10 sq.m.)
Overview of the retail property market of Kiev| Results I 2015
Brand Country SEC
Opened in 2015
adL/ADILISIK, women's clothing TukeyОсеan Plaza, Dream Town
Pyramida
Udress, designer clothes Ukraine Gulliver
Bosco, sports goods Russia Art Mall
Silenza, linen ItalyProspect, SkyMall, Dream
Town, Gulliver
Betty Barclay, women's clothing Germany Ocean Plaza
Marella, women's clothing Italy Ocean Plaza
Pimkie, women's clothing France Ocean Plaza
Superstep, footwear Tukey SkyMall
Coqui, footwear Gulliver
Hesburger, fast food Finland Novus ( Osokorki)
Laboka, footwear Tukey Ocean Plaza
Naturel, lingerie Gulliver
Oscar de la Renta, designer clothing
and accessoriesUSA Mandarin Plaza
Hunkemoller, lingerie Holland Осеan Plaza, SkyMall
Melvita, cosmetics France Ocean Plaza
Rene Lezard, clothing and
accessories for men and womenGermany Ocean Plaza
Intersport, sportswear "Epicenter” (at Polyarnaya)
Eterna, clothes for men Germany Gulliver
Maestrami, clothes for men Italy Gulliver
Stefanel, clothing and accessories
for men and womenItaly Manufacture
Baldaccini, footwear Poland Manufacture
18
Demand
Demand
Despite the difficult economic situation in the
country, in particular reduced solvency of the
population, reduction of commodity turnovers of
retailers, reduction of development plans, we have
seen a positive trend and the revival of the retail
market.
For 2015 in the Ukrainian market many new brands
debuted; the list contains Ukrainian companies
which allows to speak about the beginning of
restoration of the segment. In the current environment
actively developing Ukrainian producers got the price
advantage due to higher currency exchange rate. For
example, the Rivne Flax processing business under
the name of Goldi opened about 10 shops over the
year. Among foreign active networks are LC Waikiki
and Collin‟s which continued their development
thanks to positioning in the price segment of average
and average minus
Negotiations with a number of large international
operators proceed
(H&M, Cotton, Defacto, итд.), which aren't presented
in the Ukrainian market and which may appear in
2016-2017 along with the opening of new large-scale
projects of megamalls.
Overview of the retail property market of Kiev| Results I 2015
Launch of foreign brands in 2013 Brand Country SEC
Happylon Kazakhstan Ocean Plaza
LC Waikiki Turkey Ocean Plaza
Armani Jeans Italy Ocean Plaza
Cinnabon USA Ocean Plaza
Style Avenue Czech Republic Ocean Plaza
Z-Generation France Ocean Plaza
Petit Bateau France Ocean Plaza
Bebe USA Ocean Plaza
YAMAMAY Italy Gulliver
Versace Collection Italy Gulliver
Antica Murrina Italy Gulliver
Hadley Russia Ocean Plaza
Fabs Italy Gulliver
Nautica USA Sky Mall
Kanzler Germany Ocean Plaza
Camicissima Italy Gulliver
Agent Provocateur UK Gulliver
Launch of foreign brands in 2014
Mango Megastore(Mango,
Mango H.E., Mango kids)Spain Street retail
Pedro del Hierro Spain Gulliver
Sinsay (LPP Group) Poland King Cross (Lviv)
Keddo UK Street retail
Vittorio Spernanzoni Italy Street retail
Twin Set Italy Gulliver
Coffee Shop Company Austria Street retail (Lviv)
Paul France Street retail
Prenatal Italy Dream Town
Vapiano Germany Arena City
Peacocks UK Piramida
Paker - Ocean Plaza
Cazledonia Italy Karavan
Intimissimi Italy Karavan
Fika Sweden Street retail (Rivne)
Launch of foreign brands in 2012
Brand Country SEC
Furla Italy Ocean Plaza
Dolce&Gabbana Italy Mandarin Plaza
MaxMara Weekend Italy Ocean Plaza
Kari Russia -
Trussardi Jeans Italy Ocean Plaza
Camper USA Karavan
Napapijri Italy Ocean Plaza
Cinque Italy Ocean Plaza
Pepe Jeans Spain Ocean Plaza
Diesel Italy Street retail
Reiss UK Ocean Plaza
Why Denis Romania Ocean Plaza
Strellson Germany Ocean Plaza
Suvari Turkey Ocean Plaza
Michael Kors USA Ocean Plaza
Marina Rinaldi Italy Ocean Plaza
Atelier France Ocean Plaza
Valentino Italy Street retail
Piazza Italia Italy Ocean Plaza
W52 Jeans Portugal Dream Town
Gilda Tonelli Italy Ocean Plaza
KFC USA Ocean Plaza
S.Oliver Germany Sky Mall
Oviesse kids Italy Ukraine
Soocre Greece Ocean Plaza
Dynamics of appearance of foreign brands on the market of
Ukraine
19
Overview of the retail property market of Kiev| Results I 2015
Main players of the retail fashion market of Ukraine
No Group of companies Brands
1 MTIIntertop, Plato, Geox, Ecco, Skechers, Clarks, Marc O„Polo, Timberland, Armani Jeans,
Atelier de Courcelles, Napapijri ,Pandora, Urban United, Lee/Wrangler, Lenovo
2MD Group Tommy Hilfiger, Gant, G-Star RAW, OGGI, Accessorize, Walker, DKNY Men, Pepe Jeans,
Etam lingerie, Diesel, Fornarina
3City moda Marc Aurel, Reiss, Marina Rinaldi, Marc Cain, MAX&Co, Airfield, Rene Lezard, Bogner,
Braxx, Marella
4 LPP Group Reserved, Cropp Town, House, Mohito, Sinsay
5 Ultra jeans Levi‟s, Baldinini, Lagerfeld, Guess, Pierre Cardin
6 Delta Sport Nike, Converse, All Stars, Delta Sport
7 Argo Mango, Benetton, Promod, Parfois, Orsay, Desigual, Only, Piazza Italia, Aldo, Argo Center
8 Inditex Zara, Pull & Bear, Massimo Dutti, Bershka, Stradivarius, Oysho
9 TransUkrainaIntersport Tally Weijl, Pimkie, Karen Millen, Oasis, Warehouse
10 KarKat Fashion Group Springfield, Women'secret, Pedro Del Hierro, Cortefiel
11 BNS Trade Calvin Klein Jeans, Top Shop/Top Man, Michael Kors
20
Overview of the retail property market of Kiev| Results I 2015 21
• Within a year in the capital 2 objects were put into operation: Shopping
Center DOMA center (GLA – 7,000 m2) and Shopping Center Novus
on Zdolbunovskaya, 7Г (8,200 m2 hypermarket and 5,500 m2 of
trading premises), the second stage of SC “Gorodok” (hypermarket
Fozzi of 10,000 m2) was put into operation. Thus, the new proposal
amounted to 30,700 m2, thereby increasing the total amount by 3%.
As at the end of 2015 the total amounted to 1,107,039 m2 of
professional floor spaces.
• Commissioning of the «New Way» Community Centre (GLA –
16, 200 м2), located at the intersection of Verbitsky
str./Trostyanetskaya St. and the SC Respublica is postponed for 2016.
• Despite the number of the operating shopping centers the retail
property market segment of the capital is not saturated with high-
quality offer, share of objects of modern commercial architecture with
professional concepts does not exceed 20% of the segment.
• Commercial real estate segment experienced a difficult but stable year:
there was the partnership between tenants and developers, the
stabilization of rates and the level of vacancy.
• The market of the tenant who can receive now the most favorable
conditions has been created;
• In the Kyiv shopping centers it was succeeded to keep a binding of
rental rates to US dollar which are fixed on a quarterly basis;
• The percent from commodity turnover became the compensator of
rental rates drop;
• There was the commodity turnover redistribution and flows of visitors
among the commercial sites and retailers from the less successful to
more successful ones;
• Consumer confidence is gradually restored, but there are no
prerequisites for rapid growth;
• Tenants have become very selective in opening new stores in
connection with falling incomes and lack of available loan financing;
• Retailers optimized expenses, reduced unprofitable outlets, the most
progressive networks invested in marketing;
• For some retailers, the crisis has become the time of active
development;
• In the current conditions of exchange differences there were
opportunities and niches for work of the Ukrainian producers
• Since the second quarter of 2015 there has been a small increase in
rental rates in connection with stabilization of the exchange rate and
postponement of almost all new offer of this year for 2016;
• There are still good prerequisites for the purchase of new franchises in
view of the stabilization of the situation in the segment, good promising
places to launch and the minimum lease rates;
• Further development of the segment will be linked to the appearance of
new brands for the Ukrainian market ;
• In general for last year the trade segment took the course on
stabilization and showed positive tendencies. If the economic and
political situation in the country does not deteriorate we can expect
growth of turnover and enhance the development of retailers in the
second half of the year 2016.
Key tendencies of the retail property market
Trends and Forecasts
Overview of the retail property market of Kiev| Results I 2015
Consumer preferences of the inhabitants of Kyiv
22
• In the ranking by number of unique
customers the "Ocean Plaza” SEC takes
the leading position. 37% of the surveyed
residents of Kyiv have purchased clothing
and footwear in this SEC at least 1 time over
the past six months. This object has been
ranked by the level of loyalty in Kyiv. 22% of
respondents considered the “Ocean Plaza»
as the best.
• High rates by number of unique buyers show
shopping and recreation centers “Dream
Town" and shopping and recreation center
"Sky Mall" (27% and 25%, respectively). By
the level of loyalty prevails SEC «Dream
Town» (17%). SEC «Sky Mall» was chosen
the best in the city by 11% of respondents.
• On the chart objects attracting more than
10% of unique buyers are specified.
Purchases in shopping centers and opinion on the best
shopping center
*Details can be found in the distribution display in % of unique buyers. The unique buyer is meant as at least 1 purchase for the last six months. The quantitative survey of residents of Kyiv was conducted by method of the apartment standardized interview face to face. Selection of 800 respondents, maximum error is less than 3.5%.
15,3%
0,3%
0,6%
3,5%
4,0%
5,1%
5,1%
10,9%
17,3%
21,9%
9,9%
12,6%
11,0%
10,8%
12,9%
12,9%
11,0%
25,3%
27,4%
37,1%
None
Markets of the city
SC Darinok Metro station Lesnaya
SEC 'Gulliver'
SEC 'Prospect'
SEC 'Caravan'
SEC 'Bolshevik'
SEC 'Sky Mall'
ТРЦ 'Dream Town' (1,2stage)
SEC 'Ocean Plaza' M. Lybedskaya
Purchase of clothes and footwear
Best
Overview of the retail property market of Kiev| Results I 2015
Socio-demographic profile of residents of Kyiv
23
• The average level of the monthly family income of the Kyiv households makes about 8 647 hryvnias from which 70% are the share of
consumer expenses. The decrease in the level of consumer spending is accompanied by an increase in expenditure share of utility bills.
Average family income-is 8 647 thousand. UAH *.
People in the family - 3.22
Distribution by income level * Distribution of family expenditure, %
The quantitative survey of residents of Kyiv was conducted by method of the apartment standardized interview face to face. Selection of 800 respondents, maximum error is less than 3.5%.
0,6%
5,9%
13,1%
25,9%
10,5%
20,9%
4,6%
1,5%
17,0%
0,6%
5,9%
13,1%
25,9%
10,5%
20,9%
4,6%
1,5%
17,0%
Less than 2959 UAH
2960-4719 UAH
4720-6479 UAH
6480-8239 UAH
8240-9999 UAH
10,000 - 14,999 UAH
15,000 - 19,999 UAH.
20 thousand UAH and more
N/A
1,6%
2,0%
7,9%
18,6%
4,6%
5,2%
9,1%
13,1%
38,0%
Savings
Payment by credit
Transportation
Payment for utilities and other services
Dining out
Entertainment
Other purchases
Purchase of clothes and footwear
Products
Overview of the retail property market of Kiev| Results I 2015 24
Potential of the retail market of Ukraine
Saturation of the Kyiv marketwith shopping capacities,
in comparison with major European cities#11 Volume of retail commodity turnover, USD
0 500 000 000 000 1 000 000 000 000
Estonia
Luxembourg
Latvia
Croatia
Bulgaria
Belarus
Hungary
Finland
Portugal
Denmark
Greece
Norway
Ukraine
Belgium
Sweden
Switzerland
Netherlands
Poland
Spain
Italy
France
United Kingdom
Germany
The successful development and expansion of these retail networks in Ukraine:Auchan, Metro, Billa, Novus, Inditex Group, LPP Group, LC Waikiki, Mango, New Yorker
383
0 1 000 2 000 3 000 4 000 5 000
Warsaw
Prague
Bratislava
Paris
Budapest
Berlin
Sofia
Istanbul
London
Minsk
Moscow
Kyiv
Market saturation, GLA/1000 residents
Total market volume, thousand sq.m.2
Overview of the retail property market of Kiev| Results I 2015 25
Potential of the retail market of Ukraine
#15 Volume of consumer expenditures in the countries of Europe, USD
0 1 000 000 000 000 2 000 000 000 000 3 000 000 000 000
EstoniaLuxembourg
LatviaBelarus
BulgariaCroatia
HungaryUkraine
PortugalFinland
DenmarkGreece
NorwaySwedenBelgium
PolandNetherlandsSwitzerland
SpainItaly
FranceUnited Kingdom
Germany
0 200 000 000 000 400 000 000 000
Luxembourg
Estonia
Latvia
Bulgaria
Belarus
Hungary
Portugal
Denmark
Romania
Finland
Norway
Greece
Belgium
Sweden
Ukraine
Netherlands
Switzerland
Poland
Spain
Italy
Germany
United Kingdom
France
#9 Sales volume of grocery retail, USD
Overview of the retail property market of Kiev| Results I 2015
Contact information
Vadim Neposedov
Managing Director
Evgenia Loktionova
Company Director
Victor Oborsky
Head, Department of strategic consulting
Dmitry Terokhin
Analyst, Department of strategic consulting
"Ukrainian Trade Guild» (UTG) - the largest national real estate consulting company. Today, UTG is
55 highly qualified specialists and more than 500 customers. Participation in 450 business projects
and conduction of more than 700 researches of the market allow us to be a reliable, responsible and
competent partner.
Working with real estate of any size and type at different stages of the project, we ensure high
professionalism and individual approach to objectives.
This presentation is the publication of the generalized nature. "Ukrainian Trade Guild" bears no legal liability in
respect of the possible loss of third parties due to the use of the results of the report, nor for the information,
analysis and forecasts posted in this review
Any publication of information materials from the report in whole or in part is possible only with reference to the
company as the source of the data.
THANK YOU FOR YOUR ATTENTION
Contact information
"Ukrainian Trade Guild»
2A, Mechnikov str.,
(Parus business centre)
Kyiv 01601, Ukraine
Tel.: (+380 44) 537 23 64
www.utgcompany.com