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Retail flourishes despite the pandemic

Beata Kokeli • 14/02/2022
Close to 0.5 million sq m of retail space was delivered in 2021 through 45 new projects, up by 12 compared to 2020. Small retail parks accounted for 43% of the new supply. More than 370,000 sq m was under construction at the end of 2021. Total retail sales volumes in 2021 improved by 8.1% compared to 2020. The pandemic and retail restrictions boosted the growth of e-commerce with online sales reaching 11.4%. Shopping centre footfall in November 2021 up by 9% compared to pre-pandemic.

Almost half a million square metres of retail space was delivered in 2021 across all retail formats through 45 new projects and 12 extensions. Net supply expanded by 370,000 sq m as close to 130,000 sq m had come off the market. The highest concentration of new openings was in Q4 2021 as almost 50% of the new retail space supply came on stream from October through to December.

“In 2021, small retail parks and new retail warehouses dominated the Polish market, accounting for 43% and 34% of the new supply, respectively. Another notable trend was the growing share of the newest retail format, i.e. retail space in large, mixed-use developments such as Norblin Factory and Warsaw Brewery, which made up 7% of the new supply,” says Ewa Derlatka-Chilewicz, Associate Director, Cushman & Wakefield.

Over 60% of the retail development pipeline will be delivered in smaller cities with a population below 100,000

At the end of 2021, more than 370,000 sq m of retail space was under construction and scheduled for delivery in 2022-2023. The largest projects underway are in Warsaw, Krakow, Bełchatów and Andrychów, but most are located in smaller towns. Retail parks account for more than 60% of the development pipeline.

Additionally, small and mid-sized retail schemes displayed more resilience to pandemic shocks in comparison with large and very large shopping centres. They reported significantly smaller decreases in footfall and turnover, and were able to make up for losses more quickly.

Retail sales up by 8.1% compared to 2020

Retail sales improved in Q4 2021, rising by 12.1% and 8% year-on-year in November and December, respectively. Last year’s total volumes grew by 8.1% compared to 2020.

In 2021, the strongest growth in retail sales versus 2020 was reported for textiles, fashion and footwear (up by 32%), motor vehicles (10.7%), pharmaceuticals, cosmetics and orthopaedic equipment (8.6%), as well as newspapers, books and specialized stores (7.3%).

Online shopping continues to gain traction

Retail restrictions boosted the growth of the Polish e-commerce market. Poland’s online retail penetration rate stood at around 5-6% before the pandemic, but it peaked at 11% during the ban on brick-and-mortar retailing before falling back to 8% as restrictions were eased. November 2021 saw the share of online retail sales rise to 11.4%, which is line with the trend seen in more mature markets where online shopping activity is the highest in November.

Retail categories with the largest share of online sales were fashion, multimedia (newspapers, books and other sales in specialized stores), as well as furniture, electronics and home appliances. 

Shopping centre footfall in November 2021 up by 9% compared to pre-pandemic

In November 2021, the average footfall for shopping centres and retail parks stood at 411,200, marking a rise for the first time since the pandemic. This represented an increase of 9% compared to 2019. Although the number of shoppers reached its highest monthly value of 443,600 in December 2021, it was still 8% lower than its pre-pandemic figure.  

“Retail footfall data indicates a fall of 17% on 2019 and a 15% increase compared to 2020. The previous year’s footfall volumes fell more sharply, averaging 28%. In the second half of the year, when shopping centres were required to follow strict hygiene protocols allowing 1 person per 15 sq m, footfall was down around 5% compared to 2019, which suggests that the sharpest falls are already behind us,” says Beata Kokeli, Partner, Head of Retail Agency Poland, Cushman & Wakefield.

Cumulative turnover for 2021 sees an uptick compared to 2020

Cumulative turnover data shows that retail sales were up in December 2021 by 9% year-on-year, but down by 13% on the same month in 2019. The average turnover for the whole of 2021 grew by 5% compared to 2020, but was down by approximately 25% on 2019’s level.
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