Tverskaya and Nevsky lose attractiveness at fashion retailers, but rental rates are not reduced

Despite the active development of shopping centers, the operators of clothing and footwear stores never lost interest in placing their stores on the central streets of cities. The flagship store of the brand on Tverskaya in Moscow or on Nevsky Prospekt in St. Petersburg, on the one hand, performs an advertising function, on the other - being in the way of the main tourist flows, such points have a fairly large cross.

However, according to the company's retail real estate analysts Necklaces International Russia, fashion-operators began to leave the main street of Moscow two years ago. Such brands as Zara and Escada left Tverskaya. “It is noteworthy that the premises occupied by the Escada boutique is still empty,” says Veronika Lezhneva, director of the research department at Colliers International Russia. In the current quarter, Tverskaya left the clothing and footwear store Yulia Prokhorova.

According to Veronika Lezhneva, basically, the change in the composition of the pool of tenants is due to the following factors: a high level of rental rates, reluctance of owners to meet tenants and change rental conditions, financial problems of tenants, lack of parking along Tverskaya. “However, rental rates on Tverskaya have increased compared to December 2015,” she says. Today, Tverskaya Street presents such shoe stores as: Rendez-Vous, Baldinini, FABI. These boutiques of fashionable shoes have long been present on the main street of the capital and continue to function. In general, the first place in the occupied space on Tverskaya is held by catering establishments, clothing and footwear operators are second on the list, with a share of 14% in the overall structure of operators.

“According to our observations, fashion retailers mainly seek to occupy premises in shopping centers, where sales revenue is higher than sales revenue from stores located on the main shopping corridors in Moscow,” Veronika Lezhneva comments. Meanwhile, Colliers International Russia experts attribute Bolshaya Dmitrovka, Petrovka, Stoleshnikov pereulok and Pyatnitskaya to the popular streets of Moscow in terms of fashion retail.

The structure of operators on Tverskaya Street by activity profile, Q3 2016

Source: Colliers International

Saint Petersburg, Nevsky Prospect

For the 3rd quarter of 2016, the share of vacant premises on the main shopping streets of St. Petersburg, according to experts of a real estate consulting company JLLincreased by 0,6 percentage points - from 6,5% to 7,1%. An increase in the volume of vacant space was caused by an increase in rental rates. According to JLL, the maximum rental rates on the market of central trading corridors in St. Petersburg, characteristic of the main part of Nevsky Prospect (up to Vosstaniya Square), increased in the 3rd quarter of 2016 from 12 thousand to 13 thousand rubles. per sq. m per month (including VAT). Rental rates on Staro-Nevsky Prospekt also increased: the upper limit increased from 5 thousand to 6 thousand rubles. per sq. m per month (including VAT).

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On the main part of the highway Nevsky Prospekt, an increase in the volume of free space amounted to 1,7 percentage points, up to 3,5%, on Staro-Nevsky Prospect - 1,7 percentage points, up to 11,4%. “Some tenants were not ready to support higher rental rates, which led to the release of a number of street retail facilities in the city center.

Maximum rental rates on the street retail market of St. Petersburg

Source: JLL

In St. Petersburg, fashion-chain operators, in addition to Nevsky and Staro-Nevsky, are popular for such locations as Vladimirsky, Zagorodny Avenues, as well as Bolshoy Avenue of the Petrograd Side. At the same time, Vladimirsky and Zagorodny Avenues remain the main shoe corridor of the city, while Sadovaya Street lost its position: shoe stores began to close there one and a half to two years ago.

“In general, fashion operators today tend to open stores in successful shopping malls and are less active in the street retail format,” says Alexander Prosenkov, head of the street retail department at Colliers International in St. Petersburg. - The opening of flagship stores in the street retail format, nevertheless, is still of interest to the players of the fashion market, since they work for brand recognition, however, in this case, established shopping corridors are usually considered, where stores of other operators of this segment are already represented ".

Structure of operator profiles on Nevsky Prospect, Q3 2016

Source: Colliers International