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Q3 Results in Retail Segment: Developers Double Pace of Shopping Center Construction in Moscow

In 2013 the Moscow retail real estate market will see the addition of 370,000 sqm of new retail space, which is 100% more than in 2012. The trend toward increasing volumes of new prime retail space will continue into 2014-2015. Over the next two years the volume of new premises coming on the market is estimated at over 1.1 million sqm, which represents record new growth for the post-crisis market, according to Colliers International’s report Retail Real Estate market in Russia: Q3 Update.
In September 2013 the Raikin Plaza shopping center with GLA of 35,000 sqm was opened by Tashir Group. The appearance of this new center in the third quarter brought the total supply of prime retail real estate in Moscow to 4.135 million sqm.


To date in 2013 eight new high-quality shopping centers have opened with a total area of 209,143 sqm. This represents an increase of 2.8 times from the same period of the previous year, when only six centers with a total area of 75,950 sqm GLA were opened. 


By the end of 2013 another 6 retail centers are expected to open along with the third phase of the Otrada shopping center for another 160,000 sqm GLA. The largest of these are the GoodZone and Reutov Park retail projects by the developers Immofinanz and Amma Development with 56,000 and 41,000 sqm GLA, respectively. Due to possible delays in the inauguration of certain shopping centers, the volume of retail area actually entering the market in the fourth quarter could be lower than predicted.  


If all projects announced for this year open on schedule, in 2013 Moscow’s retail real estate market will add 370,000 sqm, which is nearly twice as much as in the previous year.


The trend toward higher volumes of new retail space which began this year will hold true into 2014-2015. Furthermore, experts of Colliers International expect that over the next two years the share of large-scale projects in the total volume of supply in Moscow will increase. The largest retail centers scheduled for opening in 2014-2015 are Aviapark (235,000 sqm GLA), Columbus (140,000 sqm GLA) and Vegas Crocus City (111,400 sqm GLA).


Mikhail Sverdlov, Director of Retail Agency Department, Colliers International Russia, commented: «In the coming years we see great potential for the development of the capital’s retail real estate market in terms of the appearance of both large-scale projects and modestly sized neighborhood retail centers. This growth is being driven in part by the fact that today Moscow remains at the bottom of the list in terms of saturation of quality retail centers among Eastern European capitals and only in sixth place among Russia’s cities of one million or more in population.»