Oleg Klopov, RDA: Now there are more open shops than there were before the full-scale war

Retail&Development Advisor (RDA), the manager of commercial real estate projects told how the Ukrainian retail market is growing, which retail chains are opening the most stores, and what is the reason for the increase in rental rates in the western regions of the country.
During the VII International specialized exhibition of the retail and commercial real estate industry RAU EXPO 2024, which took place in the capital on June 12-13, the manager of commercial real estate projects Retail&Development Advisor Oleg Klopov made a presentation "Analysis of the regional market of commercial real estate of Ukraine", which is based on the research of the Association of Retailers of Ukraine and RDA's own data. RAU chose the main theses of the speech.
About opening shops in full-scale war
According to the results of the first quarter of 2024, the number of stores operating in Ukraine exceeded the pre-war figure. RDA presented the relevant data as part of the study of the Ukrainian retail market in 2023-24. And such a dynamic growth in the number of stores took place from the middle of 2023 and the beginning of 2024. At the same time chains of the one dollar store format, food retailers, as well as the drogerie/pharmacy and fast-fashion segments grew most actively.
It is especially worth noting the opening of international chains: queues at Half Price, H&M and Zara. Almost all malls waited for the return of their favorite brands, after which they noticed an increase in traffic of up to 30%, especially in the first month after opening. And the leader of regional development in Ukraine during this period was the Polish brand Sinsay, which has already opened 35 stores outside Kyiv.
*Source of data: analytical study of the Association of Retailers of Ukraine "Ukrainian Retail in the Conditions of War"
About the increase in rates in regions with a high concentration of HPV
It is interesting that the greatest activity among trade networks was observed in regions with a high concentration of internally displaced persons. In this way, retailers logically reacted to the increase in the number of consumers in the regions, and developers were able to restore the level of rental rates in some places to the pre-war level. In regions with a high number of immigrants rental rates in shopping centers increased by up to 10% and in street retail - up to 20%.
The increase in rates in shopping centers occurs in small and medium formats with an area of ​​up to 200 square m. And large lots keep starting rates with a surcharge from turnover.
However, in the street retail segment there is even a shortage of locations, which is due to the high activity of local retail chains.
About today's challenges
At the same time in 2024 a large number of working shops and other enterprises in Ukraine began to face negative trends, which intensified due to changes in legislation and the deterioration of the security situation. Among the main problems mentioned by entrepreneurs were: business security (40%), lack of personnel (48%), lack of energy resources (67%) and rising costs for construction and operation (80%).
Each of the listed factors affects both developers and retailers. Without people you cannot open stores and build projects. Without electricity it is impossible to maintain the desired efficiency. And with high tariffs financial models reduce their profitability. Accordingly, without a stable income the purchasing power of the population will also fall. In addition, the threat of disruption slows down investment and keeps existing business owners in constant tension.
RDA believes that in the medium term these challenges may lead to negative trends in the market, however, Ukrainian retail has more than once demonstrated an amazing ability to adapt even to the most unfavorable circumstances.