Stationary trade in Austria is recovering
As consumers trust brick-and-mortar retail, so does investor and retailer trust in the market. This is shown by the good number of 21 market entries in Austria in 2022.
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“Market entries are stable compared to 2021. This is particularly remarkable because the number of market entries in 2021 includes those that were postponed in 2020 due to the corona situation. Also: In 2022, the number of market entries was twice as high as in 2019. The focus of new entries is on luxury, but there are also new discounters and entries in the entertainment sector,” says Walter Wölfler, Head of Retail at CBRE Austria, who is also responsible for 2023 numerous new entrants expected.
Demand is still high in prime locations, and rents have developed accordingly: the prime rent in a top location in Vienna’s city center is 360.00 euros/m²/month. While the prime rent in shopping centers is stable at EUR 100.00/m²/month, it has risen to EUR 15.00/m²/month in retail parks. Yields stagnated at 5% for retail parks, increased to 5.25% for shopping centers and 3.95% for shopping streets by the end of 2022.
Retail is currently facing a number of challenges: increased energy costs, inflation, and a shortage of skilled workers. “It is not yet clear how and whether the measures taken by the government and the federal states to increase purchasing power – abolition of cold progression, various subsidies – will affect consumer confidence and thus retail in Austria,” says Wölfler.
It is also worth noting that, according to the preliminary figures available so far, the share of online trade in total retail sales in 2022 will decrease compared to the previous year. This is mainly due to the fact that 2022 was open again for the first time since 2019 and that two online market participants – Flink and Jokr – also left the Austrian market.