Q1 2022 results in the street retail segment: vacancy has grown
According to the results of Q1 2022 the volume of vacant space demonstrated slight increase by +0.2 p.p., and average level was 9.7%.
Maximum increase in the volume of vacant space occurred in the shopping area of Liteyny Prospekt (+4.5 p.p.) and Rubinstein Street (+4.1 p.p.). In the shopping areas of Bolshaya Konushennaya and Sadovaya streets an increase in the number of vacant premises showed up (+2.5 p.p. in every area, respectively).
It should be noted that on Nevsky prospect - the main shopping corridor, the number of empty retail spaces has been decreased by 1.7 p.p. The vacancy in this zone reduced to 9.6%. The relative stability of tenant occupancy was demonstrated by the shopping areas of Bolshoy prospekt PS, Vosstaniya and Belinsky streets.
Main developing directions of street retail market in the main shopping corridors are trading and catering. The largest part in the tenant structure is occupied by tenants of the trade sector – 47% (–1 p.p. to H2 2021), catering – 32% (–1 p.p. to H2 2021). Service sector companies account for 9%.
According to the results of Q1 2022 the increase in volume of vacant area was, mainly, due to the closure of public catering (45%), fashion-operators (25%), retailers FMCG-sector (10%).
The largest number of catering establishments in the first quarter closed on Rubinstein Street and Vosstaniya Street (4 establishments, respectively). In terms of the number of openings of new catering establishments in the analyzed period, the Nevsky prospekt shopping area was in the leading position (+4 catering).
According to the outflow of fashion operators in the 1st quarter, the shopping area of Bolshoy prospect P.S. was on the first place (3 outlets closed). The closure of stores was not an indicator of a decrease in interest in this shopping area on the part of fashion operators: Bolshoy prospect P.S. also leads in the number of newly opened clothing, footwear and accessories stores (+3 shopping points).
In total Q1 2022 can be characterized by a low level of activity on the part of new tenants. At the same time, the expansion of retail points by some operators in the central trade corridors led to the preservation of the volume of vacant space at almost the same rate.
A feature of the beginning of the year in the market of built-in retail premises was the increase in the number of stores of electronic cigarettes, hookahs and smoking mixtures located on the central trade corridors (Nevsky prospect – +3 points, Vosstanya street and Bolshoy prospect 1 point each).
According the results of Q1 2022, the number of closed enterprises exceeded the number of opened enterprises by 14%.
Going low level of business activity in the market of built-in retail premises in St. Petersburg is evidenced by the declining indicators of tenant rotation. So, if we do not take into account the Q1 2020 values of the pre-pandemic, when this indicator reached the level of 5.6%, in Q1 last year it was 1.8%. According to the results of Q1 this year – only 1.3%. In Q1 the maximal tenant’s activity was observed in Vosstaniya street – 3.5% (against 2.1% in Q1 2021). In Q1 the tenant rotation level on Nevsky prospect fixed at 1.5% (against 2.3% in Q1 2021).