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Krakow Shopping and Retail market

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The retail market in Krakow began to develop in 1995. The first development of this type was completed by a local investor KrakChemia. The project combines a supermarket with a shopping mall and a household goods section being currently adapted by Castorama. Currently the shopping centre operates under the name of Alma Market, and covers approximately 23,500 sq. m. In the past years, this segment of the market was dominated by foreign networks from UK, France, and Germany. Retail chains, such as e.g. Tesco, OBI, Carrefour, and Castorama, each have more than one scheme in Krakow.
 
The total modern retail stock in Krakow is currently estimated at approximately 350,000 sq m. Apart from the newly opened GTC’s Galeria Kazimierz, all the retail schemes are situated in the non central locations, near the main transport roots.
 
Krakow Shopping KazimierzThe six largest retail schemes comprise approximately 50% of the total retail accommodation: Alma Market with Alma supermarket, M1 with Real hypermarket, Krokus with Géant hypermarket, Zakopianka and Czyzyny with Carrefour hypermarkets, and Krakow Plaza with an Intermarché supermarket. Some of these centres combine commercial function with leisure: in Zakopianka is the Atomic–Swiat Rozrywki amusement park, and in Krakow Plaza there is both a multiplex cinema and a shopping mall; Krakow Plaza is considered Krakow’s first “third-generation” commercial centre. Krakow’s Aqua Park is situated in the vicinity of the Krokus commercial centre.
 
The highest annual supply was recorded in the year 2001 when over 74,000 sq m of retail accommodation had been delivered to the market. Since the year 2002, the increase of annual retail supply was moderate and not exceeding 40,000 sq. m. In the year 2003, only the expansion of the Tesco hypermarket was completed, while in 2004 Kaufland hypermarket in ul. Pielegniarek as well as DIYs: Castorama (in ul. Walerego Slawka) and Leroy Merlin in Modlniczka near Krakow added to the stock. In 2005 the long awaited Galeria Kazimierz has been completed, increasing the stock by some 36,000 sq m, comprising 160 shops, Alma supermarket store as well as a 10-screen Cinema City. The scheme is the first to be located in the city centre.
 
A much more considerable annual supply is forecasted for the year 2007, when the Nowe Miato – Galeria Krakowska is scheduled for completion. The scheme, which construction has begun in 2004, will be the second after Galeria Kazimierz to be located in the city centre. Galeria Krakowska accommodates 60,000 sq m of retail space and is scheduled for completion spring 2007, although the initial statements suggested late 2006. Nowe Miasto – Galeria Krakowska is situated in the city centre, next to the Main Railway Station. The scheme will be the biggest commercial development to have been developed in Krakow. The first phase of the project, conducted by ECE includes 60,000 sq m of retail accommodation, with approximately 250 shops, 16-screen multiplex cinema, and numerous restaurants.
 
The chain retail tenants, apart from opening stores in the shopping cetres also open showrooms along the high streets. The most attractive area of Krakow are the streets inside the Planty Garden Ring, especially the Main Market Square (Rynek Glowny) itself. These are the areas of the densest pedestrian traffic – tourists, as well as Krakow residents, students, and daily commuters. The largest number of premises, after clothes - and shoe-shops, have restaurant -, café -, and pub operators. The most popular high streets are Florianska, Szewska, and Grodzka, where the most recognised brands are situated. Rental levels along those high streets range from PLN 80 to 300/sq m/month. Along Zwierzyniecka, Dluga and Karmelicka Streets, the monthly rents per square metre range from PLN 60 to 90.
 
These rates are higher than in shopping centres, where the average monthly renta level for a 100 sq m unit oscillates between €25 and 40/ sq m, depending on the location within the mall, the type of tenant, and the duration of the lease contract.
 
The increase in demand levels as well as entry to the Krakow’s retail market of international tenants (who are already present in Warsaw) can be expected. Renta levels are expected to remain stable or even face a slight increase upon delivery of the renowned city-centre projects.
 
(an excerpt from Knight Frank’s report commissioned by the Municipality of Krakow)