Cities such as Arad, Ploiesti and Iasi could all see five malls spring up in the coming years.
Postponed projects, lower rents and yields, and conversion of existing space are several things already included in developers' business plans, BUSINESS Magazin can reveal.
In Arad, two future malls will be developed face-to-face, Atrium Center and AFI Palace, which means the city will have the largest number of shopping centres per inhabitants.
This is a typical example of the general picture of over 100 malls and retail parks, which are planned on medium term in Romania.
Such an outlook should generate optimism among developers and consultants, but many believe the population's income is not high enough to sustain all the projects, particularly in medium-sized cities, where several retail parks, classic malls, or outlet centres are scheduled.
Arad is maybe the best example, with four malls and two retail parks under construction or in future development.
Overall, more than 200,000 square metres of lettable space will be available, in comparison to a population of almost 170,000, which translates at an average of over 1.1 square metres/inhabitant.
The rapid development of shopping centres outside Bucharest, where the last mall opened in 2005, has generated a unique situation - for the first time on the retail market, another city, other than Bucharest, is set to reach the largest area of shopping centres per capita. According to the latest report of Colliers International, the opening of Iulius Mall and Polus Center has led to Cluj reaching an average of about 0.3 square metres/inhabitant, compared with 0.05 square metres/inhabitant in Bucharest.
However, it is unlikely that the indicator's growth will reach the level calculated from putting together all the announced projects.
Monica Barbu, retail manager with Colliers International, as well as other real estate consultants, believes one must keep in mind that only part of the announced plans will be finalised.
While bankruptcy is still along way off, the first question marks have already appeared, with Mivan likely to stop development plans on its mall in Arad.
As regards the projects already under construction, developers say they will be finalised, being confident about their capacity to attract tenants and their ability to maintain yields at an average market level.
The fierce competition in some cities has been doubled by the tougher lending conditions.
Moreover, to get financing, a developer has to pre-rent a bigger percentage of the shopping centre than in previous years, a percentage that now stands at 60%, explains Monica Barbu.
In addition, tenants will be a major factor that determines the success or failure of a mall.
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