Space saturation in shopping centres in Warsaw continues to grow, creating opportunities for the high streets in Poland's capital.
In the case of high streets, with the exception of high-end streets with luxury offerings, the core clientele is more random and consists of people who use the same routes every day on their way to work or school, and tourists, who stroll without any particular shopping goals in mind. Such clients are, by nature, more spontaneous, and need to be tempted by an exceptional experience, interesting store frontages, and a sense of novelty. They should be provided with an awareness of being in a fashionable place which is worth visiting. This, in turn, forces retailers to adopt different marketing strategies.
Anna Wysocka, Head of Retail Agency, JLL
Gastronomy vs fashion
Restaurants, bars and cafes account for nearly one third of Warsaw’s high street units, in contrast to a mere 15% share in shopping centres across the Warsaw metropolitan area. The rise of the F&B sector is largely underpinned by the growing affluence of Polish customers, who spend approx. 40% more on eating out than they did 10 years ago.
Joanna Tomczyk, Senior Analyst, JLL
Conversely, the category most commonly found in shopping centres - namely fashion - accounts for a mere 13% of the total number of high street stores in Warsaw. Most boutiques can be found on ul. Mokotowska, where fashion brands occupy nearly 30% of all units. There are numerous luxury high-end brands that form clusters in the vicinity of Plac Trzech Krzyży and Plac Teatralny.
Joanna Tomczyk, Senior Analyst, JLL
Services and grocery sectors are doing well
Interestingly, the share of local specialist stores (e.g. bakers or butchers) is relatively small. However, the development of this segment is likely to soon pick up stream. We are now seeing the completion of many new mixed-use projects, such as Elektrownia Powiśle, which are excellent locations for bakeries and health food stores.
Joanna Tomczyk, Senior Analyst, JLL
Rents and vacancy
Challenges and solutions
The answer to the challenges faced by high streets boils down to two elements. Downtown retail strategies in Warsaw have to increase expenditure to attract customers and tenants. We are now seeing substantial reinvestment in mixed-use and retail developments in central locations including CEDET, Hala Koszyki, Elektrownia Powiśle, and Browary Warszawskie. These projects not only bring a freshness to the urban surroundings, and provide customer experience that goes beyond just sales, but also has a positive ripple effect on adjacent streets. Another useful measure that could potentially bring back consumers to the high street would be to exempt these areas from the Sunday trading ban as is the case in Western European capitals.
Anna Wysocka, Head of Retail Agency, JLL
Poles’ shopping needs continue to evolve and are more often focused on experience. So Warsaw's high streets need to adapt and reinvent themselves. How? By introducing management strategies based on practices similar to those used in shopping centres. This change must happen in parallel with a constant improvement to the overall aesthetics and attractiveness of the high street. This process will likely require a great deal of time. Nonetheless, Warsaw has a great opportunity to diversify the local retail market and create new showcases on the city's map.
Jan Jakub Zombirt, Director, Strategic Consulting, JLL
