UKRAINE RETAIL MARKET

RESEARCH & FORECAST REPORT| 2018

2018 | Ukraine 2

Retail market overview| Colliers International

SUMMARY SUPPLY

INDICATORS

. . . . commissioned: facilitiesfollowing were was in it theAs 2018 supposed, 314 1 to Kievquality space high in amounted end of2018 thethe total At supply of construction. 000 are GLA 650 under m² in completion 2019 of volume proved by theis unprecedented in terms development. property of It segment commercialattractive of market The Ukraini

Good Life Life Good 300 ~20 (GLA: m²); phase1 Rive Gauche, 000 ~12 (GLA: m²); Park Petri Retail 000 ~15 (GLA: m²); Plaza Smart

still remain

000 new scheduled for supply an retailan realestate

m² (GLA: ~ (GLA:

.

s -

2020. vka the most 7 5007

More than

m²);

1.8% 1.8% compa rate dropped has The vacancy by year. the 5, SCs/S the total Therefore, leased area of . . . . . 2019 centers among the main Currently, s .

3% (GLA: ~10 000 ~10 (GLA: m² Plaza Smart 13 OASIS~ 200 (GLA:m²). ~157 (GLA: Bloc 000 ~79 (GLA: m²); RETROVILLE 000 ~55 (GLA: m²); River Mall

are: are: compared to to compared of the beginning ECs in increasedECs has Kiev by

kbuster Mall kbuster sch

(GLA: ~15 000 000 m²). ~15 (GLA: eduled openingeduled for in red to 2017

000 000 m²);

).

.

h opping opping

DEMAND

Consumer demand Tenant demand

According to the State Statistics In 2018 the active demand for retail

Service of Ukraine, the real incomes space in Kiev from tenants was of the population (adjusted for observed. As usual, fashion inflation) for Q2 2018 have grown by operators were actively expanding 9.8% compared to Q2 of the previous their presence.

year. The following new operators worth

According to GfK Ukraine, the mentioning: H&M, Koton, DeFacto, Consumer Sentiment Index in Zara Home, All Saints, Penny Black, December 2018 grew by 2.4 points, Livly, Hugo, Polo Ralph Lauren, Tru

compared to index of November Trussardi, Laurel, Trollbeads, XTI, 2018 while in the past year it grew by Usupso, Ted Baker, Jo Malone, 1.9 points, amounting to 62.2 p. Killian, Emporio Armani and others.

VACANCY & RENTAL RATES

At the end of 2018 prime headline shopping venue) for 100-200 m² rent for 100-200 m² units in ’s units remained $ 83/m²/month.

most popular shopping centers The total vacancy rate in Kyiv increased and amounted to SCs/SECs reached 3.8%, having $75/m²/month. The prime headline dropped by 1.8 points compared with rate for Khreschatik St. (Kyiv’s main the end of 2017.

2018 | Ukraine 4

Retail market overview| Colliers International

STOCK TOTAL RATES RENTAL indominates sentiment Ukraine indicates** 100 negative below consumer Value that GfK UkraineSource: INDEX* SENTIMENT CONSUMERS’ Source : Colliers InternationalColliers :

SHOPPING IN

KYIV

, ths.

CENTER

m ²

2018 | Ukraine 5 Retail market overview| Colliers International

: Colliers International : Colliers International

Source

NEW BRANDS ENTERED THE MARKET IN 2018

VACANCY 2018 | Ukraine 6

Retail market overview| Colliers International

FORECAST

unprofessional and management. facilities first on impact, all,negative of small termsdeclared projects other level income it is But necessary to projects marketis to able the cities, European than significantly less 446 retail K space the in Considering the decrease result of expected,be wh rates retail vacancy of spaces should the developers, but ofincrease retail attractiveness of segment for which projects are scheduled in progress, in by Kiev 4 space the current increase supp in completion 2019 SCs/SECs are scheduledin for 6 About m European ² confirm

per per and1000 inhabitants 50

will be will be declared for with an outdated concept

000 of newm² space retail

in the s onces , commissioned Kyiv it If cities. ich may, in in itsmay, ich turn, it is it volume

may a have 8%. Many 8%. - 2020, which2020, may which iev, is

is lower assume take uptake again theagain commissioning

admitthat the

in rental rates.rental

most most all of of ly of ly of retail scheduled supply

than in d all

in that that

of of

. result decreasing of result of which demand, will entail decreasing of an excess supply will be purchasing by accompanied the in Newmarket should supply stable. in the countrysituation remains that provided political and economic will before market thatdid notoperatebrands on the Face. The North Calvin Decathlon, in 2019launched Among before projects probably visitors’ SECs will The

the increase commission

, as well as as, well as the distribution of tenants’ .

brands brands

flows.At will

t he power

be

competition competition among commissioning

income level

announced toannounced be postponed ing of new facilities

Supposed increasing

the , otherwise, there , are replenish Kleinphase) (first

rental rates.rental : IKEA, IKEA, : same

as

time over

thatother as a as a of

this list, of

it

some was ,

be

,

2018 | Ukraine 7 Retail market overview| Colliers International

2008 2004 2002 2009 2008 2009 2004 2004 2006 Year Year of 2012, 2013 1961, 2016 2003, 2016 2004, 2006,

commissioning

²

KYIV

, 6 200 8 600 8 500 8 800 26 80026 00015 00021 45 30045 00090 00015 50023 00033 GLA, m GLA,

²

9 000 33 00033 00020 00040 12 40012 60057 00030 78038 00045 00012 00030 167 167 000 GBA, m GBA,

Аddress Majorcompleted Shopping centers 2 Mayorova St. 12 Malynovskoho12 St. 2 B. Khmelnytskoho St. Moskovskyi23 Ave. 16b Moskovskyi Ave. Moskovskyi12 Ave. 34v Moskovskyi Ave. Ovrutska18 St. 1 Melnykova St. 6 Velyka Kiltseva St. 12 Luhova12 St. Obolonskyi1b Ave.

COMPLETED PIPELINED AND RETAIL PROJECTS

2) -

MAJOR

(phase 1

Name

Kvadrat on Lukianivka 4Room Gorodok Makros Plazma Blockbuster Promenada Center Karavan DreamTown Metropolis Central Department Store(TSUM) Poliarnyi

7 8 9 5 6 3 4 1 2 № 10 11 12

2018 | Ukraine 8

Retail market overview| Colliers International

34 33 32 31 30 29 28 27 26 25 24 23 22 21 20 19 18 17 16 15 14 13 47 46 45 44 43 42 41 40 39 38 37 36 35 №

Ukraina Europort Borshchahivska on Arkadia Bolshevik Borshchahivka on Kvadrat Park Promenada Epicentr Center Doma Aprel Prospekt Atmosfera Breeze Silver Art Mall Manufactura Gulliver 1)(phase Marmelad Piramida Aladdin InSilver Nab. Dniprovska on Arkadia Svit Dytiachyi Komod Perova on Kvadrat Mall Sky Global UA RayON Domosphera Magelan Araks Plaza Ocean Metrograd Plaza Mandarin 2 Globus (phase 1) Globus (phase

Name

-

3)

37 Zabolotnoho St. 37 Zabolotnoho Highway Novoobukhivkse village, Khodosivka Sq. 1 Sportyvna Borshchahivska 154 St. 4а Mishuhi St. 3а Hryshka St. 3 Sribnokilska Naberezhna 33 Dniprovska Ave. 1 Myru St. 3 Malyshko St. 4 Lunacharskoho Blvd. 36 Perova 2 Henerala St. 2а Balzaka St. 4 Lavrukhina Highway Stolychne 101 Ave. 13b Hlushkova Velyka 110 St. Antonovycha 176 St. Velyka St. 4 Baseina Nezalezhnosti Maidan Nezalezhnosti Maidan Ave. 3 Peremohy St. Lukashevycha 15а St. Borshchahivska 154 6 St. Yury 29 Hnata St. Kiltseva 4 Velyka St. Poliarna 20D St. 40 Budivelnykiv Ave. Kurbasa Lesia 19a St. Chervonohvardiiska St./ Chervonotkatska Highway Stolychne 103 St. Tychyny / Naberezhna Dniprovska Hetmana St. Hetmana Аddress Vatutina Ave. Vatutina Kiltseva

St.

GBA, m 154 000154 105 000105 30 500 28 000 30 000 18 000 18 100 16 000 16 500 38 000 13 000 27 000 90 000 15 000 60 000 10 000 75 000 38 000 22 000 50 000 25 000 63 000 16 000 16 000 12 800 33 000 12 000 20 000 14 000 40 700 97 000 66 000 6 900 9 000 –

²

GLA, m 22 300 22 400 27 000 72 200 10 000 24 000 15 800 40 000 11 800 43 000 70 000 41 400 30 000 16 000 35 500 15 000 45 000 23 350 12 000 10 200 10 000 18 400 11 700 10 000 19 100 67 000 24 000 7 500 9 600 9 000 6 000 8 000 5 800 6 000 7 500

²

commissioning Year of of Year 2009 2004 2009 2012 2001 2003 2002 2001 2003 2003 2007 2006 2003 2009 2014 2014 2014 2014 2014 2013 2013 2013 2013 2013 2004 2004 2011 2008 2008 1980 2007 2008 2007 2006 2012

2018 | Ukraine 9 Retail market overview| Colliers International

²

2015 2016 2016 2017 2018 2018 2018 2018 2018 Year Year of 55 00055 00079 00010 20013 10037 70056 157 157 000 100 000 135 000 GLA, m GLA, commissioning

²

*

8 000 7 500

² 13 56013 00017 30020 00012 00015 00015

127 127 500 GLA, m GLA, 2020 -

²

16 00016 50014 45051 140 140 000 116 000 245 000 120 000 150 000 298 000 GBA, m GBA, 2019

19 83019 70020 00011 00010 00030 00012 00025 10019 170 170 280 GBA, m GBA,

.

St

St.

)

Аddress

Аddress centers due complete to in Square

14 Dniprovska14 Naberezhna - 26 26 Peremohy Ave. Bandery Ave. - 21 Tymoshenka21 intersection of Obolonsky Prospect and Heroes of the Dnieper St. 2 Henerala Vatutina Ave. Zbolbunivska17 St. 1 Kiltseva St. 10 Pravdy Ave. Bandery Ave. Shcherbakova ( 7G Zdolbunivska St. VerbytskohoA. St. 6 Berkovetska St. Ak.16 Palladina St. 6 Ioanns Paulus St. Zdolbunivska17 St. 15 24 Shcherbakovskogo58

) Major Shopping

vka

phase 3

)

) Name Name Plaza

phase 1 phase Obolon) Retail Retail Park Petri Smart Nyvky Lavina Mall Academ City Good Life Rive Gauche ( Novus Way New Sky Sky ( Mall Rive Gauche (phase 2 Ocean Mall Respublika RETROVILLE Blockbuster Mall Smart Plaza ( Oasis River Mall

: Colliers International : Colliers International

8 9 6 7 5 3 4 1 2 № № 56 53 54 55 51 52 49 50 48 xpected that opening of some of the willpostponed. buildings be thatxpected ofopening some E * Source

FOR MORE INFORMATION

COLLIERS INTERNATIONAL EXPERTS

Igor Zabolotskyi [email protected]

Tetiana.Markovska [email protected]

Gulliver Bussiness Center 1-A Sportyvna Square 01001 Kyiv Ukraine The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has Tel. +38 044 499 00 00 been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of the material contained in this Fax +38 044 499 00 09 report. © 2019 Colliers International.

Research & Forecasting