Investments in retail real estate in Moscow:
Shopping malls remain an attractive investment option despite the rise in online shopping and changing shopping behavior. Even in the context of the corona crisis, successful retail facilities retain their tenants and feel a decrease in traffic only during the period of hard lockdowns. The editors of the Shopping Centers Russia magazine decided to talk about how to remain successful in a difficult time for the industry, using the example of FPC Garant-Invest.
Two exemplary years
In 2020, FPC Garant-Invest managed to retain 96.4% of tenants, and in 2021 to reduce the vacancy rate in its shopping centers to 2-3% and return revenue to the pre-pandemic level of 2019, which is an unconditional benchmark for the industry as a whole.
The company is confident that there are three key growth drivers that guarantee the profitability of shopping centers in Moscow now and in the future, with the right concept and proper location. Firstly, these are the high
rates of housing construction and the migration of wealthy people to the capital from other regions of Russia. Secondly, this is the development of transport infrastructure in Moscow: the opening of new metro and MCC stations, the construction of a transport hub, the launch of the so-called chords and diameters, which through the capital also connect different directions of the Moscow region. And finally, thirdly, inflation favorably affects the future of shopping centers: for retailers, unlike the population, price increases are a plus.
Growth Plans
In 2022–2025, Garant-Invest Commercial Real Estate JSC plans to increase its real estate portfolio by 300,000 sq. m through the construction of new facilities, including a new generation shopping center WESTMALL in the west of Moscow, as well as the acquisition of a number of existing facilities for subsequent modernization and renovation. The total volume of already planned investments is 60 billion rubles. It is also planned to sell one object annually, where, after the modernization, its maximum market value will be reached.
It is planned that by the end of 2025, the number of projects implemented by FPC Garant-Invest will increase from 18 to 30, and the number of objects owned will increase from 16 to 25.
Profitable even in times of crisis