Trade | markets
31.07.2023
What: JLL
The At 112,000 m², take-up of space has remained almost constant for six quarters
The German rental market for retail properties held its ground in the first half of 2023, especially with large lettings of 2,000 m² and more from the textile industry. With a letting volume of 213,000 m² in the first half of the year, of which 112,000 m² in the second quarter, the market closed at about the same level as the previous six quarters and only around two percent below the half-year value of 2022. The share of large deals in the total letting turnover rose from 25 to 38 Percent. The strong increase in this size class was mainly due to the textile retail sector with 51,000 m² in the second quarter and a total of 98,100 m² in the first half of the year. While the total take-up of space remained almost constant, the number of new leases fell from 470 to 414 year-on-year.
Dirk Wichner, Head of Retail Leasing JLL Germany: “The textile sector is regaining its old strength and is clearly leading the field again in the industry comparison with 46 percent. Some brands have done their homework during the pandemic, implemented a multichannel strategy with stationary and online retail and present themselves in both areas in a customer-oriented manner. But not only the sales side, but also the logistical infrastructure with its delivery services has been improved in many ways. This is where the wheat has been separated from the chaff in recent years.” Especially during the lockdowns during the pandemic, expansive local suppliers had ensured numerous rentals in top locations, so that the gastronomy/food industry had temporarily taken the lead. “In addition, it is now becoming clear again that the textile industry is able to use large areas, which the catering industry is only able to do in exceptional cases,” analyzes Wichner.
The share of the second-placed gastronomy/food industry continues to shrink and only comes to 23 percent. The weakest result in the past four years. Although there is demand for gastronomy space and new international system gastronomers are still penetrating the German market, such as the seafood chain Big Easy or the French Big Mama Group, it is primarily space in the small and medium-sized segment that is rented in this segment. Around half of the turnover came from the food sector. The Asian chain Go Asia was particularly active with five rentals. Health/beauty remains the third strongest sector with eight percent and loses one percentage point compared to the first half of 2022. The classic drugstores were reluctant to rent this time.
Hamburg and Berlin benefit from newly developed quarters
Meanwhile, when looking at the cities, the ten real estate metropolises are continuing their upward trend from the first quarter of 2023. With 106,500 m² for the entire first half of the year, they are around 22 percent above the previous year’s result and account for exactly half of the total turnover in Germany. Just ahead of Berlin (29,500 m²), Hamburg (30,400 m²) took first place this time. “The good result is due, among other things, to the redevelopment of the Überseequartier with numerous lettings,” says Wichner. Berlin is also benefiting from a project development, the “Am Tacheles”, where the first retail tenants have already moved into their premises. Stuttgart (9,500 m²) completes the leading trio at some distance. After a rather weak letting year in 2022, the metropolis got off to a good start in the new year with a few lettings around Königstrasse.
Frankfurt, Düsseldorf and Cologne are in the middle with solid results between 7,000 m² and 9,000 m², but mainly booked lettings in the smaller and medium-sized space segment. In addition to Hanover and Nuremberg, the field is also completed by Leipzig and Munich, both of which are registering rather subdued demand for space and are therefore not able to match the results of the previous year. “Munich is currently well below its five-year average, which is not due to demand but to the fact that not all retailers are willing to keep up with the high price level. Owners, on the other hand, argue that the highest sales are also achieved in Munich and often insist on their demands,” Wichner describes the situation on the Isar.
Die Top rents in medium-sized cities are falling by an average of six percent
In the case of top rents in the retail sector, there are further rent reductions across all classes of residents. For the ten largest shopping cities, the decline in prime rents compared to the same half of the previous year was the smallest at 2.1 percent. Four major cities were able to keep their top rents constant, including Leipzig, Nuremberg, Munich and Stuttgart. For the other six cities, the reductions were between two and four percent. Locations with less than 100,000 inhabitants and cities with 250,000 to 500,000 inhabitants had to accept the highest losses of around six percent on average. With an average minus of 4.1 percent, the population class between 100,000 and 250,000 is in the Germany average of the 66 cities examined. Constant rents were recorded for 21 locations outside of the ten major cities in the past year, including Freiburg, Dresden and Münster.
#Textile #Industry #Retail #Comeback #Konii
