RAU asked leading market experts what results they ended 2024 with – the third year in the conditions of Russia’s full-scale invasion of Ukraine.

Traffic

In the summer of 2024, Russia resumed shelling of Ukraine’s energy infrastructure, so almost the entire hot season passed with power outages. Anomaly heat was also added. So SECs became points of invincibility, where you can eat, work, and recharge your gadgets. Deja vu with power outages also occurred in the fall. However, as Evgenia Loktionova, director of UTG, says, the return of the population to their hometowns, the reorientation and restoration of logistics chains, and the opening of Inditex contribute to the gradual restoration of SEC attendance. And in December 2024, this figure was 383 people per 1,000 sq. m. GLA. For comparison, in December 2023, it was 367 people.

However, Andriy Lototskyi, CEO of the consulting company Retail&Development Advisor, noted that the increase in attendance applies to those facilities that qualitatively used marketing tools to attract customers, improved comfort for visitors and tenant-mix. “Thus, the best shopping centers became even more attractive to customers and traffic grew by up to 20% compared to 2023, while those that were less active in investments and innovations showed a decrease in traffic. The only exceptions are shopping centers in the western regions, where the population continues to increase, and there are still not enough professional shopping centers,” says Lototskyi.

For the Respublika Park SEC, 2024 is a year of record performance. Traffic grew steadily. On weekdays, the SEC received more than 65,000 people, on weekends this figure exceeded 100,000 people. And on the anniversary day, a record number of visitors came to the charity concert of the Antitila band – 127,845 people.

The attendance figures of Arricano shopping centers in 2024 were influenced by many factors, in particular, an increase in the number and duration of air raids, especially in regional projects, where in certain months the alarms lasted up to 50% of the working time, a missile strike on Kryvyi Rih and damage to the Sonyachna Galeriya SEC in January, a change of the food operator in shopping centers in Zaporizhia and Kryvyi Rih, etc. However, despite everything, the number of visitors in general for the group and in Kyiv SECs in 2024 exceeded the figures of 2023.

Turnover

Respublika Park SEC confirms 47.5% increase in turnover in 11 months of 2024 compared to 12 months of 2023.

Kyiv Arricano projects demonstrate more stable growth in turnover than regional ones. “In general, the growth of Kyiv fashion operators is on average 10-15%, sporting goods – up to 20%, electronics stores – 20-30% compared to last year. At the same time, in regional projects, the turnover of tenants of these product groups increased by an average of 5-10%, which was directly influenced by the peculiarities of work in front-line areas,” comments Inna Morozova, Marketing Director of Arricano.

Anna Koryagina, International Tenant Representation Director Nhood Holding and CEO Nhood Ukraine, referring to the report of partners – NAI Ukraine – says that official retail turnover increased by 20.2% in hryvnia and 6.9% in US dollars in 2024 compared to 2023.

And Lototskyi notes that the increase in turnover in the country as a whole is demonstrated by the fast fashion category, but not uniformly: “Seasonality has left its mark, but consumer purchasing sentiment is influenced by military, political and, especially, foreign policy factors, of which there were quite a few this year. Therefore, it is quite difficult to compare similar periods with 2023. Most categories, at best, remained at the 2023 level.”

Rental rates

According to Koryagina, rental rates generally ranged from $5 to $55 per square meter. Due to the active growth of turnover and the return of all major international retailers after the launch of new projects that can attract new brands to the Ukrainian market, the maximum price may increase to $70.

Lototskyi notes that those SECs that invested in developing their attractiveness for customers had the opportunity to increase rental rates by 10-15%. And others were forced to resort to point reductions in rental payments depending on product categories.

About the top operators

In 2024, Spanish retailer Inditex returned to Ukraine, international brands showed an increase in turnover, the country’s SECs rotated tenants, increasingly giving preference to Ukrainian and sports brands. Thus, according to Anna Koryagina, the popularity of sports retail is growing globally. According to the latest report from Business of Fashion, in 2023, sportswear grew faster than the overall fashion market by 2-3 percentage points in China, by 5-6 percentage points in the US and by 2-3 percentage points in Europe. Fast-growing “challenger brands” are now expected to account for 57% of the sportswear segment’s economic profit, almost tripling since 2020. In 2024, new brands such as Deckers (owner of Hoka) and Asics are expected to generate over 50% of the economic profit of the sportswear segment, surpassing traditional players such as Nike, Adidas, Puma and Under Armour. The sportswear market is expected to continue to grow faster than the overall fashion market, due to the increasing popularity of an active lifestyle and sports among different age groups. For the Ukrainian market, this trend is also relevant, as highlighted by such examples as the recent opening of a new Adidas Originals store in the Respublika Park SEC, the opening of a mono-brand Oakley store in the center of the capital, the confirmation of the opening of flagship formats of sports brands in the Ocean Mall project, and the opening of Nike, Intersport, Puma, All Stars, Marathon in the Blockbuster SEC in 2024. Of course, the return of H&M and Inditex to the Respublika Park SEC significantly increased traffic. Also in May, the Vsi.Svoi space was opened on 1000 sq. m, where more than 50 Ukrainian brands are presented, and in September the flagship Sport Life with a swimming pool was launched. “Ukrainian brands are demonstrating a good trend: active expansion, some have already scaled to the network and, of course, competitive ability – price-quality. In total, more than 30 new stores and establishments opened in the SECs in 2024. Among them are international brands Adidas, Adidas Originals, KFC. Specialized establishments also appeared: the Doctor Sam medical center, car dealerships, Nova Poshta. The OKWINE wine market, Ibis, the Jacky China bistro, the Kids Republic children’s dream store opened on large areas. As well as conceptual restaurants and establishments: Avocado, Miminoshi, Pesto Cafe, Kyiv&Food, About the River, Duck Stories,” comments Yulia Shchaslyva, General Director of the Respublika Park SEC.

“Ukrainian brands and sporting goods demonstrate a desire to develop networks, which is a positive motivation for other market operators to analyze their offer and keep up with the latest trends and consumer sentiment,” confirms Morozova.

Forecasts and plans for 2025

According to Loktionova, the approaching surplus of retail space contributes to the gradual redistribution of consumer flows between facilities, increasing vacancy and downward correction of rental rates in most regions of Ukraine. Arricano will continue to invest in improving the customer experience in all shopping malls in Kyiv, Zaporizhia and Kryvyi Rih and in the construction of the Lukianivka SEC in Kyiv. Respublika Park SEC will continue active business development and new landmark openings and large-scale events are planned for 2025.

In 2025, Ocean Mall is to open in the capital, with a total area of ​​300,000 sq. m., with a rental area of ​​over 117,000 sq. m. The developer promises that 800 stores will be presented, among which are expected stores of the most important international fashion groups in flagship formats, an entertainment section at a level that simply does not yet exist in the country, as well as other retail formats.