Retail Market Overview. Germany 2nd quarter 2018 Published in July 2018

Transcription

1 Retail Market Overview Germany 2nd quarter 2018 Published in July 2018

2 JLL Retail Market Overview July Economy and consumer sentiment more subdued After a promising start to the business year 2018, the ifo-institute made a significant downwards revision of its original German economic growth forecast from 2.6% to 1.8%. Whilst there was no sustainable deterioration in consumer sentiment at the start of the year, the HDE consumer barometer indicated a significant downturn by the month of June. The threat of a trade dispute with the USA, with further global effects still remaining to be quantified, is now also unsettling consumers. The propensity to invest has fallen significantly and expectations in terms of business and incomes are also deteriorating. Whether this development is just a temporary setback or will have a long-term effect on consumer behaviour remains to be seen. The anticipated retail turnover forecast for 2018 of 523 billion is still around 2% above the previous year s level. The growth in total turnover in both the bricks-and-mortar and online retail segments has ranged from 1.2% to 4.2% over the past five years, whilst Retail trade confidence in Germany the turnover in online trade alone has grown by 40% over the same period. Retail letting market stable at mid-year The retail letting market reported stable take-up figures for the first half of 2018, which turned out to be six months of stability after three quarters of negative growth in With a total takeup volume of 239,100 sqm and 521 individual deals, letting activity in the first half year was only around 7,000 sqm below the previous year s level. There has been a noticeable re-emergence of international concepts which contributed a share of 67% of total take-up (160,800 sqm) over the first two quarters; during the second quarter, this actually reached 80%. The most expansive retailers came predominantly from the discounter segment, irrespective of retail industry. In the fashion sector, TK Maxx and KiK leased four and six new stores respectively. In the sports sector, Decathlon leased four new stores and in the Retail lettings Germany in inner city locations Indicator points, balances ,000 sqm Source: GfK, ifo-institut GfK economic expectations GfK propensity to buy GfK income expectations Ifo business climate for retail (balances) GfK consumer climate index H1 18 Retail lettings Average annual take-up ( ): 503,000 sqm

3 JLL Retail Market Overview July furnishings/décor sector, the Dutch department store chain Hema took advantage of the gap left by Strauss to open five new stores; just as Woolworth with ten new department stores. There have been minor changes in the numbers of new leases by size category. Firstly, there has been a decrease in demand for small areas in the <250 sqm size category, whose share fell by around 3% points to 54% compared to the first half of By contrast, the two medium-sized categories with areas between 250 and 1,000 sqm grew to an aggregate share of 36% (H = 29%). The most active sector in this category was the restaurant/food sector with 56 deals, whilst the fashion sector accounted for most deals in the two smaller size categories with 76 new leases. This sector is also interested in the >1,000 sqm size category, in which it accounted for a stable share of 11% of deals. Of the 58 leases in this size category, over one third were taken-up by the fashion sector, and all were international concepts. Significant growth in share of total lettings in the Big 10 cities The share of take-up volume attributable to the Big 10 cities increased significantly to a total of 40% (96,300 sqm), compared to just 23% (56,600 sqm) in the first half of Berlin was again in first place with 17,600 sqm and most demand for space in the German capital was in inner urban shopping centres. Cologne was in second place (16,900 sqm), already above the full-year total from 2017, which had been a rather cautious year in the letting market. Leipzig was in third place (14,700 sqm) with 20 deals and there was active demand for space in all size categories. With the exception of Hamburg (7,900 sqm) and Stuttgart (6,100 sqm), the remaining seven cities all performed better than in the same period in This even applies to Frankfurt (5,600 sqm), where there has been a disappointing performance in the year to date despite a number of lettings, amongst others in the MyZeil shopping centre. Even Munich Number of deals Total Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Contractsbysizeclass Share Big 10* Share international concepts % 36% 50% 44% 45% 58% 66% 55% 53% 66% 100% 80% 4 % 7 % 17 % 2,000 sqm 1,000 to < 2,000 sqm Take-up Total (,000 sqm) Share Big 10* Share international concepts Q2 17 Q3 17 Q4 17 Q1 18 Q % 33% 37% 44% 35% 65% 73% 63% 55% 80% 60% 40% 20% 19 % 29 % 25 % 500 to < 1,000 sqm 250 to < 500 sqm 100 to < 250 sqm < 100 sqm * Berlin, Düsseldorf, Frankfurt, Hamburg, Hanover, Cologne, Leipzig, Munich, Nuremberg, Stuttgart 0% Pool: 521 lease contracts, Q

4 JLL Retail Market Overview July (8,400 sqm) will find it hard to achieve a full-year performance to equal its 5-year average of around 17,000 sqm. Fashion sector under further pressure 26% of space let over the first half of 2018 was attributable to the fashion sector, which is slightly below the full-year average of 28% from Nonetheless fashion still leads the take-up statistics amongst the sectors under review. The restaurant/ food sector remained in second place and was unable to improve its position despite continued expansion plans in the sector. The health/beauty segment (12%) weakened over the last half year, losing 6% points compared to Despite a number of large-scale lettings to the fitness operators John Reed and EasyFitness, this sector lost out to the furnishings/ décor sector (9%) and the sports/outdoor sector (8%), both of which had been increasingly active. The remaining sectors retained their shares at a stable level with variances. Lettings by business sector The fashion sector suffered most from the restrained demand for stores, and this is clearly reflected in JLL s first ever availability statistics for the Big 9 cities. This new figure is based on an analysis of 2,250 shops with a total sales area of around 2 million sqm. It has been calculated that around 8% of all retail space (155,000 sqm) is available on the market, and over half of all space on offer comprises clothing stores. Evaluation of textiles sector by rental area Textiles Discount retailers 5% 6% 8% 9% 9% 12% 26 % 19% Food/restaurants, etc. Health/beauty Furnishings/décor Sports/outdoor Department store Shoes/leather goods Telecomm./home electronics Banks/insurance Books/stationery Others 6 % 5 % 9 % 12 % 15 % 28 % 20 % Young fashion Clothing stores Ladieswear Ladieswear/menswear Kidswear Excl. fashion Menswear Pool: 239,100 sqm, Q Pool: 61,900 sqm, Q

5 JLL Retail Market Overview July No rise in prime rents expected We forecast that prime rents in Germany s 10 most important retail locations will remain stable in the second half of Only Hanover has experienced an adjustment with another slight fall of 3%. Looking at the rental price development by city size in all 185 retail locations under review, the greatest fall in rents compared to the first half of 2017 was in the two lowest population categories. The 100, ,000 population size category experienced a fall of around 3% and there was a fall of up to 5% in towns with populations under 100,000. The 250, ,000 category came out better with a fall of 2%. The cities with populations in excess of 500,000 including the Big 10 experienced a slight fall of 1%. This confirms that the smaller retail locations have the biggest problem with developments in the bricks-and-mortar retail segment. In contrast to the letting market, investor demand is still high, in particular for city centre retail properties. As a result and due to the scarcity of supply, yields fell again by 10 bps in four of the Big 10 cities over the past six months, with greater decreases of 15 bps in Hanover and Leipzig. Yields remained stable at between 2.6% and 3.85% in Frankfurt, Hamburg, Cologne and Stuttgart, the lowest yield analysed was still achievable in Munich. Prime rental index unit shops Index value 2000 = 100 H1 13 H2 13 H1 14 H2 14 H1 15 H2 15 H1 16 H2 16 H1 17 H2 17 H1 18 Average prime rent Big 10* Average prime rent Germany** * Berlin, Düsseldorf, Frankfurt, Hamburg, Hanover, Cologne, Leipzig, Munich, Nuremberg, Stuttgart, ** Basis 185 cities Prime yield unit shops % H1 13 H2 13 H1 14 H2 14 H1 15 H2 15 H1 16 H2 16 H1 17 H2 17 H1 18 Berlin Hamburg Düsseldorf Hanover Frankfurt/M. Cologne Leipzig Munich Nuremberg Stuttgart

6 JLL Einzelhandelsmarktüberblick July Retail lettings (in sqm) City H H Change yoy Average Berlin 17,600 13,500 30% 40,300 Cologne 16,900 6, % 19,700 Leipzig 14,700 1, % 9,400 Düsseldorf 14,300 4, % 16,800 Munich 8,400 5,200 62% 17,300 Hamburg 7,900 12,200-35% 22,600 Stuttgart 6,100 7,300-16% 18,000 Frankfurt/Main 5,600 4,000 40% 22,100 Nuremberg 1,900 1,100 73% 6,400 Hanover 1, % 5,200 Prime retail rents Big 10 City (street) H H Change yoy Forecast H Munich (Kaufingerstraße-Marienplatz) Berlin (Tauentzienstraße) Frankfurt/Main (Zeil) Düsseldorf (Königsallee) Hamburg (Spitalerstraße) Stuttgart (Königstraße) Cologne (Schildergasse) Hanover (Georgstraße) Nuremberg (Ludwigspl.-Hefnerspl.-Karolinenstraße) Leipzig (Petersstraße/Grimmaische Straße) Prime rent in Euro/sqm/month for a new letting, 100 sqm ground level with 6 m shop front % % % % % % % % % % 120

7 JLL Retail Market Overview July Deal Ticker Berlin 1 Roberto Cavalli 2 Diptyque (Pop-Up-Store) 3 Daluma 4 Daniel Wellington 5 CCC Schuhe Deal Ticker Düsseldorf 1 Starbucks Reserve 2 Mephisto 3 Furla 4 Uniqlo 5 American Vintage

8 JLL Retail Market Overview July Deal Ticker Frankfurt 1 Lululemon 2 Viviry 3 Miller & Carter Deal Ticker Hamburg 1 H&M Home 2 Arket 3 Westwing (Pop-Up-Store) 4 Hans im Glück 5 L Osteria

9 JLL Retail Market Overview July Deal Ticker Hanover 1 Hema 2 Tommy Hilfiger 3 VIU Deal Ticker Cologne 1 Butler s 2 Pikolinos 3 Uniqlo 4 Doc Martens 5 Topshop

10 JLL Retail Market Overview July Deal Ticker Leipzig 1 SØstrene Grene 2 Weekday 3 Mr. Spex 4 John Reed Deal Ticker Munich 1 Boss Store 2 Dior 3 Berluti 4 Weekday 5 AmbienteDirect

11 JLL Retail Market Overview July Deal Ticker Nuremberg 1 Burgerheart 2 Café Extrablatt Deal Ticker Stuttgart 1 Sephora 2 Depot 3 JD Sports 4 Notebooksbilliger.de

12 Contacts Jörg Ritter Management Board Germany, Retail Frankfurt tel +49 (0) Dirk Wichner Head of Retail Leasing Germany Berlin tel +49 (0) Sandra Ludwig Head of Retail Investment Germany Hamburg tel +49 (0) Anke Kaukars-Haverkamp Head of Shopping Center Services Germany Frankfurt tel +49 (0) Helge Scheunemann Head of Research Germany Hamburg tel +49 (0) jll.de For further information about JLL please visit our Company website jll.de/research For further Research reports please visit our Research website jll.de/buero Online offers of office properties for lease can be found on our property listing website Copyright JONES LANG LASALLE SE, No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of Jones Lang LaSalle. It is based on material that we believe to be reliable. Whilst every effort has been made to ensure its accuracy, we cannot offer any warranty that it contains no factual errors. We would like to be told of any such errors in order to correct them.