2009 - CRE

12
News:
Leasing­agreements­have­been­signed­
with­three­anchor­tenants­of­the­"Vegas"­
Shopping­and­Entertainment­Center­(pre-
viously­-­"Kashirskiy­Mall").­The­retail-
ers­-­"Ashan"­and­"M.video"­are­renting­
22,000­and­3,700­sq.­m.­respectively,­and­
a­multi-plex­cinema­Lyuksor­will­take­up­­
5,500­sq.­m.­in­the­shopping­and­enter-
tainment­center.­This­was­announced­
by­Art­Properties,­the­consultant­in­the­
project.­"Ashan"­and­"Lyuksor"­have­
concluded­17-­year­lease­agreements­
and­M.video­–­a­10­-year­agreement.­The­
leasing­rates­have­not­been­released.­Art­
Properties­says­that­78%­of­the­shopping­
center­is­now­occupied.­
The­"Vegas"­Shopping­and­
Entertainment­Center,­being­imple-
mented­by­the­"Crocus­Group",­is­located­
at­the­intersection­of­Kashirskoye­Shosse­
and­the­24th­kilometer­of­the­Moscow­
Ring­Road,­close­to­the­"Tvoy­Dom"­
Hypermarket.­­The­formal­opening­of­
"Vegas"­is­scheduled­for­September­2009.­
The­shopping­and­entertainment­center's­
398,000­sq.­m.­will­hold­300­shops­and­
boutiques,­a­hypermarket,­a­multiplex-
cinema,­an­ice­rink­and­a­theme­park.­
Investments­in­the­project­are­estimated­
at­10.9­billion­rubles.­
According­to­Ivan­Nazarov,­a­leading­
consultant­of­"Magazin­Magazinov,­in­
association­with­CB­Richard­Ellis",­the­
project­is­enormous­in­scale,­even­for­
the­pre-crisis­period.­"I­presume­that­
the­project­will­have­trouble­sticking­to­
its­original­concept.­Additionally,­this­
project­has­been­leased­out­at­relatively­
high­rates.­According­to­our­information,­
many­tenants­are­now­in­the­process­of­
renegotiating­their­pre-crises­leasing­
agreements.­Given­the­determination­
of­owners­to­stand­firm­on­leasing­rates­
and­the­current­economic­situation,­the­
center­may­well­lose­some­of­its­tenants­
before­opening­day,"­emphasized­Mr.­
Nazarov.­
Tatyana­Klyuchinskaya,­the­direc-
tor­of­commercial­real­estate­at­Colliers­
International­noted­that­"Ashan"­and­
"M.video"­usually­lease­space­at­low­
rates,­often­demanding­that­leasing­pay-
ments­are­set­as­a­percentage­of­total­
sales­turnover.­"Though­the­leasing­
rates­at­the­complex­have­not­changed­
dramatically,­there­had­been­slight­down-
ward­adjustments­from­those­in­existence­
during­the­pre-crisis­period.­I­believe­that­
even­"Lyuksor"­tried­to­base­its­leasing­
rate­on­a­percentage­of­turnover­–­and­
in­this­way­achieving­a­discount­in­the­
neighborhood­of­20-30%,"­she­suspects.­
"Such­tenants­could­pay­rents­in­
access­of­$1.5­million­per­year,­a­movie­
theater­-­$600-800­thousand,­but­the­
main­issue­here­is­not­the­final­amount­
of­the­payment­and­not­the­dynamics­
of­reducing­or­increasing­rents,­but­in­
the­readiness­of­anchor­tenants­to­sign­
leasing­agreements.­This­is­particularly­
true­for­major­centers,­where­investments­
often­exceed­100­million­dollars.­An­
anchor­tenant­means­more­than­rental­
income­for­a­developer,­it­is­a­primary­
way­to­attract­other­tenants­and­increase­
consumer­traffic­to­the­shopping­center,"­
says­Alexander­Tishkov,­national­director,­
Russia­&­CIS,­head­of­the­retail­agency­
department­at­Jones­Lang­LaSalle.­­
3 Anchors for the "Vegas" Shopping
"Svetofor"­opens­in­
Lyubertsy
The­Svetofor­Shopping­and­Entertainment­Center­opened­
for­business­in­Lyubertsy.­The­new­center­has­a­total­area­
of­33,500­sq.­m.­and­is­located­in­the­heart­of­a­residen-
tial­quarter­on­Pobratimov­Ulitsa.­Some­of­the­largest­
tenants­in­the­shopping­and­entertainment­center­are:­­
Ostrov­Supermarket,­Sportmaster,­Snezhnaya­Koroleva,­
O'Stin,­Ile­de­Beaute,­Beliy­Veter­Tsifrovoy,­City­Obuv,­
Glenfield,­Collin's,­OGGI,­Academiya­Detstva,­Eldorado,­and­
Bukva.­
The­entertainment­part­is­home­to­the­Svetofor­
Cinema­(a­multi-plex­cinema­developed­by­the­complex­
in­partnership­with­DVI­cinema),­a­food­court,­a­2000-sq.­
m.­fitness­center­(managed­by­the­Fitness­Holding)­and­a­
children's­entertainment­center.­
The­Svetofor­Group­of­Companies­is­the­developer­of­
the­project.­In­charge­of­concept­development­and­leasing­
operations­is­Magazin­Magazinov,­in­association­with­CB­
Richard­Ellis".­
The­construction­of­the­SEC­began­in­December­of­2007­
and­the­center­was­fully­ready­by­January­of­this­year.­
Since­there­is­a­shortage­of­modern­shopping­and­enter-
tainment­centers­in­Lyubertsy,­the­premises­have­been­leased­
at­relatively­high­rates­–­this­is­what­CRE­was­told­by­the­PR­
department­of­the­project's­consulting­company.­Total­invest-
ments­in­the­project­-­1.3-billion­rubles.­
First­phase­of­"Topol"­­
SEC­opens­
The­"Topol"­shopping­and­entertainment­complex­opened­its­
doors­for­the­first­time­in­Ivanovo.­This­announcement­was­
made­by­the­Ross­Group,­which­is­in­charge­of­implementation­
and­management­of­the­SEC.­The­"Topol"­SEC­is­a­multifunc-
tional­complex­and­combines­a­retail­shopping­area­with­a­
food­court­and­an­entertainment­section.­
On­opening­day­two­of­the­SEC's­anchor­tenants­were­
already­up­and­running­-­the­"Riat"­food­hypermarket­and­
"M.video"­household­appliances­and­electronics.­The­retail­
section­has­room­for­150­shops,­many­of­which­are­already­
occupied­by­the­likes­of:­Coquette­Revue­Lingerie,­"Butterfly"­
Cosmetics­and­Perfumes,­"Tsifrograd"­Mobile­Electronics­and­
Computers,­Formoza,­"Svyaznoy",­and­the­clothing­stores­
"Tvoyo"­and­In­style.­Opening­soon­will­be­the­Nikol,­"Nega",­
Serge,­Fashion,­Discount­365,­"Yevroset"­and­many­others.­
Final­contract­negotiations­are­being­carried­out­with­Adidas­
and­Reebok.
The­entertainment­section­is­located­on­the­third­floor­of­
the­complex.­The­"Trans-Force"­entertainment­center­will­be­
the­first­to­offer­its­services­here.­
The­complex­should­be­in­full­operation­by­October­this­
year.­The­total­area­of­the­first­phase­is­35,000­square­meters,­
with­the­leased­portion­being­21,000­square­meters.­The­
investor­and­developer­of­the­project­is­"TT-Invest"­LLC.­The­
construction­took­two­years­to­complete­(started­in­January­
2007)­and­700­million­rubles­were­invested.­The­leasing­rates­
are­in­the­range­of­500-3,700­rubles/sq.m.­per­month.­
Investment­Inactivity
The­considerable­investments­and­debt­financing­from­
Western­markets­for­a­few­years­prior­to­the­crisis­creat-
ed­prosporous­times­for­both­the­seller/developer­and­
the­customer.­Today’s­potential­for­raising­funds­on­the­
open­capital­markets­has­practically­disappeared.­Not­
one­Russian­company­working­on­the­real­estate­market­
succeeded­in­raising­money­through­an­IPO­in­2008,­
although­many­planned­to­do­so­(RosEvroDevelopment,­
LenSpecSMU,­Don-Stroy,­DVI­Holding).­This­is­due­to­
the­profound­changes­to­the­strategies­of­most­institu-
tional­investors­which­started­to­pull­out­of­developing­
markets­having­lost­considerable­sums­following­an­
unprecedented­crash­on­the­stock­exchanges­and­a­vir-
tual­collapse­of­the­stock­quotes­of­development­com-
panies.­In­the­current­financial-economic­conditions,­
investment­activity­will­remain­very­low­until­mid-year.­
Knight­Frank
Leasing­rates:­back­to­
2007
The­drop­in­leasing­rates­for­office­facilities­continued­
in­January­–­especially­for­Class­A­space­in­prime­areas.­
Rates­for­Moscow's­best­offices­are­presently­the­same­
as­in­the­summer­of­2007.­The­total­floor­space­leased­
in­January­represented­some­65,000­sq­m,­comparable­
to­figures­of­2007­and­2008­(2007­–­79,000­sq­m,­2008­
–­75,000­sq­m).­The­deals­in­January­were­for­com-
pleted­space­in­existing­facilities.­No­single­preliminary­
leasing­agreement­has­been­observed.­Regardless­of­
the­large­number­of­finished­offices­available­on­the­
market,­77%­of­all­leased­spaces­were­un-fit­areas­in­
newly­completed­buildings.­Despite­the­difficulties­
with­funding­we­see­a­considerable­number­of­new­
construction­projects­–­especially­in­the­Class­B­sector.­
The­number­of­vacant­premises­in­January­increased­
considerably­and­represented­on­an­average­some­16%.
Cushman­&­Wakefield­Stiles­&­Riabokobylko
Asia­Overtakes­Europe
According­to­a­survey,­Office­Space­Across­the­World­
2009,­conducted­by­Cushman­&­Wakefield,­Hong­Kong­
and­Tokyo­top­the­list­of­the­most­expensive­leases­for­
offices­in­the­world­with­London­coming­in­third.­Class­
A­office­space­in­Hong­Kong­cost­as­much­as­1,743­
Euros­per­sq­m­a­year.­Moscow­moved­from­5th­to­4th­
position­with­1,276­Euros­per­sq­m.­The­study­compared­
office­lease­expenditures­in­202­business­centers­in­57­
countries­worldwide.­In­58%­of­business­centers,­the­
rating­showed­an­increase­in­rental­rates,­26%­stayed­
the­same­and­16%­saw­a­drop.­Only­1%­of­cities­saw­
a­drop­in­2007.­Leasing­rates­for­quality­offices­grew­
worldwide­on­average­by­3%,­which­is­lower­than­in­
2007­by­14%­and­is­the­lowest­increase­since­2004.­
Elaine­Rossall,­head­of­business­space­consultancy,­
C&W,­said:­“Most­markets­in­2008­showed­constant­
growth­which­began­to­fall­at­the­end­of­the­year.­Not­a­
single­region­was­spared­by­the­global­financial­crisis."
Cushman­&­Wakefield­Stiles­&­Riabokobylko
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