Buyers stayed at home – Newspaper Kommersant No. 2 (7447) dated 01/10/2023

The New Year holidays did not convince Russians to return to shopping centers: their attendance in Moscow and St. Petersburg was 10-15% lower than last year and more than 30% lagged behind 2020 figures. Part of the facilities and networks managed to demonstrate good performance due to the growth of domestic tourism, cold weather and optimization of work. But in general, traffic continues to be constrained by low purchasing power and a decrease in the range of stores. Experts expect an increase in attendance at shopping centers in the spring.

The Mall Index indicator (the number of visitors per 1,000 sq. m of retail space) in Moscow shopping centers in the first week of 2023 lagged behind the same period in 2022 by 15%, in St. Petersburg — by 10%. Compared to the beginning of 2020, the Mall Index was lower by 36% and 31%, respectively. Such data is provided by Focus Technologies. The mood of buyers during the New Year holidays continued to be influenced by the desire to save money and the decrease in the range of familiar stores due to the departure of foreign brands, says Mikhail Vasiliev, head of research and consulting at Focus Technologies. According to him, the market remains heterogeneous: the indicators of small-format objects are better than those of large shopping centers.

Magic Group President Alexander Peremyatov agrees that during the holidays, the attendance of shopping centers was on average 30% behind pre-pandemic levels, and the conversion rate for some retailers decreased by 1.5 times. Purchasing power as a whole has declined, and the remaining demand has been depleted by constant sales that accompanied the exodus of some foreign brands from the country, he notes. Eterna CEO Dmitry Tomilin does not consider the decline in traffic during the holidays to be critical, citing low conversion as the main problem. “From the fact that crowds of people walk past shop windows, no one has become richer,” he notes.

Maria Drits, Commercial Director of Malltech, says that attendance at the company’s shopping centers during the holidays increased by 7% over the year, which is partly due to sanitary restrictions in place in the regions of presence in early 2022. Depending on them, the dynamics for different shopping centers ranged from minus 20% to plus 30%, she says. Ms. Dritz estimates the decrease in traffic relative to the period before the pandemic at an average of 22%. Dmitry Kostomakhin, director of CORE.XP’s retail property management department, says that the attendance of the company’s regional shopping centers turned out to be comparable or 5-7% higher than last year. According to him, entertainment, catering and sporting goods stores showed positive dynamics, while electronics stores, on the contrary, experienced a decline.

Baon President Ilya Yaroshenko says that in the Moscow stores of his network, the traffic during the holidays was 5% lower than last year, and in St. Petersburg it turned out to be comparable. The chain’s revenue grew by 30%. Gloria Jeans Board Chairman Vladimir Melnikov says attendance at his stores in Moscow during the holidays increased by 16.4%, in St. Petersburg – by 29%. Revenue also showed positive dynamics. In Letual, they talk about a 10% increase in traffic across the entire network, in St. Petersburg – by 23%.

Ilya Yaroshenko associates a relatively good picture with a high tourist flow to the largest cities of the Russian Federation and the redistribution of traffic from closed stores. “The weather this year is helping to sell outerwear, and a small order for the season does not make it possible to discount goods heavily,” he said. Evgeniya Khakberdieva, regional director of the NF Group retail real estate department, believes that in general there were more people in Moscow during the holidays than a year earlier: in addition to shops, visitors to shopping centers were attracted by ice rinks, cinemas, playgrounds, etc.

Alexander Peremyatov doubts that the shopping center market as a whole will be able to return to pre-pandemic levels. And Mikhail Vasiliev does not rule out a slight increase in attendance in the spring with the beginning of the implementation of pent-up demand, when consumers will reduce their inventory, formed on the wave of last year’s hype.

Alexandra Mertsalova, Alina Savitskaya