Food halls are opening at an accelerated pace in Russian cities

The growth in the opening of shopping centers and the popularity of domestic tourism are accelerating the development of food halls. Up to 33 facilities are expected to open in 2024, up 57% from the previous year. So far, the fastest pace of openings remains in Moscow, but market participants see potential in regional markets as well. And experts warn that growing competition threatens an increase in the number of closures of facilities with an unsuccessful location and concept.

In 2024, 33 food halls with a total area of ​​78.6 thousand square meters are planned to be launched in Russian cities. m, which will be 57% more than the number of openings in 2023, according to estimates from the NF Group. According to consultants, 14 new food halls could open in Moscow, 6 facilities in St. Petersburg, 13 spaces in other cities. Since January, one food hall has been launched in Moscow, St. Petersburg, Novosibirsk, Rostov-on-Don and Penza, the NF Group clarified.

Natalia Kireeva, Deputy Regional Director of the NF Group Consulting and Analytics Department, associates the development of the format with the transformation of traditional food courts into food halls. Investors have apparently become convinced of the effectiveness of food halls, notes RestCon CEO Elena Perepelitsa. The trend is also facilitated by the growth of domestic tourism, says Irina Blagoveshchenskaya, vice-president of the Federation of Restaurateurs and Hoteliers. As Deputy Prime Minister Dmitry Chernyshenko reported, in 2023 the flow of tourists in the Russian Federation increased by 20% year-on-year, to 78 million trips.

Alexandra Mamokhina, Director of Strategic Marketing and Product at Level Group, adds that the increase in openings of catering facilities is also associated with the commissioning of new shopping and business centers postponed until 2024. According to CORE.XP estimates, 800–900 thousand sq. m. are planned to be commissioned in Moscow in 2024. m of offices, three times more than a year earlier. Nikoliers expects the delivery of about 155 thousand sq. m. in Moscow. m of retail space, which could also triple the 2023 result.

According to NF Group, there are currently 63 food halls operating in Moscow with a total area of ​​206.3 thousand square meters. m, in St. Petersburg – 16 objects for 55.6 thousand sq. m. m, in other regions – 42 food halls on 91 thousand sq. m. m. And although in Moscow the number of food halls exceeds the number of facilities in other regions, the pace of openings here remains high.

General Director of food hall operator Market Liner Maxim Gurzhiy says that in the regions the development of the format is hampered by a lack of experience among investors, insufficient awareness of the demand for such projects and limited resources. Food hall operators often find it difficult to find quality tenants, continues Lenar Kutlin, CEO of the Gagawa restaurant chain. Development Director of the developer Gremm Group Artem Bukin adds that many consumers in the regions are accustomed to visiting classic cafes and restaurants or traditional food courts in shopping centers.

Although the founder of the Zemskiy Group (Eat Market brand) Vladislav Zemsky points out that in Moscow, due to the saturation of the market, the launch of a new food hall is only possible in a location with high traffic or if there is a successful concept, but the regions may have good prospects. Among the developing projects of the Zemskiy Group, he highlights Novosibirsk, Penza and Sakhalin, adding that the company has projects in development in other cities.

Natalia Kireeva warns that growing competition in the food hall segment is leading to an increase in the number of closures. According to her data, 19 facilities have closed in Moscow over the history of the format. Not all such spaces turn out to be successful in terms of area, location and variety of corners, notes Artem Bukin. Elena Perepelitsa adds that food halls can open in former industrial zones, where it is difficult to attract traffic.

For restaurateurs, such concepts are also not always attractive. Lenar Kutlin says that the Gagawa chain does not open in food halls due to the small number of premises and rather high rental rates, which do not always guarantee constant traffic. Catering operators are accustomed to special rental conditions, no matter where they open, points out Elena Perepelitsa.

Daria Andrianova