The activity of construction on regional retail real estate markets is growing, and the reconceptualization trend for existing shopping centers would remain, UTG Director Evgenia Loktionova has said. “The construction of retail real estate is growing, and not only in Kyiv. There are all prerequisites for increasing it in the regions, as the concepts of the last five years are moving into an active construction phase, which will significantly influence the existing market. I think active construction will move to regions, and Kyiv will finish the started projects,” she said at a press conference on the results of the real estate market for the first half of 2019 at Interfax-Ukraine on Wednesday.
At the same time, according to Loktionova, in the next two years the reconceptualization trend and redevelopment of existing facilities in the retail real estate market will continue.
“Our most “sleeping” regions, where there are not many shopping centers that felt comfortable enough in the absence of competition, will now feel serious pressure. This is Khmelnytsky, where two facilities of 50,000 square meters are being built, Vinnytsia with a facility of more than 50,000 square meters, Dnipro with a facility of more than 100,000 square meters. Thus, all new facilities will be built taking into account the existing current trends and new tenants in the market, respectively, this will allow new shopping centers to be ahead 10 years of the existing centers,” Loktionova said.
In general, according to her, among those announced for opening before the end of 2022, 44 projects with a total lettable area of 1.36 million square meters are at different stages of implementation in Kyiv and the nearest suburbs.
According to Head of the UTG Strategic Consulting Department Konstantin Oleynik, if these projects are implemented and launched, there is a prospect of a surplus of retail space, which will lead to an increase in vacancy and lower rental rates in obsolete facilities.
“There are large facilities that can significantly affect the distribution of forces in the market. Some of the loudest are the River Mall shopping and entertainment center, Blockbuster Mall shopping and entertainment center, Lukyanivka shopping and entertainment center, and the second stage of the Auchan Rive Gauche shopping and entertainment center. In addition, there are a number of facilities that have just been announced, for example, a multifunctional complex in Lesia Kurbasa Avenue, the White Lines complex entering the active phase, the Respublika shopping center frozen in 2014, Ocean Mall shopping center, April Mall shopping center, Retroville shopping center, Lesnaya Mall shopping center,” Oleynik said.
According to the expert, among the projects for reconstruction/reconceptualization in Kyiv is the Karavan shopping and entertainment center, which will turn into an outlet center, the Lukyanivka shopping center, the Dream Town shopping center, and the Gorodok Gallery shopping center. The tenants of the Sirius shopping center in Troyeschyna, which will become the New Way shopping center of the district format, will change, and the Marmelad shopping center will also be updated.
According to UTG, in 2019, the Smart Plaza Obolon shopping center and the Oasis shopping center opened.
Thus, as of the end of June 2019, there were six regional trading facilities operating in Kyiv, 26 – district, 24 – microdistrict, 18 – specialized and 32 detached hypermarkets.
Despite this, the company records a reduction in the vacancy rate of retail space to 5.5%, and the entry of new international retailers to the market, such as Decathlon and In Wear Matinique, contributed to this. Until the end of the year, another seven operators are expected to enter the market, among which are Ikea, The North Face, Eataly, Funday, and others.
According to the UTG’s information, the average daily attendance of the shopping and entertainment centers at the beginning of July 2019 is 677 people per 1,000 square meters, which is 4% higher than in the same period in 2018. In terms of saturation with high-quality retail space, Kyiv is ahead of Budapest and Sofia, with an indicator of 527.1 square meters per 1,000 inhabitants.
According to the company, rental rates in U.S. dollars have increased by $0.9 since the beginning of the year and amounted to $24-70 per square meter a month. At the same time, fixed rental rates for restaurants and cafes are $15-30, for large-format clothing stores (600-1,500 square meters) – $1.5-20, for fashion galleries (100-200 square meters) – up to $70, for cinemas – $4-15, for grocery supermarkets – up to $15.
The new Ukrainian chain of futuristic capsule hotels Monotel plans to open its first facility near Besarabska Square in August, and two more in Zoloti Vorota (Golden Gate) and near the Kyiv’s bike track – by the end of 2019, the press service of the operator has told Interfax-Ukraine.
“We are planning to open the first facility on Independence Day. It will be located at 9/28 Shevchenko Boulevard and will be designed for 28 people. It includes women’s and men’s bedrooms with 10 beds each and one bedroom for couples with four double capsules. The total area of the hotel is about 300-350 square meters,” Marketing Partner of the Monotel project Ksenia Chigarkina said.
According to her, the investor and owner of the first hotel is the ideologist of the Monotel network, Hanna Osypenko (previously headed the Capitol Invest company). Since the chain is planning to develop a franchise, the second and third hotels will follow the model of the first Monotel hotel with the participation of other private investors.
“By October, we will open a hotel in Bohdan Khmelnytsky Street, and in November-December – near the Zoloti Vorota. The hotel in Khmelnytsky Street will have an expanded format. It will be a monotel and a monohub, where you can work and live 24/7. These will be two independent facilities that will create a unique product on the market in a pair,” Chigarkina said, adding that the chain’ss plans include launching Monotel hotels in Lviv and Odesa, and also, possibly, abroad.
According to her, investments in the opening of the hotel total from $1,200 to $1,500 per square meter. Thus, the launch of one facility will cost about $400,000-500,000. Business owners expect to return the invested funds in two and a half or three years.
ARX Insurance Company (formerly AXA Insurance, Kyiv) in January-June 2019 collected more than UAH 1 billion in premiums, which is 23% more than in the first half of 2018, according to a press release of the insurer. The amount of insurance claim fee payments for this period amounted to about UAH 473 million, which is 4% more than in the same period of 2018.
The company notes that the main drivers of growth were KASKO with 19% more premiums collected, voluntary medical insurance with 43% more premiums, online sales with 2.1-time more premiums, agricultural insurance with 3.9-time more premiums compared to the same period last year.
As reported, from July 1, 2019 AXA Insurance was renamed ARX Insurance Company. AXA Life Insurance began operating under the ARX Life brand.
The companies continue to work with all the banks, car dealers, partners in the regional network, corporate clients, as well as with the same assistance companies and contractors. The main shareholder of both companies is Fairfax Limited (Canada).
Ukraine’s parliament, has ratified the international agreement on free trade between the Cabinet of Ministers of Ukraine and the Government of the State of Israel.
Some 230 lawmakers voted for corresponding bill No. 0223 at a plenary session of parliament on Thursday.
The Green for Growth Fund (GGF) will provide the Norwegian company Scatec Solar, represented by Scatec Solar ASA, with a loan of EUR 9 million for the construction of a 45 MW solar power plant near Bohuslav (Kyiv region).
According to a press release from GGF, this year this is the second major investment by the Norwegian company in the renewable energy fund in Ukraine. The first one was the project of the 250 MW wind farm Syvash (Kherson region).
In general, the fund’s investments in Ukraine amount to almost EUR63 million. This project will contribute to the country’s strategy to increase the share of renewable energy in its total supply to 25% by 2035, the fund said in a press release.
The Green for Growth Fund finances renewable energy projects aimed at reducing carbon dioxide emissions in 19 countries of South-Eastern Europe, the Caucasus, Ukraine, Moldova, the Middle East and North Africa.
Chornobyl nuclear power plant has officially received a new safe confinement (NSC) for subsequent commissioning from Novarka.
According to an Interfax-Ukraine correspondent, the handover ceremony took place at Chornobyl nuclear power plant with the participation of Ukrainian President Volodymyr Zelensky on July 10.
Upon completion of the transfer process, the plant will receive a license and proceed to operating the confinement complex and dismantling unstable structures of the Shelter facility.
“To implement this stage, additional financial resources are needed, first of all, from Ukraine,” the State Agency of Ukraine on Exclusion Zone Management said.
Earlier on July 10 Senior External Affairs Advisor at the European Bank for Reconstruction and Development (EBRD) Anton Usov wrote on Facebook that “22 years after the Chornobyl Shelter Fund was set up, the new safe confinement has now been launched and handed over to Ukraine.”
The international community raised EUR1.5 billion for the project, Usov said. The EBRD invested over EUR700 million. The confinement will serve at least 100 years and help solve the problem of removing the ‘sarcophagus’ over reactor No. 4, he said.
The construction of the NSC over the old Shelter began in 2012 following massive preparations on the site. The project was carried out by Novarka Consortium.
Due to the massive size of the NSC it had to be built in two parts, which were erected and successfully joined in 2015. Inside the NSC arc is a crane for removing the existing old Shelter Structure, or ‘sarcophagus,’ and the remainder of reactor No. 4.
The NSC has a service life of 100 years and cost EUR1.5 billion to build.
Pre-installation work and individual and comprehensive tests on its equipment and technological systems were carried out at the plant’s industrial site in March. In late April, the NSC was put into trial operation. It will run experimentally for no more than a year, after which, depending on its performance, it will receive the relevant license and proceed to full operation and the removal of the old Shelter.
