Activity of international and Ukrainian retailers has revived attention of developers to building retail real estate in all large cities of Ukraine, UTG consulting company (Kyiv) has told Interfax-Ukraine. “The decline in consumer confidence in Europe, the rapid development of online commerce, the high level of competition in the clothing and footwear segment, the growth of staff salaries led to a decrease in profit margins and a pile of inventory at the largest European retailers, forced them to look for new markets, stimulated exit and the opening of stores in markets of countries not previously covered,” Head of Strategic Consulting at UTG Kostiantyn Oliynyk said.
So, after many years of negotiations, the leading international retailers presented earlier in the country began to return to the national market of Ukraine: H&M, Decathlon, Koton, Defacto, Polo Ralph Lauren, Kilian, AllSaints, PennyBlack, Tru Trussardi, Laurel, XTI, Santoni, Jo Malone, Daniel Hechter and others.
According to him, by the end of 2019, at the various stages of implementation (construction, preparatory work, concept) in Kyiv and the nearest suburbs there are 44 projects with a total rental area of 1.46 million square meters, in Odesa – 15 projects with a total rental area of 419,400 square meters, in the Dnipro – more than 100,000 square meters, in Kharkiv – more than 124,000 square meters, in Lviv – more than 80,000 square meters.
At the same time, the purchasing power and potential of retail space is limited by the size of salaries (in Kyiv – UAH 16,249; in Odesa – UAH 9,473; in Kharkiv – UAH 9,453, in Lviv – UAH 9,729), the pace of their growth, and the size of consumer expenses (in Kyiv – 62.2% of total family income; in Odesa – 67.6%; in Kharkiv – 62.9%, in Lviv – 71.80%) and the growth of the cost of housing and utility services, maintenance/rental of housing, travel, transportation, communication, education, medicine, as well as the level of inflation and the exchange rate of the national currency.
In addition, the success and functioning of retail real estate is significantly influenced by the volume and structure of the existing supply. So, in Kyiv there are five regional, 27 district, 24 micro-district, 19 specialized and 32 separate hypermarkets with a total area of just over 1.6 million square meters. The current offer of Odesa is 449,100 square meters, Kharkiv – 503,400 square meters, and Lviv – 399,100 square meters.
At the same time, the retail real estate offer is constantly increasing. In 2019 alone, the Smart Plaza Obolon micro district shopping centers (GLA is 11,800 square meters) and the Oasis shopping center (GLA is 7,800 square meters) were opened in Kyiv, and the regional River Mall (GLA is 62,200 square meters) and Blockbuster Mall (GLA is 135,000 square meters), the Araks specialized center in Khodosivka (GLA is 10,000 square meters) and street retail located at 2, Kyrpy Street (GLA is 2,500 square meters).
In addition, on December 7, the Karavan Outlet updated shopping center (GLA is 45,300 square meters) was announced for opening after restyling and reconstruction.
“As a result, in the case of the implementation and commissioning of all declared large-scale projects in local markets, a surplus of retail space may occur, which will entail a redistribution of consumer flows between facilities, an increase in vacancy and a correction in rental rates downward, especially in obsolete facilities with serious conceptual flaws,” Oliynyk said.
In his opinion, the approach of saturation and changes in the market are already becoming noticeable, and some developers have begun comprehensive modernization, redevelopment, specialization, or restyling of their retail facilities. For example, such facilities as Karavan, Metrograd, Silver Breeze, InSilver, Lukianivka Kvadrat, Gorodok, Magellan, Marmalade, Dream Town and Sirius started the update. In addition, Oliynyk said that a number of owners of the malls plan large-scale changes in the near future.
Official rates of banking metals from national bank as of December 18
One troy ounce=31.10 grams
National bank of Ukraine’s official rates as of 18/12/19
Source: National Bank of Ukraine
The MoneyGram international payment system jointly with Industrialbank (Kyiv) have launched the Account Deposit project, under which clients of 55 financial institutions in Ukraine, which are partners of the payment system, will be able to receive money remittances to the current account or card account from anywhere in the world, Board Chairman of Industrialbank Mykhailo Bukreyev has said.
“This product is innovative for our market, in fact, it allows minimizing both financial costs and the time spent,” he said at a press conference at Interfax-Ukraine in Kyiv on Tuesday.
At the same time, he said that the Account Deposit project has been operating in test mode since November 2019.
MoneyGram Regional Director for Russia, the CIS, and Baltics Evgeny Butyugin said at the press conference that Ukraine is a dynamically developing market for money transfers. He recalled that according to the National Bank of Ukraine (NBU), in 2018, the volume of transfers amounted to more than $11 billion, and according to the World Bank, this figure amounted to more than $14 billion.
“Part of our strategy is to develop digital channels [for money transfers] in the country,” Butyugin said.
According to him, the partner of the Account Deposit project was chosen among the existing agents of the payment system in Ukraine.
“We have chosen our colleagues – partners from Industrialbank. The bank fully complies with the requirements of the American global public corporation. Firstly, they successfully passed a compliance audit. Secondly, we were able to agree on mutually beneficial commercial conditions. Thirdly, I would like to note the involvement of both the bank management and the project team in this project, thanks to which we were able to jointly be the first to launch this product on the Ukrainian market in the shortest possible time,” Butyugin said.
At the same time, he said that low tariffs are thanks to the use of digital service channels, which reduce the costs of both MoneyGram and Industrialbank.
According to Head of the Banknote Banking Department of Industrialbank Andriy Lvov, to make a money transfer, the client just needs to have a current or card account in the bank, he or she does not need to come to the office. According to Lvov, transfer fees under the Account Deposit project range from 0.5% to 2% of the transfer amount.
“Our plans are to take a market share of 5% of all transfers in Ukraine,” Lvov said asked about plans for the development of the Account Deposit project.
Industrialbank was founded in 1990. In December 2017, it was merged with Express Bank.
According to the NBU, on October 1, 2019, in terms of total assets (UAH 4.645 billion), Industrialbank ranked 28th among 76 banks operating in the country.
MoneyGram International, founded in 1940 in the city of Minneapolis (the United States), is one of the leaders in the global money transfer market. Its network consists of more than 357,000 branches, including retail chains, financial institutions and national postal services in more than 200 countries. The company has more than 14,000 branches in Ukraine.
Ukrainian President Volodymyr Zelensky says he is convinced of the need for joint development of transport capabilities with Azerbaijan, the presidential press service said.
“We should make full use of the unique transit potential of our countries and develop the appropriate infrastructure. We agreed to intensify cooperation in international aviation, road and railway transportation,” he said at a joint press briefing with President of Azerbaijan Ilham Aliyev in Baku.
In addition, the parties agreed to hold a meeting of the Intergovernmental Commission of Ukraine and Azerbaijan in Kyiv in January. Zelensky noted that he expects “specific cases after this meeting, investments with very specific terms” following this meeting.
Special attention was paid to joint projects in the space and aviation sectors, in particular in aircraft construction.
Azerbaijan’s leader, in turn, called the negotiations fruitful and noted that Azerbaijani businessmen show a significant interest in cooperation with Ukraine, but much depends on the results of the intergovernmental commission.
AZERBAIJAN, COOPERATION, INTERNATIONALTRANSPORTATION, UKRAINE
SkyUp Airlines during the summer navigation schedule in March-June 2020 will launch flights from Kharkiv to Batumi, Tbilisi (both Georgia), Burgas (Bulgaria) and Tel Aviv (Israel).
According to the press service of the company, in particular, flights from Kharkiv to Batumi will start on May 29, 2020. They will be serviced on Tuesdays and Fridays. The price of the one way ticket starts from UAH 1,900 without baggage.
Flights from Kharkiv to Burgas are planned from June 2, 2020. They will be performed on Tuesdays. The price of the one way ticket starts from UAH 1,600 without baggage.
Flights from Kharkiv to Tel Aviv will be launched from March 29, 2020. They will be serviced on Thursdays and Sundays. The price of the one way ticket starts from UAH 2,400 without baggage.
Flights from Kharkiv to Tbilisi are also planned from March 29, 2020. They will be performed on Mondays and Thursdays. The price of the one way ticket starts from UAH 1,800 without baggage.
SkyUp Airlines LLC was registered in Kyiv in June 2016. The founder is ACS-Ukraine LLC of Tetiana and Yuriy Alba, who also own the JoinUp! tour operator.
