“Uptown shopping centers have an average 10-15 percent real non-occupancy rate. For example, we have some clients who are facing bankruptcy, for whom we have cut rents by more than half. They will exit the market anyway, but I prefer to keep them there, until I find replacements, because I do not want to leave the space empty,” said Razvan Gheorghe, Managing Director of the Cushman&Wakefield consultancy company, a major shopping center administrator in Romania.
Retailers now facing bankruptcy are mainly family businesses which tried to seize opportunities, or contracted expensive franchises which they can no longer afford.
“We have had some isolated cases of one or two local retailers who we were forced to replace, but, since the beginning, we focused on strong, mainly international brands, who support our malls. So far, they have not requested to renegotiate their rents, because we applied low rents from the start,” said Iulian Dascalu, owner of Iulius Group, which has the largest shopping center network in the country.
Most affected in terms of non-occupancy rate are the malls which have just opened or which are to open in the near future. Their non-occupancy rate is a minimum 20 percent.
