2018 saw a continued fall in the maximum rents obtainable for retail space in Hamburg’s City district. The top rates to rent space in some of the established locations dipped by €10 to €20/m² per month below the prior year’s level. “With a return of rents to a moderate level, even in exclusive locations, it has been possible for new, innovative concepts to gain a foothold on the Hamburg market, thus expanding the range of retailing options available,” explains Sven Bechert,
head of Retail at Grossmann & Berger, a member of German Property Partners
Rents for large premises falling most
Currently, the highest attainable rent in Hamburg’s inner city is €290/m²/month for shops on Spitalerstrasse sized between 80 and 120 m². This is €20 less than in the year before. A similar drop in rates is especially notable for larger premises offering between 300 m² and 500 m². Spitalerstrasse, Mönckebergstrasse and Jungfernstieg are among the streets thus affected. This development is partly a result of property owners’ increasing willingness to negotiate terms now they are facing the impending increases in space available to retailers in the City and HafenCity. In addition, there is a trend to seek smaller shop premises. “Companies are endeavouring to increase their floor efficiency by renting smaller properties,” comments Bechert
. In 2018 retailers focussed on shops no larger than 150 m², which accounted for 42% of rental agreements.
Furniture/furnishings moving onto the market
About 60 new agreements to rent space were concluded, slightly more than a year before (55 leases). However, due to a lack of agreements for more than 2,000 m² of space, the total take-up, at 18,200 m², was slightly less than in 2017 (-2%). Unlike prior years, the biggest customers for new premises in 2018 were not fashion/apparel firms but companies selling furniture/furnishings, which took 25% of the total. The biggest agreement signed by an enterprise in this sector was the H&M Home lease for about 1,000 m² at Mönckebergstrasse 11. Westwing, a furniture and furnishing shop, took a temporary lease at Neuer Wall 72, thus making a big contribution to this industry’s strong presence on the letting market.
Clothing/apparel firm rents biggest shop
Fashion/apparel firms accounted for the next-biggest share of take-up in 2018, but fell below the prior year’s 29% to 23%. The largest amount of shop space rented in 2018 was 1,400 m². This property is located at Mönckebergstrasse 11 and was taken by Arket, a Swedish textiles firm belonging to the H&M portfolio of brands; the shop opened in October. Bonprix, an Otto subsidiary, rented shop space at the same address and plans to open a facility for computer assisted shopping in Spring 2019. An app will do the work of the sales assistant.
Growing range of gastronomy on shopping streets
Eateries are also an important feature of the retail landscape, and their share of space remains unchanged at 18%. Vendors of take-away products added considerably to the vibrancy of the market. In addition to the food courts in malls such as the “Europa Passage” and the “Perle Hamburg”, the range of gastronomic outlets in shopping streets is also expanding. These include new arrivals in the City district in 2018 such as “L’Osteria” (Bleichenbrücke 9-11), “Hans im Glück” (Brandsende 6-10) and “Espresso House” (Alstertor 1 and Kurze Mühren 4).
New shop concepts are changing the market for retail space
As the new shop concept announced by bonprix shows, the retail space market is attracting attention with a variety of new ideas. Another example of this is the previously mentioned temporary lease that Westwing has signed for a shop on Neuer Wall. A minor sensation was caused in the autumn of 2018 when Google, an internet company, took space in the prime location of Grosse Bleichen in order to present its latest smartphone, the “Google Pixel”. “Increasingly, online brands are using pop-up stores to present their goods and increase brand awareness,” says Bechert
, commenting on this trend, adding, “Online trade is playing an ever bigger role and the impact this has on bricks and mortar stores is affecting the existing structure of enterprise in Hamburg. This is forcing both the retailers and the owners of shop premises to adapt to the changing environment.”
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Photo: Christine Prexel