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CORRECTED - Europe mall projects shelved amid downturn-report

Published 04/16/2009, 05:23 AM

(Corrects to add 'million' to conversion figure in lead)

LONDON, April 16 (Reuters) - Up to 7 million square metres (75 million square feet) of planned shopping centres in Europe have been put on hold or cancelled amid the credit crunch, and more could be shelved as the global downturn gets worse, a report said on Thursday. The report from real estate consultancy Cushman & Wakefield said that European mall space will grow at the slowest pace since 2005 over the next two years, with 10 million square metres expected this year and 7 million square metres in 2010, down 40 percent from the firm's forecast in July 2008.

"The downturn in the development market is mainly due to the difficulty in securing finance ... exacerbated by many retailers being cautious in their expansion," Cushman's European retail partner Boris van Haare Heijmeijer said.

Cushman said the bulk of mall space added in the next two years would be in emerging Europe, with 2 million square metres planned for Turkey and 1.25 million square metres for Russia, but it expected some projects would be cancelled as the economic outlook worsens.

The slowdown in growth followed a record year for mall openings in Europe in 2008, when more than 9 million square metres of retail space was built, led by Russia, Turkey, and the United Kingdom, the report said. (Reporting by Daryl Loo; editing by Karen Foster) (See www.reutersrealestate.com for the global service for real estate professionals from Reuters)

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