LONDON, Feb 10 (Reuters) - Russia and Turkey will be among the destinations of choice for international retailers plotting counter-cyclical expansion drives in 2009, an exclusive report obtained by Reuters showed on Tuesday.
Against a rising tide of global economic worry, property services company Jones Lang LaSalle said it expected several of the world's biggest retail brands to take more space throughout southern and eastern Europe this year as new mall openings helped to curb rising rents.
"2009 is set to be a year of opportunity. Deals are likely to be very favourable for tenants even in prime locations, with the best lease terms available for the best brands with strong covenants," said James Dolphin, head of pan-European Retail Agency at Jones Lang LaSalle (JLL).
Retail rents in Istanbul, Warsaw, Prague and Athens were among the fastest-growing in Europe in 2008, an earlier JLL research report, published late last year, showed.
Dolphin said landlords keen to fill their new shopping malls could be persuaded to revise double-digit rental growth expectations to pull in the best brands.
"Western and Southern Europe will become more attractive to North American brands in 2009 and we forecast a range of retailers including Forever 21, Anthropologie, Hollister and Crate & Barrel to take advantage of the favourable deals that will be available," Dolphin said.
Turkey accounted for 11.3 percent of the total cross border movements of retailers over 2007 and 2008. About one tenth of all retailer movements were towards Russia, with Poland, Romania and the Czech Republic rounding off the top five preferred destinations.
The UK was ranked at number seven, accounting for 6.6 percent of retailer movements over this period. This position was partly due to the launch of the Westfield London shopping centre in west London, which lured almost half the number of UK retail market entrants last year, JLL said.
JLL said the opening of some 1 million square metres of Turkish shopping centre space between January 2007 and December 2008, had helped to draw global brands such as Gap, Muji and Banana Republic, Calvin Klein, Chanel and YSL.
It said expansion via both direct and franchise routes had become increasingly common, with Poland, Romania and Russia in particular seeing a notable increase in franchise business launches designed to offset risks in a cooling economic climate.
In Southern Europe, JLL said Portugal remains an important target for international retailers, because of attractive rental values and a modern shopping centre stock. (Reporting by Sinead Cruise; Editing by Andrew Macdonald) (See www.reutersrealestate.com for the global service for real estate professionals from Reuters)