Will there be demand for a million square meters? Developers are building shopping centers despite the risks of half-empty space

Various developers have announced the opening of at least 20 shopping and entertainment centers (SECs) by 2025. More than half of them are located in the central and western regions – Ternopil, Khmelnytsky, Ivano-Frankivsk, and Chernivtsi. Also, the opening of shopping malls in Kyiv, Kyiv region, Odesa and Zaporizhzhia has been announced.

According to data from of the Ukrainian Council of Shopping Centers, there are 311 shopping malls in Ukraine with a total area of 9 million square meters. Of which 6 million is leasable area. The most saturated region in terms of the number of retail space per 1000 population is Kyiv region. It is followed by Cherkasy, Odesa, Chernivtsi and Lviv.

What is happening in the retail real estate market now? How many shopping centers can actually open? What is the situation with retail space vacancy? Will rents rise? And are there more Ukrainian brands in shopping malls?

Maxim Gavryushin, chairman of the Ukrainian Council of Shopping Centers and chief operating officer of the Budhouse Group development company, spoke about all this in an interview with LIGA.net.

Given the number of shopping malls under construction, is there really a shortage of retail space in Ukraine? What is the current market situation?

Despite the war, shopping malls are actively being built in Ukraine. If we talk about the facilities that were launched or resumed after 2022, we are currently talking about 56 shopping malls – almost a million square meters of new retail space. And this is without taking into account those projects that were launched before the full-scale invasion but are still frozen.

This is a significant amount. Especially considering that there were years when no new shopping malls were commissioned. For example, in 2017 and 2020 there were almost no new facilities.

In 2025, it is planned to commission about 250 thousand square meters of retail space – 14 new shopping centers. Another 280-290 thousand square meters are expected in 2026.

In which regions is the largest number of shopping centers currently under construction?

The greatest activity is observed in western and central Ukraine. These include Uzhhorod, Mukachevo, and Kamianets-Podilskyi. Three new shopping centers are currently under construction in Khmelnytskyi, and they are scheduled to be commissioned in 2025-2026.

Construction is also underway in Odesa and Poltava. Two large Epicentr retail and entertainment centers are under construction in Kyiv region.

There is also activity in Kyiv itself. In 2024, only a limited number of facilities were commissioned, mostly the second stages of existing centers. Many projects planned for 2024 were postponed. Therefore, the bulk of new space is expected to be commissioned in 2025.