Russia Retail Property Development Summit, 2013
November 27th - 28th , 2013, Moscow, Russia
A new movement is gaining momentum with the construction of new shopping centers burgeoning in Russia, attracting giants, both local and global from retail estate industry to acquire their market share in Russia. In Russia, it is Moscow which is leading due to high demand among the commercial real estate investors with REITs setting trend for outside of the city retail spaces.Noppen’s Russia Retail Property Development Summit provided a platform to real estate developers, regulators, construction companies, architects, solution providers, financial institutes and REITs to discuss projects, future investment, foreign player involvement, design trends and technology updates. The Chairman of the conference for day 1, Mr. Alexander Obukhovsky, Development Director of Retail Department at Knight Frank, opened this event with a welcome speech. He mentioned the speakers and the interesting topics that will be discussed during the day which will highlight the market trends of retail industry in Russia. Ms. Olga Arkhangelskaya, Partner, Head of Real Estate, Transportation, Infrastructure and Government & Public Sector in the CIS at EY was the first presenter of the summit. She highlighted the general outlook of the retail property market in Russia and gave more explanation regarding the growth of Russian retail market, entry of retail spaces, development of new formats, shopping mall attendance, government initiatives etc. The following speaker was Ms. Tatiana Kluchinskaya, National Director, Head of Retail Department at Jones Lang LaSalle. Her presentation was focused on the future of Russian retail vs. European retail. Ms. Kluchinskaya showcased different graphics of comparison in economy, consumption, wealth distribution, retail market, market balance, capital market and geographic breakdown. We can conclude that the future of the Russian retail industry is looking positive. Mr. Enis Oncuoglu, Owner of Öncüoğlu / ACP Architecture gave an interesting presentation regarding the urban integration of big-sized real estate developments to the existing environment. He treated the subject of relation between public spaces and retail centers and held the audience captivated with many pictures of retail surroundings. After the first networking tea break, Mr. Ulf Pettersson, Director of Development and Construction at Amstar Global, shed light on the project pipeline. He talked about the appeal factor for the investors and reasons to invest in Russian retail real estate. Mr. Pettersson also explained more about their projects and how was their experience regarding the financing, construction and leasing. Next, a panel discussion which was moderated by Mr. Ilya Shuravin, Head of Retail Real Estate Department, Partner, Board Member at S.A. Ricci. The panelists were Ms. Marina Isaeva, Senior Manager of Development at Auchan Russia, Ms. Maria Shulutko, Project Manager at HALS-Development, Ms. Julia Dalnova, Director of Commercial Real Estate Management at MD Group and Ms. Viktoria Tupikova, Director of Operations at Hermitage Construction & Management Group. The panel participants discussed several topics such as: requirements from retail chains to the developers; trends, demands and challenges that construction companies have to keep up with; importance of need of innovation; common and hidden pitfalls during construction projects etc. Hereafter, next on stage was Mr. Andrew Obraztsov, VRF Product Manager at Panasonic. He highlighted the importance of innovation and quality in their products and specified the heating and cooling equipment that the company produces. Mr. Obraztsov also showed some examples of their existing projects. The following presentation was given by Mr. Brendon O’ Reilly, Managing Director / Member of the Management Board at Fashion House Group. He spoke about the outlet centers and how they differentiate themselves from the shopping centers. The outlet centers are gaining more popularity. Fashion House Group has already outlets in Poland, Romania and Russia. Furthermore, Mr. O’Reilly talked about the management structure and shared other interesting outlet information. Ms. Natalia Skachkova, Deputy Sales Director of Facilicom gave speech on how to operate a retail property in Russia. She treated the subjects like marketing efforts and when and how to maintain success in operating; best repair and maintenance practices; improving strategic cost control measures; opting timely overhaul or face over: criteria and seeking investment. Mr. Antoni Gascon, General Manager of Outlet Village Belaya Dacha was the next presenter. He gave more details about the outlet concept and spoke moreover on how to attract both the brands and the customers. Mr. Gascon also shared their new projects: Outlet Village Pulkovo and Outlet Village Kievsky, which will be opened in 2015 in Moscow and St-Petersburg. Post lunch, the audience welcomed on stage Mr. Denis Stenko, Director of Business Development and Retail Chain Management at Inventive Retail Group (re:Store, Lego, Sony Centre, Samsung, Nike). He focused on the regional development of single-brand chains, the problems and solutions. In the panel discussion that followed, Mr. Alexander Obukhovsky, Development Director of Retail Department at Knight Frank, was the moderator and Ms. Olga Fedorchenko, Deputy Director of Wholesale & Franchising Department at BAON, Ms. Svetlana Lukonina, Development Director at SELA and Mr. Denis Stenko, Director of Business Development and Retail Chain Management at Inventive Retail Group were the panelists. The discussion was regarding the brand expansion in Russia and the development plans of the brands. They also spoke on working with brands’ franchise partners. What they are looking at when choosing shopping mall or a certain city/region. Last session of the day was another informative panel discussion with the moderator Mr. Anton Sorokin, President of TVO Russia and the panelists such as Mr. Rinat Shaipov, Director of Legal Department at PGP Development, Mr. Maxim Kuznechenkov, Partner at Baker & McKenzie, Ms. Leila Urazbaeva, Senior Banker at EBRD and Mr. Viacheslav Romanov, Head of Internal Research at Bank of Moscow. The Chairman, Mr. Alexander Obukhovsky gave hereafter short closing remarks and thanked everyone for attending. The second day of Russia Retail Property Development Summit started with the opening speech of the Chairman of day 2 Ms. Elena Shevchuk, Vice President for Commercial Real Estate / Partner at GVA Sawyer. She welcomed the attending delegates to enjoy the sessions treated during that day. Mr. Guillaume Sadoux, Partner at Bird's Eye View gave the opening presentation by speaking about how important it is to know the consumers’ trends to be able to strenghten your project and design and ways to deal with the relation between mobile purhcase and store visit. He also spoke on the expactations of the Russian shopper and the “High Appeal Factor” for consumers, retailers and tenants? To conclude, Mr. Sadoux could say that ‘Community Place’ is a term that needs to be taken into account. The following presenter was Mr. Maxim Karbasnikoff, Partner, Head of Retail Services at Cushman & Wakefield. He spoke enthusiastically about the retailers’ activities and forecasting tendencies. He could conclude that Russians do spend on retail consumption, but do it wisely and they do visit frequently shopping centers. What also is striking is the fact that luxury brands and discounters outperform. In short, Russian market remains attractive. Hereafter, Mr. Dmitry Burlov, Managing Director at Magazin Magazinov gave an overview of the international brands that are developing in Russia. What is catching the eye is that the international brands are more and more interested to expand in other Russian cities of 500,000 to 1,000,000 people. In many cities, the shopping malls are becoming more attractive than street retail, except for the luxury brands, which still prefer streets. Post tea break, Mr. Raymond Fadel, Director Russia at Aecom presented the projects they were involved in, being responsible for project, design, cost and constrcution management etc., Mr. Fadel drew attention mainly on how to save costs via effective project planning and delivery. Mr. Maxim Arinich, Marketing and Leasing Director at PGP Development enlightened the audience with the company’s experiences and especially with their project of Zelenopark. He gave an in-depth explanation about the location, access, architecture, and concept and showed the visualization of the shopping mall and the zones of leisure and entertainment. Mr. Arinich explained the best ways to attract retailers to the SECs. Next the participants listened to the presentation of Mr. Arnaud Trousset, Owner and General Director of Retail Intelligence Location Solutions. He outlined the food retail market in Russia and the development perspectives. Moreover, he showed different graphics of consumer trends, top food retailers, consolidation outlook and future market growth. Post lunch, the attendees gathered to follow the panel discussion moderated by Mr. Raymond Fadel, Director Russia at Aecom. Together with the panelists who were Ms. Galina Smirnova, Art Director at DeViz, Mr. Nikita Struev, Chief Architect at ARCH3 and Ms. Olga Tumanova, Marketing and Leasing Manager at PGP Development, they discussed the design and architecture of shopping centers in Russia. They talked about the challenges, geographical differences across regions, trends, expectations, must haves, financial requirements and marketing aspect, basically, importance on all crucial aspects when designing a shopping property project. After a short networking tea break, Ms. Julia Merova, Deputy Director of the Brokerage Department / Retail Division at GVA Sawyer gave a presentation concerning tenants and buyers in the shopping center and a vital factor for owner. The closing session of the conference was the panel discussion on the future of Russia’s retail property market during which the following subjects were touched: attracting the investors, owners and developers, putting Russia on the global map, defining risks that need urgent addressing to guarantee sustained expansion, weighing opportunities for creative innovation and building long term overseas confidence in Russia as a brand. The conversation of these topics was among the moderator Ms. Elena Shevchuk, Vice President for Commercial Real Estate / Partner at GVA Sawyer and the following panelists: Mr. Alexey Filimonov, Managing Director at ASTERA, Mr. Vyacheslav Kaminsky, President at DVI Group, Mr. Dmitriy Iovlev, Studio Director at ARCH3, Ms. Natalia Khramogina, CIS Real Estate Head at Citibank and Ms. Olga Tumanova, Marketing and Leasing Manager at PGP Development. The second day Chairman Ms. Elena Shevchuk closed the conference. We would also like to extend our gratitude to all delegates for their active participation. Their questions spoke to the heart of the main issues facing the Russia retail real estate industry. Noppen would like to express a special thanks to the sponsors of Russia Retail Property Development Summit: Panasonic and Wolf for their contributions in this event.
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