Iberian Peninsula: Full shopping center pipeline despite of economical problems

Despite the economical problems in Spain and in Portugal the shopping center industry feels optimistic: With 1,5 millions sqm GLA planned in shopping centers in Spain and about 1 million sqm in Portugal the pipeline of developers is very well filled.

With a shopping center density of about 250 sqm GLA per 1 000 inhabitants Spain and Portugal are in the European average. A dramatical increase of shopping center space with oversupply is not to be feared. From experience many of the projects will not be completed, last year there were less than 10 projects finished in both countries. In the category of shopping centers with more than 100 000 sqm GLA Spain has already 5 and Portugal 2 objects of this kind.

The rhythm of development of retail real estates in this two countries will be depending also on the general economical progress. After Latvia Spain has the second largest unemployment rate in the European Union (18,9% at the end of 2009). Portugal`s unemployment rate is notable lower but with about 10% still high compared to other European countries. Especially in Spain many workers lost their jobs after the burst of the real estate bubble.

With respect to the purchasing power the two countries do not belong to the richest in the European Union, but they count as shopping paradise in respect of fashion & lifestyle. A Portuguese has about 9 000 Euro per year at his disposal, a Spanish about 12 000. In comparison Austrians dispose of around 18 000 Euro per year.