Factory Outlets in Europe: Curbed Growth

Although factory outlet centers (FOC) have been among the most dynamic retail formats in recent years, only few new factory outlet centers were opened this year or in 2014. These include: "Fashion Outlet Montabaur" (13,900m², DE), "Outlet Village Pulkovo" (23,400m², RU), "Outlet Białystok" (13,300m², PL) as well as an FOC integrated into "Resort World Birmingham" (14,000m², UK). However, a look at the current pipeline suggests that this trend will be changing: around 55 projects are waiting to be opened within the next 4 years, of which approx. a quarter will be expansions to existing centers. In absolute terms, Germany will get the most new FOC space, followed by the United Kingdom, France, and Italy.
Analyzing individual countries according to the amount of FOC space available per resident, one can observe that in those countries which already have a high concentration of FOCs – AT, CH, UK, PT, and IT – this concentration will further increase by some 10 to 30% in the coming years. The top FOC markets are therefore developing in a stable way, but a certain degree of market saturation is becoming visible at the regional level. For example in Portugal, Neinver has cancelled the "Algarve The Style Outlets" project (23, 500m²) near Faro. The "Designer Outlet Algarve" is another project in the same region. The latter is somewhat smaller at 17,000m² and is to be developed together with a shopping center and IKEA furniture store.
In contrast, a considerable increase of FOC space can be expected during the coming years in some smaller countries. This applies to Western European countries like Belgium and Norway as well as to Eastern European ones like the Czech Republic and Slovakia. There is also a project in the pipeline for Ukraine. However, the projects in Ukraine and Slovakia still have a high degree of uncertainty. The first FOCs in Estonia (Gate Outlet Tallinn) and Finland (Zsar Outlet Village) are scheduled to open their doors in 2016.