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Elena Oreshkina: «Commercial property in RC is expected to surge»

Publications 28 September 2018

Marketing, advertising and PR director of GC Coldy delivered a speech in the business program of the autumn exhibition fair “Real Estate from Leaders”.

At the conference “Commercial Property in Residential Complexes”, organized by the Moscow Investors Association, the company’s expert spoke about current realities and trends in the business class segment of the market.

“In 2018, we are witnessing a gradual rise, demand has revived and shifted towards the city center, to convenient locations, which used to be “behind the means” of many. Over the last 4 - 5 years, the average area of purchased and rented commercial premises has decreased: 39 sq.m. (in 2018) instead of 62 sq.m. (in 2014). At the same time, the share of vacant space continues to consistently decrease, – pointed Elena Oreshkina. – Relatively low barrier of entry, 2-3 times faster return on investment compared to residential property and the concept “live-work-rest” will lead to a surge in the commercial property market in 2-4 years”. 

According to Oreshkina, trends and customer requests are changing rapidly. Therefore, commercial spaces should be “flexible” and transformable. An example of effective integration of trends into a single environment is the Coloft complex in the Danilovsky District. The complex will feature a service that will increase response to tenants’ ad campaigns and resident engagement: its own community center with a mobile application for communication and an online poster for local events, fitness studios and cinema halls, an event venue, coworking, presentation and business meeting rooms.

The speaker clarified that retailers would switch to loft project sites. In the central districts of Moscow, they often use for business buildings of Stalin or pre-revolutionary era that do not meet the technical requirements for ceiling height, display window area, load on floors and electrical networks. In residential buildings, there are also restrictions for certain business areas. In lofts, it is important for the developer to control the retail conformity with the project ideology, but the legal status of facilities provides business with great opportunities and a lower cost per square meter. Unlike traditional retail, 90% of commercial premises in lofts are acquired in ownership, rather than rented.

“Business class residential complexes are often located far from main traffic or have a fully fenced territory. Commercial premises in loft complexes have high foot traffic, and project costs grow annually by 15%. Therefore, residents of traditional complexes acquire on average only 10-15% of commercial space. In loft complexes (for example, KleinHouse and Loftec), this figure makes about 50%”, – summed up Oreshkina.