Retail parks continue to grow in Spain. Savills' annual study on Medium-Scale Retail in Spain highlights that retail parks play a key role in the development of retail real estate. Currently, the country is home to 132 retail parks with a total Gross Lettable Area (GLA) of 3.4 million square metres. Thirty-three new parks are expected to be added between 2024 and 2025, 11 of which are scheduled to open in 2024, adding more than 120,000 square metres of GLA by the end of the year. With these additions, the number of parks will account for 21% of total assets, while in terms of floor space, they will constitute 20% of total GLA in 2024, up from 15% ten years ago.
Retail parks have evolved significantly in terms of design and retail offer, including a wide range of activities and shops ranging from technology, home, DIY and sports to restaurants, cinemas, and children's entertainment, as well as shoe, craft and pet shops. In addition, the presence of supermarkets has increased, which has significantly improved the perception of the retail park format, making it more similar to a traditional shopping centre.
Changes in consumer habits have motivated the location of these parks in areas with high population density and the reduction of the average size of these establishments from 28,000 square metres to 18,300 square metres in the last five years.
Since 2020, more than 110 new mid-market stores have opened, with operators such as Kik, Lidl, Action, Jysk and Kiabi actively seeking new locations. Emerging brands such as Planet Fitness, Speed Park and Fútbol Emotion, as well as European operators specialising in low-cost products such as Zeeman, Centrakor, Action, Normal, TK Maxx or Half Price, and leisure operators such as Ilusiona, Speed Park or Sould Park, have shown a clear interest in this format.
Investment driver
In terms of rents, average rents for retail parks in Spain are around 10€/sqm/month, reaching 18€/sqm/month in prime parks. New developments present rental values varying between 9 and 11 euros per square metre per month in urban parks and between 7 and 9 euros per square metre per month in other parks.
During the first nine months of 2024, the sector has attracted investments of more than 130 million euros, with expectations of more than 200 million euros by the end of the year. Yields on prime assets stabilised due to lower interest rates, reaching a gross return of approximately 6.25%, 75 basis points above the 2023 level. In secondary assets, yields ranged between 7% and 8%.
