New malls under construction, office rents paid in Turkish Lira

ISTANBUL

According to JLL Turkey’s Commercial Real Estate Market Overview, which looks closer to the first half of 2018, the shopping malls under construction will open in the second half of 2018 and in 2019.

Currently, 411 malls are currently active across Turkey. The number of the ones under construction is 43. While the vacancy rate in the office market is regressing, there is a 31 percent increase in the number of foreign visitors in Turkey within the first five months of 2018.

According to JLL research, the number of malls in Istanbul is currently 118 and the ones under construction is 18 in the mega city. Most of them will open in the second half of this year and the others are set to open in 2019.

In Ankara, 39 malls are currently open and nine new ones are under construction.

It is expected that the number of malls across Turkey will increase to 454 by the end of 2021. It is reported that a new era will begin in the retail sector with the “specialized” malls, set to open in the second half of 2018.

Retail market to become diversified

According to the report, retailers with strong cash have desire to open new stores while it is seen that electronic markets, which closed down their unprofitable branches over the last two years, returned to the malls.

It is also expected an increase in the number of arts and sports schools, which draw considerable number of people to the malls but are approached with caution by investors.

On the other hand, it is foreseen that the retail market will be diversified as retail field is focused in train / bus terminals, sport stadiums, universities and A-class office buildings.

Vacancy rate in office to fall

According to the figures in A-class office market, the vacancy rate fall from 21.9 percent to 20.9 percent in comparison to the second quarter of the previous year.

In the first half of 2018, the A-class office stock in Istanbul increased by 482,500 square meters compared to the previous year. Ataşehir and Kozyatağı on the Anatolian side and Levent on the European side were on the foreground in terms of renting operations.

One of the most important changes seen in the Istanbul office market is the rental contracts starting to be made in Turkish Liras.

According to JLL experts, the mobility in the office market is created by the reduction of the operations and the number of employees in the companies as well as their requests to increase productivity (square-meter per person) and reduce the rents.

It is foreseen that the ready offices, which provide solutions to big companies that need satellite offices will maintain their importance in the second half of the year, too.

Foreign visitors increased by 31 percent

Recovery signals in tourism reflect credit upon the figures in the JLL research. The number of foreign visitors in Turkey increased by 31 percent (11.5 million) compared to the previous year. The number of foreign passengers landing at the Istanbul Atatürk Airport and Sabiha Gökçen Airport was 40.4 percent in the first half of the year. The occupancy rate in hotels reached 65 percent with an increase of 17 percent.

According to the JLL report, there is an observable decrease in the rental operations in the logistics market in the first half of the year. It is reported that demand for sales was more than demand for renting in the same period.

Sakarya, Düzce, Çatalca and Silivri were reported to be the emerging logistic areas. It is also reported that after entering the Turkish market, the e-trade giants like Alibaba and Amazon will make contribution to the revival of the sector especially if they invest in logistic centers.