Hungary bans construction of shopping centres

The Hungarian government has agreed to temporarily ban the construction of new shopping centres. In the next three years, building commercial buildings of more than 300 m² will be forbidden. With this measure, the government hopes to strengthen the position of Hungarian retailers.

Defending Hungarian retailers

“The goal is for the structure of retail to take a change for the better”, said government spokesman András Giró-Szász, who claimed that “69% of Hungarian retail is controlled by 1% of all retail enterprises, typically international corporations.” He said that exceptions could be granted by a special committee, but the conditions to be met are still unknown.

 

The Népszabadság newspaper claimed Aldi and Lidl would be the decision's main targets: both continue to grow in Hungary, despite (or owing to) the crisis. Other important foreign players on the Hungarian retail market are British Tesco and French Auchan, who would also be banned from building new hypermarkets.

... but endangering Hungarian builders

Representatives of real estate agents, shopping centres and employers are not too amused with the ban. “An average shopping centre creates 1000 jobs”, says Gergely Árendás of real estate agent Wing. His sector has been in a crisis since the Lehman Brothers bankruptcy of September 2008. Last year, the number of new contracts went down a staggering 37%.

 

Ferenc Dávid, spokesman of VOSZ (the Hungarian association of entrepreneurs and employers) warned that the ban will “deliver a blow to the domestic construction industry”. György Vámos, secretary general of OKSZ (the Hungarian trade association) also warned that the most important victim of the new ban will be the construction companies.

Saturated market

For the Hungarian shoppers, this ban is not necessarily a bad thing: the Hungarian shopping centre market is saturated. There are over twenty malls in Budapest alone, and given the average occupancy rate of 80, there is still a lot of room for expansion within the existing buildings.

 

The difficult relation between Hungarian chains and international corporations is not new: recently the CBA chain announced to be interested in buying the local stores of Cora, Match and Profi – all owned by Belgian group Louis Delhaize – to earn a stronger position against the foreign competition.

 

The Hungarian government has agreed to temporarily ban the construction of new shopping centres. In the next three years, building commercial buildings of more than 300 m² will be forbidden. With this measure, the government hopes to strengthen the position of Hungarian retailers.

Defending Hungarian retailers

“The goal is for the structure of retail to take a change for the better”, said government spokesman András Giró-Szász, who claimed that “69% of Hungarian retail is controlled by 1% of all retail enterprises, typically international corporations.” He said that exceptions could be granted by a special committee, but the conditions to be met are still unknown.

 

The Népszabadság newspaper claimed Aldi and Lidl would be the decision's main targets: both continue to grow in Hungary, despite (or owing to) the crisis. Other important foreign players on the Hungarian retail market are British Tesco and French Auchan, who would also be banned from building new hypermarkets.

... but endangering Hungarian builders

Representatives of real estate agents, shopping centres and employers are not too amused with the ban. “An average shopping centre creates 1000 jobs”, says Gergely Árendás of real estate agent Wing. His sector has been in a crisis since the Lehman Brothers bankruptcy of September 2008. Last year, the number of new contracts went down a staggering 37%.

 

Ferenc Dávid, spokesman of VOSZ (the Hungarian association of entrepreneurs and employers) warned that the ban will “deliver a blow to the domestic construction industry”. György Vámos, secretary general of OKSZ (the Hungarian trade association) also warned that the most important victim of the new ban will be the construction companies.

Saturated market

For the Hungarian shoppers, this ban is not necessarily a bad thing: the Hungarian shopping centre market is saturated. There are over twenty malls in Budapest alone, and given the average occupancy rate of 80, there is still a lot of room for expansion within the existing buildings.

 

The difficult relation between Hungarian chains and international corporations is not new: recently the CBA chain announced to be interested in buying the local stores of Cora, Match and Profi – all owned by Belgian group Louis Delhaize – to earn a stronger position against the foreign competition.

 

Questions or comments? Please feel free to contact the editors


EU and Japan agree in principle on trade deal

20/07/2017

(content provided by EuroCommerce) After more than four years of negotiation, the EU and Japan have reached a political agreement in principle on an Economic Partnership Agreement during Japanese Prime Minister Abe’s visit to Brussels. 

Register for the RetailDetail Day 2017 now

20/07/2017

Starting today, you can register for the annual RetailDetail Day, in Mechelen on 21 September. The widely varied program will bring together reputable retailers and digital innovators.

Ensuring your packaging is not past its prime

18/07/2017

By the end of 2017, almost a quarter of everyone on the planet will be over the age of 50. This represents a huge opportunity for retailers but they must be wise, particularly in regard to their packaging choices, if they want to engage this demographic.

Over 100 exhibitors at Shoptalk Europe

18/07/2017

(advertorial) Shoptalk Europe is the big, new event for retail and ecommerce innovation. It covers the transformational trends, technologies and business models reshaping how consumers discover, shop and buy in an age of digital disruption. 

European consumer remains upbeat

18/07/2017

Research firm GfK’s recent study shows that the European consumer trust keeps growing, but there are vast differences depending on the country.

Reckitt Benckiser evades taxes through the Netherlands

13/07/2017

British Reckitt Benckiser, which owns brands like Durex, Calgon and Nurofen, has evaded hundreds of millions of euros in taxes through the Netherlands according to Oxfam Novib after it studies the company’s financial results.

Back to top