Install

Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Turks Start Building Retail-Office Center




Turkish company Tobtim International Business Centers Inc. has started construction of a large 35,000-square-meter shopping and office center near Novokuznetskaya metro station to showcase Turkish goods, the complex's agent, Stiles & Riabokobylko, said Wednesday.


"The idea behind it is to build a Turkish trade center, to attract quality Turkish retailers and, of course, attract the retailers already in Moscow," said Natalya Oreshina, retail property consultant at Stiles & Riabokobylko.


Developer Tobtim International Business Centers and builder Ekinciler kicked off construction last week at 8 Sredny Ovichinnikovsky Perulok. Completion is scheduled for July 2001.


The eight floors of the complex will be evenly split between class A office space and retail space, with tenants having the option to buy or lease.


Rent and sale rates are not finalized, although Oreshina said the preference would be to rent.


She declined to say how much would be invested in the complex,


The main anchor tenants are expected to be a 2,000-square-meter supermarket and a department store, and several prospective anchor tenants are already showing strong interest, Oreshina said. The center will have a large food court, an entertainment center and a 180-car underground parking garage. The number of spots for surface parking has not yet been determined.


A mere 200 meters separates the bustling Novokuznetskaya metro from the planned complex.


Officials at Top Team International Business Centers were unavailable Wednesday due to the weeklong Kurban religious holiday.


Some real estate experts said the location is attractive due to the high number of people passing through Novokuznetskaya and the adjoining Tretyakovskaya metro station. Oreshina put the number at 51,300 people a day.


"It's not the high street that Tverskaya is for retail, but Novokuznetskaya obviously has massive footfall volumes every day due to the fact that there are two metros there," said Jack Kelleher, director at Noble Gibbons/Richard Ellis.


"The trick of building a retail element there is to really establish a tenant mix that will pull in that middle-class segment that is passing that point everyday," he said. "If they can bring in the right tenant mix, it obviously will be a win."


While metro traffic may be high, the site has the disadvantage of not being as accessible to motorists as it would have been if it was located on a main highway, said Michael Lange, national director at Jones Lang LaSalle.


"Shopping complexes are traditionally located ideally on main thoroughfares with good visibility and exposure," he said. "It may not appear as favorable as other areas such as those on Arbat and the Detsky Mir area."


Oreshina said the district sorely lacked quality retail outlets, a need the shopping center would fill.


"This area doesn't have a proper retail space," she added. "We have a number of small shops along Bolshaya Polyanka and Pyatnitskaya, but there is no quality shopping center in this area."


On the office side of the project, experts said demand should be strong enough to leave the developer happy even though some 160,000 square meters of top office space is expected to open up in the area in the next 12 to 24 months.


"Some large class A buildings are under tremendous demand from Russian corporates," Kelleher said. "Property prices are down right now at attractive prices ... and demand is high due to the increasing perception of stability in Russia and the high price of oil."


"This [Novokuznetskaya] area is right now buzzing with activity," Lange said.


He said that among the new projects are Tsar's Garden, a three-building complex with an impressive 85,000 square meters of space, Mosenergo with 8,000 square meters, and the recently completed Kadashevskaya Embankment complex. Two Kadashevskaya buildings were recently sold to European companies, leaving open the third 4,500 square meter development.


The flood of space, however, should not overwhelm the market, Lange added.


"Most of these projects are staged in a way there will not be a major overlap" in delivery dates and the type of product being offered, he said.