The optimism gets back to business, – Vadym Iermolaiev says about the state of the commercial rental market in Dnipro city
  10 May 2023

The shopping and entertainment centers have been integral to the everyday life of any city resident for many years already.

We buy food and clothes here. We have a good time here: we go to the cinema, restaurants, and skating. Our children play at the entertainment parks here. How the life of the shopping and entertainment centers in Dnipro city has changed during the major war? We talked to Vadym Iermolaiev, the businessman and investor of the company Alef Estate.

The main thing is security and support for Ukrainian business

The main purpose of Alef Estate since February 2022 has been the provision of security for our visitors, lessees, and employees. We put many efforts to save our high-quality pool of lessees. It was necessary not to lose the visitors and to remain important to them in these new horrible today’s realities for this purpose. Now we can say that our team was able to ensure the operation of our facilities under the conditions of air alarms, blackouts, reduction of limits for electric energy, rotating power cuts, and total reasonable economy. The last winter became a tricky examination for us. But we passed it”, Vadym Iermolaiev says.

And who administered this examination? Surely, they were the entrepreneurs and city people. The key facilities of the Alef Estate commercial real estate lease are still the shopping and entertainment mall MOST city and the multi-purpose complex Cascade Plaza. Their occupancy rate remained almost unchanged despite all difficulties of the last year. However, as Vadym Iermolaiev says, some international marketeers closed their shops in Ukraine at the beginning of the year 2022 for security purposes and did not get back yet.

Surely, this causes losses for us. However, on the contrary, the lack of competition on the part of global giants enables Ukrainian entrepreneurs to improve their indices at these hard times”, Vadym Iermolaiev, the businessman, says.

The number of visitors of the shopping centers was reduced somehow at these times when many residents of Dnipro city moved to the west, and many people went to defense Ukraine with weapon. However, the conversion increased as compared to the pre-war time. So, people started to visit these centers not just for fun but to make certain purchases. So, they do not go from the shopping centre empty-handed usually.

This is not a time for the entertainment

The entertainment field: the cinemas, child centers, ice arenas, etc. suffered much more because of tough times.

“The reasons are quite understandable because there are much fewer children in Ukraine now. And there are fewer new movies as well. But the main problem is an air alarm. People go to the shelter when they hear the danger signal, and hardly anyone comes back after the alarm is over. So, the circumstances are really unfavorable for these particular businesses now. However, we can see an upturn even in their business in 2023, though it is slight yet”, Vadym Iermolaiev says.

Alef Estate discussed individually with each lessee the rental conditions and used the flexible discount system in order to support Ukrainian business.

The Armed Forces of Ukraine give hope for a better future

The first half of 2022 was very tough for the entrepreneurs, Vadym Iermolaiev says, but the situation started to improve little by little in June and July already. And the indices of Alef Estate became much more optimistic in March 2023 already.

“The demand for commercial real estate started to grow. The rental agreements are being concluded now actively, — Vadym Iermolaiev says, — Success of the armed forces of Ukraine impact positively on the mood of the visitors. City people visit the shopping and entertainment malls more actively, and the lessees give more thought of their development when they see the victories of our army”.

The commercial real estate rental market in Dnipro city became more active in the spring of 2023. The lessees are ready to develop and set up new shops or make reconstructions in the existing shops.

“All groups of goods and services are present at our facilities because they are multi-purpose shopping malls. And this is the main principle of their construction and realization. This particular characteristic makes them successful even in the most challenging times. If your shopping and entertainment mall is located in the right place and has a strong pool of lessees, the correct concept, and a professional team, then you will have the top results under any circumstances”, Vadym Iermolaiev says.

The lessees are ready for the development

The rental rates in 2023 except for the children’s goods and entertainment section approach to the level of 2021 step by step. The demand for office space also grows.

“Surely, the necessity of working in the remote mode because of the pandemic and the war-time situation had impacted on the decrease of the offices lease temporarily. However, the advantages of working in the physical office are still important in the context of the stronger team spirit and better productive efficiency of the employees. So, the lessees start to see the value in the physical office particularly. So, the demand on the offices rental market expects the resuming due to the fact that many various funds and international organizations are present in Ukraine now”, Vadym Iermolaiev says.

According to the investor, the development of the rental market depends on the run of events on the front.

“We expect the movement and active appearance of the international companies on our market, as well as the growth of demand for the commercial real estate lease, and this will contribute to the construction of new shopping and entertainment malls”, Vadym Iermolaiev tells.

For reference: The shopping and entertainment mall MOST-city is a gold standard among the shopping and entertainment malls not only in Dnipro city but also in Ukraine. It has been maintaining leadership on the market for 17 years already.

Cascade Plaza is a unique multi-purpose complex located on the Katerynoslavskyi boulevard in the very heart of the city and oriented toward visitors who value their comfort.