In its annual study, the consulting company “Standort + Markt” provides information on how brick-and-mortar retail has developed in Austria’s inner-city locations and shopping centers: While the retail space is declining, the vacancy rate is increasing.
Fashion retail is losing to online retail
Since 2013 location + market has recorded all shop areas in the 20 largest cities in Austria and in 16 selected small towns and thus has a meaningful monitoring of the condition and changes in the Austrian retail landscape. According to this, the Austrian fashion retail trade in the cities is declining, overall the area has decreased by 15 percent in the last eight years. The change is clearer in this industry than in any other. In the previous year alone, sales areas in the fashion and shoe trade had collapsed by two percent. Although the clothing sector still accounts for almost half of the total retail space in city centers – also due to long-term leases – it has lost massively to online trade in the last two years of Corona, according to the authors of the study.
Tourism regions particularly affected by vacancies
Traditionally, Salzburg, Innsbruck and the city of Vienna – all tourist strongholds with a correspondingly high footfall – are at the top of the city comparison. Because of the pandemic, that tide has turned against some city businesses. Since 2020, the number of overnight stays in city tourism has fallen noticeably, which has had a serious impact on inner-city trade. While the increase in the vacancy rate in the center of Vienna was moderate (from 3.4 percent to 4.5 percent), the increase in the vacancy rate in Salzburg was significantly more massive by five percentage points (from 1.6 percent to 6.6 percent). At least Innsbruck should have managed to cushion the downturn in 2021, the vacancy rate is – after a noticeable increase in 2020 – again a good 2.4 percent.
The inner city of Wiener Neustadt remains the greatest challenge in terms of inner-city vacant space: with 29.5 percent vacancy, it takes last place in the current ranking.
Gastronomy and grocery stores take over areas
The vacant shops will primarily be taken over by the food trade and gastronomy. “The vacancy rate in Austrian city centers is currently 7.4 percent,” says Rainer Will, Managing Director of the Retail Association, summarizing an important study result. “All in all, domestic city retail had to cope with a loss of sales space of more than 54,000 square meters in 2021. 90 percent of the town centers and peripheries in the rural regions are not even taken into account. Extrapolated, this results in a loss of retail space of 500,000 square meters or 80 soccer fields.” The vacancy rate in the city centers is slightly higher than in the shopping centers.
The largest gains in area can be seen in Dornbirn, Wiener Landstrasser Hauptstrasse, in Amstetten and in Linz. City centers that have been shaken by crises in recent years with high vacancy and fluctuation rates such as Steyr and Wiener Neustadt were not spared from a total reduction in retail space in 2021 either. With 215,000 square meters of total retail space, Vienna’s Mariahilfer Strasse still tops the list, followed by Wieder City (205,400 square meters), Graz (167,600 square meters), Linz (145,400 square meters) and Innsbruck (115,500 square meters).
Location + Market forecasts a further acceleration of these developments. The end of the state pandemic aid programs will also contribute to this.