Guiding Lines: Uninterrupted Motion

Shopping is a pleasant pastime, especially enjoyable for women. New brands actively filling up Moscow rouse their interest in shopping even further. By late 2006 Moscow had 1.948 million sqm of retail space, Cushman & Wakefield / Stiles & Riabokobylko reports. Shops within mixed-use complexes account for approximately 10% of the city's total retail space.

Many Moscow residents head to shopping venues by car. They find that convenient. Besides, it is possible to visit several shops in one day. The best sites for placement of shops are along main roads and high streets. Any shopping mall’s concept shows that availability of convenient access routes for motorists gives the project an edge over rivals.

But when starting the car engine a Moscow shopper cannot always rest assured that he will manage to get to his intended destination. This is the case especially if the plan is to visit a shopping center operating on the premises of a building that provides office space as well. When driving up to the shopping building the buyer increasingly often finds all parking spaces occupied.

As a rule, already in the early hours of the morning cars of clerks employed by or business partners of companies renting office space in the building form a dense row along the facade. An attempt to squeeze your car into a tiny lot somewhere in the vicinity can spell trouble. Within the past seven days alone two cars of my friends were towed by the police for illegal parking. In both cases, cars had been parked near shopping malls. One of the cars, the Ford, parked near office and shopping complex Novinsky Passazh “was obstructing car traffic” on the Garden Ring , the road police officer explained. Another friend had been waiting behind the wheel of her Citroen for a parking space to be vacated near the mixed-use complex Smolensky Passazh for about half an hour before she realized that on that day she was not lucky. Despaired of finding a legal parking space she left her car near the building with a view to spend several minutes in her favorite Stockman shop. When she returned to her car carrying a heavy bag what she found on the spot was a ruddy GIBDD (road safety police) lieutenant who with undisguised malice explained where and on what terms she could get her vehicle back.

Each day, approximately 600 cars are towed off for illegal parking across Moscow. The majority of offenders are motorists who park their cars on the Garden Ring. The hottest spots where towing vehicles are active are near shopping centers on Tverskaya and Novy Arbat streets, Smolenskaya Square and at Kursky train station. .

Theoretically, shoppers are offered an alternative – they may use underground parking facilities. In line with existing standards, an underground car park is a compulsory feature for any centrally-located mixed-use development. Real estate consultants at Blackwood have reported that in line with the adopted standards newly built shopping centers situated within the Garden Ring must provide 1 car space per 70 to 80sqm of total space. Beyond the Garden Ring the requirement is one car space per 40 to 50sqm of total area. “But those requirements are non-binding," consultants complain.

A charge for an underground parking space stands at 50 to 100 rubles per hour. The most expensive parking is in Smolensky Passazh. But practice shows that finding a vacant spot in an underground park is hardly easier than outdoors. Motorists approaching an entry to a car park beneath a mall often see the following picture. A regretful parking attendant makes a gesture giving to understand that an attempt to take an advantage of the modern facility has failed.

Consultants at Astera Oncor explain that the majority of car spaces in mixed-use complexes is usually reserved for office tenants. Class A developments are required to provide one car space per 70sqm of rentable space; class B+ buildings are to provide 1 space per 100sqm. Developers whose projects do not meet these requirements may fail to secure satisfactory returns on office space. Under tenancy deals office tenants pay extra $200 to $500 per 1 car space per month. A tenant at a prime shopping and office complex Sheremetievsky on Nikolskaya Street was recently awarded only three car spaces per 500sqm of rented office space, with a monthly charge of $450 per each. The tenant would have gladly rented more spaces, they would not let him. A class A mixed-use under construction at 7-9 Dmitrovka Street (slated to be commissioned in 4Q 2007, with a total area of 14,700sqm, including 9,400sqm of offices) will provide an underground car park for 100 spaces. One does not need to be versed in mathematics to calculate how many spaces will be reserved for shoppers.

Over the past year Moscow has seen several dozens of mixed-use developments combining offices and shopping space. The list of projects being built or planned is impressive, which means that developers are interested in mixed-use construction. Shop rents exceed amounts charged for office space. A centrally-located prime class A office is rented at $760 per 1sqm, VAT and operating costs excluded, on average, Colliers International reports. By way of comparison: shops on the high street Tverskaya, according to Cushman & Wakefield / Stiles & Riabokobylko, last year were rented at $3,752 per 1sqm per year, VAT and operating costs excluded, $2,328 in Kuznetsky Most , $2,138 on Petrovka and $2,633 on Arbat. Office projects with shops on the first two or three floors generate revenues at least thrice as high as buildings fully reserved for office use.

Retailers are hardly delighted about the state of affairs. The problem of accessibility of shops by car is raised increasingly often at property forums and talks between developers and owners. But coming to terms is not always possible as the retail space market remains the landlord's market. Retail zones included in class A office projects are usually intended for expensive brand operators, whose customers are not used to go shopping by bus, trams or metro.

That is why there is no other solution but to decide on one's priority as early as during design stages - either to develop a full-fledged shopping mall or to launch shops as part of an office zone. DTZ Zadelhoff Tie Leung’s research analysts believe that a mixed-use where retail space is filled up with small shops, bank branches, restaurants and beauty parlors - anything, for which office tenants generate the demand and which will attract but a few outsiders – will enjoy a competitive advantage without creating problems arising from the lack of parking space.

As of 1 January 2006 the total length of roads in Moscow stood at 4,699km. The length of highway roads within the city limits stood at 1,320km. The city is short of approximately 300km of roads.

With a retail zone developing as an independent unit the developer has to ponder organization of parking space in real earnest. Or else, showcase windows of posh shops will only reflect the headlights of cars passing by.