Central and Eastern European cities are top of the list for retailers that want to expand into new territories over the next five years, according to an annual survey produced in association with the International Council of Shopping Centres (ICSC).

Moscow topped the rankings in the 2007 International Retailers’ Survey, followed by St Petersburg, Prague, Bratislava and Ljubljana respectively.

The only western European city in the top 10 is Amsterdam, which made joint tenth position with Kiev.
The report, commissioned by Real Estate Publishers (REP) in association with the ICSC and produced by Cushman & Wakefield, found this year’s highest risers were Sofia and Bucharest, both up two places.

REP president and chief executive Marinus Dijkman said: “Central and Eastern Europe, in particular Russia, is still clearly seen as the land of opportunities for many cross-border retailers. At the same time, we are also seeing retailers with their origins in central and Eastern Europe expanding internationally.”

The report also found that 73 per cent of retailers preferred a high street location. In-town shopping centres ranked second, followed by out-of-town shopping schemes.

Of those surveyed, 82 per cent said a direct or organic approach was the preferred method of entry into new markets. 21 per cent said franchises and 20 per cent said via a joint venture with a local partner.

Tallinn offered the best value for money relative to retail space, according to the survey. This was followed by Moscow and Glasgow in joint second position and Budapest, which ranked third.

Respondents felt that online retailers in general were of most threat to their businesses. International retailers they were watching included Russian supermarket giant Pyatyorochka, Marks & Spencer, Ikea, Carrefour, Wal-Mart, Zara and H&M.

Only 28 per cent of international retailers in Europe claim to have a policy on Corporate Social Responsibility, despite the fact that 38 per cent of interviewees believe consumers will increasingly differentiate between those retailers with a CSR policy and those without.

US retailers with European operations are most likely to have a CSR policy and southern European retailers least likely, with social inclusion followed by ethical trading the most common features to be included in a policy.

The survey covered property executives responsible for international expansion at 250 retail companies from 23 countries across Europe.

Top 20 cities targeted by international retailers over the next five years

1 Moscow
2 St Petersburg
3 Prague
4 Bratislava
5 Ljubljana
6 Sofia
7 Bucharest
8 Budapest
9 Tallinn
10 Amsterdam
10 Kiev
12 Berlin
12 Warsaw
14 Zagreb
14 Copenhagen
14 Riga
14 Vilnius
18 Stockholm
19 Split
19 Paris
19 Geneva

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