Cyprus malls see surge in demand, rents rise

Known clothing store chains and fast-food outlets are now on the waiting list to rent spaces in Cyprus’s shopping malls.

According to recent reports, a third major burger chain is set to join the two well-established ones at one of the capital’s malls, according to Danos International Property Consultants & Valuers.

Meanwhile, in Limassol, there are plans to build not one but two malls in the same area in the eastern part of the city. One of these is the Mall of Limassol, promoted by Atterbury Europe, which also owns the Mall of Cyprus and the Mall of Engomi.

On the other hand, Nicosia Mall is joining forces with the Panteli Group and expanding its operations to the most privileged area in eastern Limassol.

Danos International Property Consultants & Valuers, who gathered the data, notes that the investment cost for each project is expected to exceed €120 million. If both projects go ahead, they will be multi-storey developments with over 100 stores each. In recent years, malls have gained favour with consumers by offering a variety of shops and entertainment options under one roof.

Rental rates in malls and on the high street

The success of malls is also reflected in the surge of prime rental rates for mall units across Cyprus, reaching €70 per square metre compared to €45 before the pandemic. Danos points out that, regarding shops, rental prices in Nicosia range from €20 to €45 per sqm in 2024, up from €15 to €45 per sqm in 2023. In Larnaca, rental rates have increased from €6-€20 per sqm in 2023 to €10-€25 per sqm this year.

In Limassol, rental prices range from €25 to €50 per sqm, up from €20-€45 last year. In Famagusta and Paphos, prices remain at 2023 levels of €10-€25 per sqm. Sales prices for shops in Nicosia seem to have remained at 2023 levels of €4,000-€5,000 per sqm. In Larnaca, sales prices in the first quarter of 2024 increased to €2,500-€3,000 per sqm from €2,000-€2,500 in 2023. Limassol sales prices have stayed at 2023 levels of €5,500-€6,500 per sqm, while in Famagusta and Paphos, they have also remained unchanged at €2,000-€2,500 per sqm.

Concerns about the dominance of shopping centres

From time to time, workers’ unions and shop owners’ associations have expressed concerns about the construction of new shopping centres, arguing that it will fragment the market to their detriment. The prospect of two new shopping centres in Limassol, in such close proximity, has heightened worries in the city. The reality is, according to Danos & Associates, that Cyprus already has one of the highest ratios of shopping centre space per capita in the EU.

It remains to be seen whether any new shopping centres will increase footfall to the malls or simply heighten competition among them without affecting high-street stores.

Danos International Property Consultants & Valuers state that each move certainly requires a thorough examination by local and state authorities and proper direction from specialist consultants. All stakeholders, they conclude, should approach the matter holistically to ensure that entrepreneurship and commerciality in each area progress, rather than simply adding more square footage of retail space.