The Numbers
Moscow and its estimated 12.2 million people are the center of life in Russian government, culture, finance and commerce.
The largest city on the European continent, it’s the 11th most populated in the world and the ninth most expensive, with one of the world’s largest urban economies.
Moscow blossomed as a luxury consumer goods center after the fall of the Soviet Union in 1991, and was thriving until the global recession, when a drop in oil prices and international sanctions imposed in 2014 combined to slow the city’s dizzying growth.
The Pulse
Muscovites flock to international luxury brands along trendy thoroughfares like Tretyakovsky Proyezd, Petrovka Street and Kuznetsky Most.
But weather is always a factor in Moscow, especially during winter. So the city is full of enclosed malls, most of them near its expanding metro system. Many large malls, like the new Riviera Shopping and Entertainment Center (shown) on busy Third Ring Road, are built in abandoned factory buildings.
The Hot Spots
TsUM (the Central Universal Department Store), a six-story historical Gothic Revival-style building on Petrovka Street at Theatre Square in central Moscow, is one of the city’s trendiest destinations. Onur Edes, senior project manager at 5+ Design in Los Angeles, compares it to Galeries Lafayette in Paris.
“TsUM covers a floor area of 645,000 square feet,” says Edes, who lived in Russia for 12 years. “And you’ll find them all – Gucci, Valentino, Versace, Jimmy Choo and Balenciaga.”
The new Riviera complex, designed by 5+ Design, has more mid-market selections, aimed at the city’s vast middle class. Its roughly 360 shops and 20 restaurants include tenants like Massimo Dutti, Bershka, Pull&Bear, Zara Home, House, H&M, Decathlon and Guess, and the anchor hypermarket Auchan – plus a nine-screen cinema and a KidBurg “edutainment” center.
Riviera is situated along the Moskva River, which “of all the amazing landmarks in the city, the river is the most meaningful,” says Tim Magill, design partner, 5+ Design. “It serpentines through the center of the city, and its banks and bridges are a big part of the psyche of the city.”
Obstacles and Opportunities
While current retail vacancy rates are slim – about 9 to 10 percent in both high street corridors and regional malls – LA-based CBRE Group Inc., one of the world’s largest commercial real estate services firm, reports that new development will add more than 4 million square feet of commercial property by 2017.
Whether it’s luxury shopping at Vremena Goda (“Four Seasons”), on the busy, high-end residential Kutuzovsky Prospekt – where Chanel, Cartier, Lacoste, Hermès, Montblanc and Burberry can also be found – or at the more mid-market, Western-style, 60,000-acre Metropolis Shopping Centre on Leningradskoye Highway, there seems to be a constant demand for new retail. But, as whenever demand outstrips supply, the costs of entry are high.