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According to Moscow officials, the "My Street" program will never end, so the next vector of reconstruction awaits Muscovites in the summer. The baton was picked up by the authorities of St. Petersburg: according to them, the Northern capital needs to increase the number of pedestrian streets and revise the entire urban space.

According to JLL analysts, the completion of the landscaping of the Garden Ring within the framework of the "My Street" program has become one of the landmark events of 2017. In the 2nd quarter of 2017, the expected vacancy growth was noted on the reconstructed sections of the Garden Ring. The ongoing repairs limited access to shops and cafes and reduced the number of visits, and after their completion, there was a decrease in vacancy and an increase in rental rates on certain sections of this highway.

In the summer of 2017, the reconstruction of the northern (from the metro station "Mayakovskaya" to the intersection with Yauza) and southern (from the intersection with Yauza to the metro station "Park Kultury") was carried out sections of the highway. After its completion, the vacancy rate decreased in the 2nd half of the year from 23.1% to 20.1% in the northern part of the ring and from 10.3% to 8.8% in the south. On the site updated a year earlier, the vacancy rate in 2017 changed slightly and amounted to 9.6%. As a result, the average share of vacant premises in the Garden Ring decreased in the 2nd half of 2017 from 12.9% to 11.7%. The returning demand from tenants is also evidenced by the increase in rental rates on the northern section of the Garden Ring, updated this summer. For the 2nd half of the year, rates there increased by 18% and at the beginning of 2018 amount to 65 thousand rubles per sq.m. m per year. The northern section of the Garden Ring is the second largest rental rate among all parts of the highway, but the share of vacant space on it remains the largest, JLL notes. Nevertheless, the company's experts are already observing a decrease in the vacancy rate and predict that this trend will continue in the future.

Anastasia Arkhipova, an analyst at CBRE's Market Research Department, agrees: the completion of the landscaping of the Garden Ring contributed to a reduction in the share of vacant retail premises by 0.5%, and the volume of vacant space at the beginning of 2018 amounted to 20,000 sq. m. In recent years, after the start of the reconstruction process, objects of various profiles have closed on the Garden Ring: banks, restaurants, medical clinics, supermarkets, bookstores, which is caused by a drop in attendance due to lack of parking and constant work," explains Ms. Arkhipova. – Today, tenants began to show active interest in the Garden Ring. These are mainly catering, beauty and health salons, catering facilities (they account for about 60% of available space)».

As noted by Daria Kaneva, Deputy Director of the Department of Management of the NAI Becar, although during the construction work tenants of street retail premises have lost profitability, in general Moscow is becoming more "convenient" from the point of view of pedestrian logistics, which has a positive effect on the traffic of tenants of street retail premises.retail. "For example, due to the implementation of summer playgrounds and verandas on the renovated streets, many operators were able to fully compensate for the inconveniences caused by the construction," the expert explains. "The change in the formats of cafes and supermarkets, traditionally placed in street retail, in the downward direction is mainly due to market trends, and not to the reconstruction of streets."

To be continued.

Text: Ekaterina Reutskaya

Photo: shutterstock