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Nicosia’s battered retail market needs help to survive

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By Panos Danos

The Cyprus government and Nicosia Municipality should collaborate with the retailers and other traders in their efforts to promote the centre of the Cypriot capital and support its local market.

This collaboration should include:

  • Joint advertising initiatives with the use of proper promotional material
  • Joint action with islandwide information stands
  • Promotional events for Christmas, New Year, Easter and the summer 2021 period

Government and Municipality officials should be in close contact with the retailers, restaurant and cafe operators, to plan, meet and exchange views monthly in efforts to confront the extraordinary conditions of the city centre’s market, caused by ongoing public works and the pandemic.

The meetings can also be attended by other local tenants and property owners, police, planners and architects and other members of the property profession to provide for more conclusive results.

Meanwhile, the retail and entertainment operators must have more support measures for businesses affected by the Covid-19 pandemic and the construction – infrastructure works.

The Cyprus government should:

  • Subsidize the existing jobs in the market instead of creating new positions
  • Tenants must be allowed to reduce rent by 40% for more than six months. Property owners should be subsidized/compensated accordingly.
  • Allow further time for current financial obligations to Government, Banks and Municipality to be paid off in at least 48 instalments with a low interest rate.
  • Arrange for loans to be actually provided by banks under special terms for Covid-19-affected companies.

SHOPS

Unfavourable developments in retail and catering are due to the effects of the coronavirus pandemic.

It is a situation that has created a very big problem in the turnovers of the operators. All major retail chains have reduced the number of their stores.

Many of the landlords have realized the urgency of the situation and decided not only not to increase the rents, but even to reduce them.

What is paramount for both parties (landlord and tenant) is survival for 2021.

At this stage, if careful handling and reasonable negotiations are made, the situation can be reversed.

DANOS / BNPPRE predicts that in Commerce, shops will incorporate payment facilities, consumer loans and other services to attract visitors.

Online shopping will develop rapidly and dynamically mainly for the 14-20 age group while shops will continue to attract mainly those who are aged 45 to 55.

This year, in the first 10 months, there was a reduction in consumption of about 30%, compared to 2019. The picture is similar for both main shopping streets and shopping malls.

Retail parks seem to be gaining ground as a destination.

In the “tourist” areas, consumption fell by 55%.

Again, it is vital that tenants and landlords agree on a successful business relationship, within the context of the financial situation and that there is flexibility.

A commonly accepted formula could be: “minimum rent plus a percentage of turnover”.

The writer is CEO of DANOS An Alliance of BNP Paribas Real Estate, member of the Cyprus Valuers board of directors www.danos-group.com