Almaty is the largest city in Kazakhstan and remains the country’s main business centre despite the capital having moved to Astana in 1997. In fact, Almaty has more than 3 times the number of international companies operating within the city than in Astana.
Almaty has recently been slightly unsettled by the economic and political instability in the region adversely affecting the retail sector. However, However the city still benefits from increasing retail turnover, a low unemployment rate, the highest standard of living in Kazakhstan and a growing population.
With the opening of a number of new shopping malls in the last couple of years and a healthy pipeline of new projects, Almaty is getting closer to saturation point. Almaty’s retail sector comprises a mix of traditional “bazaar”-style markets, western-style shopping malls and a small element of street retail. Consumers are gradually moving away from the shopping at markets and the success of shopping malls indicates a growing consumer demand for this type of retail format. Based on the total international-standard retail stock in the city of 470,000 sq.m and using the estimated population of 2 million the volume of retail space per 1,000 capita stands at only 230 sq.m, compared to 343 sq.m in Moscow and between 400 and 600 sq.m in most other European cities.
Furthermore there is now a strong focus on the construction of new international-standard retail developments through the implementation of the 2020 Master Plan of Almaty (the city’s core town planning document).
TSUM-GOGOL STREET AREA
The TsUM-Gogol Street Area forms part of the Golden Square district, Almaty’s sole concentrated high-street retail zone. TsUM (which translates as “Central Universal Shop”) is the former Soviet department store that now houses a number of international retailers including Marks & Spencer, Zara, GAP and La Senza. Other street retail stores are distributed evenly around the city, particularly along Dostyk Avenue, although this sector remains a relatively minor sector of the retail market in the city.
Barakholka is a huge out-of-town bazaar which covers several hectares. It’s a wholesale market selling a wide range of goods (from clothes to carpets and lamps to refrigerators) mostly of Turkish or Chinese origin. Retailers sell their products from shipping containers which are tightly arranged next to each other in rows.
Opened in 2006, MEGA Alma-Ata is Almaty’s most successful shopping centre favourably located along a major arterial route in a densely-populated residential area of the Bostandyk district. It’s anchored by a Ramstore supermarket and other retailers include Zara, Topshop/Topman, Gap, Mango. On the back of its current success a second phase (MEGA 2) was opened in late-2013, which doubled the total retail space to 81,000 sq. m. (GLA).
A’port is currently the second-largest shopping centre complex in Almaty with a GLA of 63,600 sq. m. It is situated in the suburbs to the West of the city and offers mass-market brands, food & beverage and leisure activities. Tenants include New Yorker, Clarks, Mango and Koton as well as a Ramstore hypermarket, cinema, waterpark and children’s entertainment zone.
Esentai Mall is a brand new shopping centre across 6 floors with a total GLA of 55,000 sq.m. It is home to luxury brands such as Louis Vuitton, Saks Fifth Avenue, Gucci, Prada, Burberry, Moschino, Lacoste, Omega, Polo, Ralph Lauren, Stella McCartney, Tommy Hillfiger, as well as other mid-market retailers like Mango, Promod and Vero Moda.
The Green Bazaar is Almaty’s famous centrally-located, covered market, which predominantly sells fresh food. Bazaars jointly act as both small-scale wholesalers and retailers providing consumers with the lowest prices due to the high levels of footfall and large turnover of stock. The Green Bazaar is renowned for the quality of its fresh food including fruit, vegetables, dried fruit and nuts, dairy produce, meat, fish and bread.
|SHOPPING CENTER TO WATCH OUT FOR|
|Center Name||DOSTYK PLAZA|
|Total Size (Sq.m)|
|- Total GLA||54,000|
|- Leisure/Entertainment GLA||Not available|
|Planned Opening Date||Q3 2014|
|Consumer Profile||Premium and mass market brands|
|Description||Dostyk Plaza is anticipated to be one of the most popular shopping and entertainment centers in Almaty due to its strategic and central location in one of the most prestigious high-income districts of the city. The development will benefit from a “Plaza” street retail area, which will accommodate premium brands, and the mail mall, which will house mass-market retailers, a food court, cinema and other leisure operations. Owing to its advantageous location and proposed tenant mix the footfall is expected to be one of the highest among the existing retail destinations across the city.|
|KEY AREAS / STREETS/SHOPPING CENTERS||CONSUMER PROFILE||MAJOR RETAILERS PRESENT||NEW ENTRANTS||TYPICAL RENT FOR UNIT OF 200 SQM (US$/MONTH/SQM)||RANGE OF UNIT SIZES (SQM)|
|MEGA Alma-Ata (1 & 2)||Mass market||Ramstore supermarket, Karen Millen, Zara, Topshop/Topman, Mango, Gap, Desigual, Bershka, New Yorker, Burger King, KFC, Hardee’s, Costa Coffee||Zara Home, Oysho, F&F, Pepe Jeans, I am, Jack&Jones, Etam, Quicksilver, M.A.C||Information not available||50-4,000|
|A’port||Mass market||Ramstore hypermarket, New Yorker, Mango, Koton, DeFacto, Clarks, Burger King, KFC,||Sketchers, Next entertainment center||Information not available||50-10,000|
|Green Bazaar||Small-scale wholesale||N/A||N/A||Up to $110 (market stalls)||N/A|
|Barakholka||Wholesale||N/A||N/A||$15-50 per container||10-25|
|TsUM-Gogol Street Area||Mass market||Benetton, Sisley, Miss Sixty, Marks & Spencer, Zara, Gap, La Senza, Rolex||N/A||$60-100||30-600|
|Esentai Mall||Luxury/premium and mass market||Saks Fifth Av., Louis Vuitton, Burberry, Gucci, Dior, Koton, Mango, Promod, KinoPark IMAX Cinema||Prada, Porsche Design, Moschino, Next entertainment center||$70-110||50-8,500|
Data as of July 2014
Almaty residents are gradually beginning to adapt to western food habits. International fast food brands such as Burger King, Hardee’s, KFC, and Pizza Hut have only recently entered the market commonly occupying space within the shopping mall complexes.
Visits to restaurants are invariably reserved for a special occasion such as a wedding or birthday and top restaurants tend to be located outside the city centre (along Dostyk Avenue and Navoi Street) where large groups can be more easily accommodated.
Dostyk Avenue, which runs all the way to the mountains to the south of the city, is home to the finest and most expensive restaurants in the city, including Bellagio, Samal, Royal Café within Royal Tulip Hotel, Arman, Donatello and Pamigiano Group. These restaurants tend to be locally-owned and operated.
There are a number of premium cafes/lounge bars in the city that blur the distinction between the drinking and eating sectors. Many are excellent dining options that also serve as popular drinking establishments and include Passione Italiana, Safron, Vertalet, Marrone Rosso, Il Patio, Assorti and El Mirador. Hard Rock Café opened a restaurant and shop in the city in 2014.
Outside the shopping mall complexes, the food and beverage sector is dominated by domestic operators ranging from the high-end restaurants along Dostyk Avenue to the fast-food and take-away outlets across the city.
The coffee shop/café sector is made up of a mixture of domestic operators, such as Coffemania (part of the AB Group) and Madlen, and international brands, such as Gloria Jean’s Coffee and Costa Coffee. The largest concentration of cafes is along Abylai Khan street. A coffee-to-go is still a relatively new concept in Almaty.
|KEY AREAS||CONSUMER PROFILE||FOOD & BEVERAGE OPERATOR INCLUDING||RENT FOR 350 SQM UNIT|
|Dostyk Avenue||High-end/fine dining||Bellagio, Samal, Royal Café within Royal Tulip Hotel, Arman and Donatello||Information not available|
|Shopping Malls (MEGA Alma-Ata, A’port)||Mass market/fast-food||Burger King, Hardee’s, KFC and Pizza Hut||Information not available|
|Central Business District||Mass market/premium cafes and lounge bars||Passione Italiana, Safron, Vertalet, Marrone Rosso, Il Patio, Assorti, El Mirador||Information not available|
Data as of July 2014
Steve BrownGroup Managing Partner, Veritas Brown
CDC 2 Business Centre, 240V Furmanov Street
Almaty, 050059, Kazakhstan
Tel: +7 727 334 4000
Mob: +7 701 266 8482