The number of Turkish people who shop at outlet centers increases by 30% annually, though outlets comprise only 10% of the shopping space in the country. Developers plan to add two more major outlet centers in the next two years, and some are adding hotel elements to their projects Turkish Daily News.

The complete article of the Turkish Daily News :

Demand for cheaper goods leads investors to play outlet card

Monday, October 8, 2007

Demand for outlet stores where defective or odd lot goods are sold at lower prices is on the rise. The number of outlets is expected to reach 30 by the end of 2009. Recently, investors started to include hotels in their outlet projects.

SEVDA YÜZBAŞIOĞLU ISTANBUL – Referans

Outlet centers, whose number is rapidly increasing not only out of town but also in cities, are nowadays very popular among investors. The number of outlet stores around Turkey is expected to increase from 18 to 30 by the end of 2009 while investors who want to develop the sector of shopping tourism are including hotels in their projects.

Turkish consumers want to buy cheaper goods any time of the year and the demand for outlet stores is on the rise. Firms that are able to see the increasing demand for the outlets are taking important steps to differentiate outlet shopping. One of these steps taken is the outlet hotels that aims to converge the tourism and the retail sectors.

Outlet hotels are very commonplace in the United States and increase the time spent and service received in outlet centers: Consumers can have the option of integrating shopping with an alternative holiday. In the U.S., average consumption per capita in a normal shopping mall is around $47, while the number increases to $240 in outlet centers. Retail sector experts said that Turkey’s high potential to develop this system can create a synergy.

Istanbul Pendik Via Port and Bayrampaşa Outlet are among the projects that are currently under construction. Ulusoy, which has been the focus of interest in Susurluk since the day it opened last year, is planning to include a hotel in its complex. Varan, which is getting ready for opening its outlet center, is also to include a hotel in the project.

Avi Alkaş is one of the leading experts of the retail sector. He finds these developments very positive for the sector and said that it is important to organize tours enabling the consumers to shop around outlet centers and supporting the retail sector with tourism. “People spend more time while shopping in places away from their houses, so they spend more money. We have future projects to organize three to four day tours to outlet centers. Hotels can support these projects,” Alkaş said.

Outlet centers, with around 250,000 square meters rental area, currently account for 10 percent of the total shopping center areas in Turkey. The number of visitors of the outlet centers, which employ between 500 and 2000 people, increase by 30 percent every year.

Bayraktar Holding opened Turkey’s first outlet center in İzmit in 1997. The expected turnout for the center is around $120 million. Bayraktar Real Estate Dealing and Investment Expert Can Akbaş said their center was employing 850 people and the number of visitors was increasing by 40 percent every year. “Every year more than 6 million people visit our center. Approximately 38 percent of these people are from Istanbul. As Bayraktar Group we’re looking for new, easy-to-access places close to metropolitan cities,” Akbaş said.

Istanbul Olivium Outlet Center is another popular outlet center. Expected turnout for Olivium for the year 2007 is around $160 million. Emintaş Construction and Textile Company is to undertake new investments to increase the number of brands in Olivium from 138 to 400. “Increasing demand of the firms led us to open up a second Olivium in Ümraniye. The foundations of the 160-store capacity new Olivium building will be laid in December. The Center will start operating in September 2007 and will cost around $50 million,” said Olivium Outlet Center Director General Murat İzci.

İzci also added that the shopping habits are changing in Turkey. “People no more buy what they don’t need. Credit cards don’t allow installment payments as easy as before. If they want to wear branded clothes without paying too much money here they can find what they are looking for, İzci said. “Hotels and outlet centers are closely related with each other because they both appeal to the same clients. There is still a gap between the two,” he added.

Ulusoy Susurluk Outlet Center, located on the Balıkesir-İzmir Highway, is still enjoying the demand of its customers. There are many food stores and cafes like Starbucks, İskenderoğlu Kebab and Özsüt in addition to the 34 outlet stores in Ulusoy Susurluk Outlet Center. During summer, 14,000 people visit the center daily.

Ulusoy Director General Mustafa Yıldırım said the interest on Ulusoy Susurluk, which was opened in 2006, encourages them to undertake new projects. “Currently our visitors are unable to find a spot to leave their cars in the 120,000 square meters area of Ulusoy Susurluk. We had such dreams when we started this business but we were not expecting our dreams to come true with such a speed. The number of the visitors fall down to 5,000 in winter but the companies are not closing their stores,” Yıldırım said. He underlined that a considerable demand is coming from firms.

“If you start the outlet business in the right place at the right time, your business becomes a brand name. Ulusoy Susurluk Outlet Park is an example,” Yıldırım added.

He said that Ulusoy closed its facility in Hendek and is planning to open one or two outlet centers where the Mount Bolu Tunnel starts. “We made an offer to the General Directorate of Highways. Everyday 85,000 vehicles pass over that spot. We are planning to make use of this place. One of the centers will sell local goods and products. The project will also include a hotel so we’ll be able to support tourism,” said Yıldırım.

Directors of Beylikdüzü Istanbul Outlet Park are also having talks with the investors for a 260-person capacity hotel to be opened within the center. Istanbul Outlet Park Operations Manager Özay Özyurt said they decided to leave room for a four star hotel and they would prefer a famous brand hotel. “We’re going to introduce Turkey with a practice that is already common in abroad. So the customers will be able to enjoy cheaper shopping in a comfortable environment,” said Özyurt. He also added that is company is an expert of retail but not tourism. “We’re open to an agreement,” he said.

Ulusoy’s opponent Varan is also heading for outlet investment. Varan generally focuses on food quality in their accommodation facilities and wants to complete the concept. In order to do so Varan opened a discount shopping center on İzmir-Balıkesir highway. Varan Accommodation Facilities Director General Alp Gürdil pointed out that the interest on Varan outlets is more than they expected. “Currently we have nine units, two of which are for food. We have an idea about Afyon. We can make use of the synergy emerging out of the convergence of hotels and outlets,” Gürdil said.

Existing Outlets:

Istanbul: Olivium, Colony, Istanbul Outlet Park, Deposite Outlet Center, Başak Outlet Center.

Ankara: Optimum, FTZ, Millennium

Antalya: Deepo

Balıkesir: Susurluk Ulusoy Outlet Center

Bursa: Magazin Outlet Center

Çorlu: Avantaj

İzmir: Park Bornova Outlet Center, Selway, EGS Outlet

Aydın: Söke Outlet

İzmit: İzmit Outlet Center, Dolphin Outlet Center

Konya: Truva Outlet

To-be-opened:

Dudullu Outlet: Dudullu 2006-2009

Olivium second phase: Ümraniye 2009

Altınyıldız Project: Merter 2007

Armonium: Sefaköy 2007

Bayrampaşa Outlet: Bayrampaşa 2008

Deepo II: Haramidere 2008

Olivium II: Ümraniye 2008

Cevahir Anatolian side: Date to be announced

Projects in Anatolia:

Safranbolu: Safran Outlet

Optimum second phase: Ankara

Afyon Outlet: Afyon

Denizli Outlet: Denizli

Source: Alkaş Danışmanlık