According to the Association of Shopping Centers of Guatemala (Acecogua), the sector registered more than US$158 million in investment during 2023 in the country, as well as the opening of more than 70 thousand profitable square meters of commercial space.
In addition, it reports a 20% growth in the turnover of businesses located in these spaces compared to the previous year, according to preliminary data.
The growth with new shopping centers and plazas or the expansion of existing ones has been registered not only in the capital and in the municipalities of the department; There is also a high momentum in the interior of the country, in the departmental capitals.
In the province there is a boom in areas such as the so-called intermediate cities and other municipalities, explains José Fernández, president of Francorp for Latin America.
Fernández explains that this trend is good and is due not only to the increase in demand and commerce, but also that historically businesses have been concentrated in the metropolitan area and there are places that could already be saturated or already covered and among other options investors They see opportunities in the province.
This expansion also has to do in terms of production and population growth and could be related to intermediate cities and development poles that are becoming more urban and with this the brands are growing towards these areas.
The growth is in various models, both in mall models, large-area shopping centers, shopping plazas and convenience plazas, the latter two with 1 or 2-story formats, he says.
Apart from the metropolitan area, a greater presence is observed in Quetzaltenango, Escuintla, Cobán and its surroundings in Alta Verapaz, Huehuetenango, Chimaltenango and others such as Suchitepéquez, Izabal, Petén.
Large-scale shopping centers continue to be very important, they involve more investment, but also for around 10 years there has been another trend and businesses began to adapt to premises with fewer square meters, for example, between 70 and 100 square meters and, They even now offer commercial and convenience plazas with spaces between 50 and 60 square meters, according to the Francorp manager.
Meanwhile, Sarah Alzugaray, Broker Owne of the Alzugaray Real Estate firm, said that shopping malls have grown a lot inside and the majority of investors are looking for flat land at the entrances or exits of all the large apartments.
What they do is a convenience center, that is, a mix combined with a percentage of convenience stores such as pharmacies, laundry, beauty salons, and some stores.
Experience centers
“In Guatemala, and in general shopping centers in Latin America, present an activity of great dynamism and growth, and I believe that shopping centers have learned to adapt quickly to the changes that consumption patterns themselves have evolved,” there was a certain decline in the number of visitors due to the pandemic, but they have adapted to offering other types of experiences to attract the public and they have been recovering, Fernández explained.
The shopping center has become a space not only as a shopping or commerce destination, but it has a greater gastronomic offer, they are also spaces for distraction, meetings, and recreation, and they have the effect of a social unifier, that is, people also as a walk on the weekends.
The 10 points to take into account
Various aspects must be analyzed to set up a business in a shopping center, according to the explanations given by experts in the field of franchising such as Fernández, and real estate such as Alzugaray.
- Decisions may depend on the location of the place and the type of market the shopping center or plaza is aimed at.
- They also depend on the type of business you have and which must be analyzed if it corresponds to that market.
- The relationship between the cost per square meter of premises rent and maintenance, as well as the projection of the business income statement.
- The rent varies depending on the location and type of shopping center or plaza, purchasing power, size, type of premises and place where it is located within the shopping center, and that each firm or venue has its metrics.
- The rent factor is one of the key considerations that determines whether a location is viable or not for the business, and that will depend on how much rent can be paid and how much it can generate income in relation to the traffic potential it has. of people.
- Shopping centers or plazas work on the basis of one or several anchor businesses, for example, supermarkets that by nature have automatic traffic that generate a lot of traffic, also the presence of large brands of different types of products and make a combined mix with a percentage of convenience and gastronomy stores.
- In shopping centers, the traffic or influx of people is normally on weekends, so the businesses that set up shop in the place have to make their projection for their monthly income flow based on the weekends, and the Most businesses depend on these to break even.
- The movement in the place also depends on the proximity or distance of the holidays from the weekend.
- The cost per square meter is higher in small stores than in large ones, and the impact of costs is relative because what matters is the type of business and the demand for the product or business.
- It can be a small store, but with a product in constant high demand throughout the year, or a seasonal product, but for which the publicity generated by maintaining a presence is important, explains the executive.
Alzugaray, who has more than 30 years of experience in real estate, commented that the Montufar shopping center began in Guatemala City, just as the installation of these facilities is beginning in the apartments, where there has never been such an offer.
He explained that the one that first began to go inland was Grupo CMI with Centros Comerciales Pradera, but now other developers are making their way who are betting on other models of shopping centers in the apartments, because they are seeing that there are very good sales. “People concentrate more and spend more when there is a meeting point” and that is why the development of these venues also includes gastronomy, food areas and convenience stores to attract more traffic and permanence.
In the behavior that has been taken, it must be taken into account that in the real estate market there is always a before and after elections, since during the elections it stops almost completely and once again gains a very strong boom after this and “of “In fact, now all real estate investments have skyrocketed again,” he added.
Prices
The rental prices for the premises are variable, depending on the format of the shopping center, the chain or network to which they belong, the location of the premises and the location of the premises. Alzugaray provided these examples:
- Maintenance fees range from US$2 to US$5 per square meter on average.
- In some high-traffic shopping centers, rent prices are US$35 per square meter, plus maintenance.
- A square in zone 14 was around US$22 to US$25 per square meter, plus maintenance.
- In the middle it is mentioned that the rental value in small squares is around US$12 to US$15 per square meter.
- Large premises have a lower rate per square meter than smaller ones.
- Yes, it is small, but they know that it will have the same positive impact and because of the traffic it will acquire, they will raise the price per square meter.
- The price per square meter for a commercial space in the food court is higher than on another floor, adds Fernández.
- The way of charging in shopping centers has been evolving and some in Guatemala already use the so-called mixed factor or rent model, which is the charging of the cost per square meter as a base, plus a percentage or multiple for local sales. he explained.
Franchises
The Francorp manager mentioned the relationship between franchises and shopping centers or plazas.
“Shopping malls and plazas are always the number one ally of franchises” for two reasons: these venues like these franchise businesses because they convey a consistent value proposition, since they are not interested in businesses that open and close shortly after. , because there is nothing worse than an empty or closed premises.
And, for that same reason, for many shopping centers, their first option is to work with chains, because they are established, they have brand power, because the customer experience is proven and has consistency, and that helps increase the probability of success, and this includes franchises.
Regarding rent, it was added that large brands, such as franchises, can negotiate the price, taking into account the shopping center’s interest in businesses of this type and the recognition they establish.
Some projects
Acecogua mentions that in 2023 the first stone will be laid in Metroplaza Salcajá, Metroplaza Jalapa and the launch of Plaza Vidú and the inauguration of four inaugurations of plazas and shopping centers such as Oakland Place and Plaza Nogales in the capital, as well as Los Altos in Totonicapán , Plaza Telares in Antigua and the expansion of Plaza Américas in Mazatenango.
Information collected about other chains indicates a high presence in various areas:
In the case of Pradera, which is part of CMI, in December 2023 it reported that it has 13 shopping centers, 9 of which are located in the main departmental capitals. They mention presence in Chimaltenango, Chiquimula, Escuintla, Huehuetenango, Puerto Barrios, Quetzaltenango, Zacapa; In the metropolitan area they have three. Apart from three Express models.
Spectrum has, according to data on its website, four large shopping centers such as Miraflores, Naranjo Mall, Oakland Place and Portales, in the city.
Grupo Onyx has 5 plazas in the metropolitan area, including Plaza Madero, and one in Huehuetenango as Zentro Plaza. The particular model of this chain is convenience stores, developed in sectors that have been considered not to have been served, with main anchors and commercial premises.
Additionally, of the 7 Centers that Íntegro has, four are in the interior of the country such as Alta Verapaz, Escuintla and Totonicapán, and the rest in the metropolitan area. They indicated that they focus on development in the interior of the country, following the prioritization made by the Ministry of Economy of the 9 development nodes, and the objective is to decentralize the economy and promote economic development in all regions.
Sources: Association of Shopping Centers of Guatemala (Acecogua); José Fernández president of Francorp for Latin America; Sarah Alzugaray, Owne Broker of the Alzugaray Real Estate firm, shopping center information collection
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