The X5 Retail Group project to open passenger service centers with shops, cafes and pharmacies at the railway station paused. For the year, no center has ever opened. X5 explains this problem with effective locations.
Egor Levchenko, director of the retail real estate department at ILM, says that the refusal to open a passenger service centers may be related to the fact that rental rates at railway stations were unusually high for X5 Retail Group.
“The main tenants of transport facilities are cellular shops, catering, banks, pharmacies. They pay rental rates significantly higher than grocery retail, by 25% or more, Levchenko said. “At the first stage of searching for points of this format, the X5 could simply not withstand the competition and abandon this idea.” Another reason Levchenko cites is that over the past year, X5 Retail Group competitors have weakened the focus on the development of the main retail formats. “There were a lot of internal structural changes among competitors — optimization at Dixie, change of owners in Magnit. Against this news, for the leadership of X5 Retail Group, it was logical to develop its main areas, strengthen the business in relation to competitors, rather than experiment with new formats, ”Levchenko argues.
Read more at RBC: https://www.rbc.ru/business/19/10/2018/5bc88ec29a79471cb2bc9cdd?from=main