In fact, the idea of this “market” reform was to eliminate dangerous, illegal, non-hygienic markets that contradicted the migration and tax legislation. The changes led to integration of some of the markets into modern shopping centres, and to transition of the others into somewhat exotic so-called “eco-markets”.
Examples
The first one - Ecomarket-Mytishhi was opened in December 2011. This is a modern farm market organized by Rostik Group Inc. The second one is due to open in Obninsk. It is planned to build another 10 markets of this kind in Moscow and Moscow region within next 5 years.
The popularity of this kind of markets can be explained by growing tendency towards healthy eating. People are ready to pay more in order to get products fresh from garden. Moreover, other contributing factors are – beautiful display of goods, nicely decorated stalls, food tasting, and live communication.
For example, Tsvetnoy Bazaar on the fifth floor of Tsvetnoy Central Market (GBA 38 000 sq.m). At the opening, it was the only modern farm market in Moscow and attracted wealthy customers.
Another agricultural market (2873 sq.m) functions in the shopping mall Prazdnik. This is the case of integration into existing shopping centre.
One more location where an eco-food market can be found is third floor of a transport interchange hub Planernaya.
Development cost
Consequently, a farm market can become an efficient food-store “anchor” in a competitive environment. It is to be noted that developer’s income is likely to be higher in case of integration into a conventional supermarket. Rent rate for a food store (1500-5000 sq.m) equals 250-500 USD/sq.m without operating costs and before VAT (18%). However, a stall letting (15 sq.m) can yield a profit of 45000 USD/year, i.e. 3000 USD/sq.m yearly. But here we are talking about all-year-round market, regardless of season, bank holidays, weekends; and its gross leasable area.
Nevertheless, it is still hard to call a modern farm market a common and widely spread phenomenon, as its concept goes hand in hand with high risks.
At the same time, constant development of online farm market projects (e.g. Lavka-Lavka, Fermer.ru, Ecoprodukty.com, etc), demonstrates a fast growing demand for fresh products and exposes great opportunities.
Ecomarket requirements
Ecomarket as an anchor tenant of a shopping centre must fulfil the following requirements:
- to maintain clean retail space and efficient ventilation and air-conditioning systems;
- to ensure sanitation and epidemiological safety;
- to use technical equipment that provides best possible products handling and storage;
- to follow strict merchandising rules (e.g. to alternate zones of different product groups);
- to provide sufficient inter-row spacing;
- to organize a discharge zone, deliveries and store rooms if needed.