Reunification between eastern and western German shopping centres is still some way off, in the view of Joachim Stumpf and Lars Jähnichen from IPH Centermanagement.
While German investors still display confidence in many parts of their domestic retail market, international investors are very cautious, especially with regard to eastern German shopping centres.
This caution is not unfounded. The East German market tends to require a great deal of location expertise. What’s more, although shopping centres in East Germany seem to face the same challenges as those in the rest of the country, it is clear that different socioeconomic and urban planning conditions exist in the new federal states due to the different ways in which those systems have developed over the last three decades — and the consequences of these differences are still being felt today.
A little history can help shed some light on those differences.
After reunification, West German retail
