The first OCR Reports in Poland30 November 2018
Following months of discussions and work, the Retail Institute publishes today its first report which analyzes rent rates, service charges and affordability, OCR indexes for 19 various retail and service sectors operating on shopping centers. These are yet another parameters after footfall analyses (FF ReIndex) and turnover analyses (TO ReIndex) which are implemented by RI. They are the only such in Poland.
The OCR index (Occupancy Cost Ratio) is one of the most fundamental tools or even the only means, as some experts believe, to reliably evaluate financial stability of shopping center tenants. It show the correlation between rent and service charges on the one hand and turnover on the other. Rating agencies tend to use the index as much to discuss rent rates as to evaluate shopping centers in terms of their investment potential.
These new OCR analyses are complementary to the TO ReIndex Report. As a result, participants in the ReIndex project will be able to keep track of fluctuating turnover generated by 19 various sectors such as fashion – women, fashion – men, footwear or electronics as well as of their financial standing. RI provides managers and investors with a tool which will support discussions concerning rent rates and service charges.
“While working on the OCR methodology, we tried to include all principal conditions set out in lease agreements made by landlords and tenants. We believe that the OCRs we have published are still in progress, which means that we do not rule out changing their methodology of calculation in the future,” said Anna Szmeja, President of Retail Institute.
The TO & OCR ReIndex Reports prepared by the Retail Institute team will also contain data regarding the value of rent rates and service charges shown as a single figure. “Is there any other piece of information more valuable than the value of rent rates and service charges? Since January 2017 up till the current month, RI has been collecting data from more than 65 shopping centers, which makes them fully representative and valid. I am very proud that together with the Participants in the ReIndex project we have decided to take such a bold step. I am convinced that the shopping centers and managers gathered around Retail Institute projects will continue to set new standards of data exchange, which will certainly translate into further development of the retail sector”, concluded Anna Szmeja.