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The retail trade is one of the largest and fastest growing sectors in Georgia. Georgia is the most active and attractive economic center in the region. Georgia has a liberal tax code, corruption free government, and great opportunities for foreign investments, as it provides a highly supportive business environment. During last two decades, Georgia has implemented many affective reforms that have supported to political and economic transformation. It has strengthened its democracy and furthered its relationship with the European Union. In Georgia property rights are recognized and protected by the Law. An owner has the right to possess, use and dispose of his or her property. The rights of individual owners to possess, use and dispose of land are regulated by the land legislation. There is no restriction on non-agricultural land ownership in Georgia. Georgia is positioning itself as an attractive option to the international business world while Georgia has made business development a top priority through encouraging entrepreneurship, attracting private investments, and shifting tax incentives. With its unique cultural heritage and known hospitality, Georgia’s tourism industry continues to grow year by year and the growing number of tourists supports the development of many areas of retailing.  In 2018 the number of visitors to Georgia continued to increase steadily, with the number of people entering the country as tourists exceeding the local population. This not only benefited tourism in the country but many other industries, including retailing. Hereby it should be noted, that an internet and mobile internet retailing continue their double-digit value growth. The increasing internet coverage in the country and its affordability has led more Georgians to become technology friendly. In parallel, the developed banking system is strengthening consumer trust in online purchasing transactions.

Thus, retailing in Georgia is increasing year-over-year and is expected to continue its positive performance, supported by a strong outlook for the economy. The total volume of retail floorspace in Tbilisi, Batumi, and Kutaisi is increasing too fast compared to the last years.  Capital city Tbilisi dominates Georgia’s trade economy. The largest part of retailing is found in the capital city, though still dominated by bazaars and open-type markets. It is notable that bazaar floorspace is not increasing in contrast with modern shopping centers.  

Modern shopping centers continue to increase their share of the market year-over-year.  By the end of 2019, it is expected that the modern shopping center floorspace will exceed that of bazaars. One of the shopping center, which is located in the heart of the city, accounts for an 25 k.sq.m. of space and offers variety choice of entertainment and leisure activities, such as cinema, bowling, food courts and fashion stores. Another shopping center, which was opened in one of the district of Tbilisi, with a total gross leasable area of 22 K.sq.m, doubling the district’s floorspace and boosting its competitiveness. The number of specialized shopping centers is also noticeably increased due in large part to the opening one of the Mall with a gross leasable area of 110 K.sq.m. the shopping mall is classified as ‘very large’ according to ICSC’s international standards. Today, the mall is mainly occupied by non-branded shops.

Several big company bolstered the hyper/supermarket category by opening stores in these big shopping Malls. The Catering category grew due to the rise in street retail on rehabilitated one of the famous Avenue in Tbilisi, and the opening of new world wide famous fast food brands in new shopping centers. The Entertainment category absorbed around 5 k.sq.m. of modern shopping center space, including several cinemas and etc.

Batumi also experienced an increase in retail supply in last years, with the opening of two new malls which added another 20 k.sq.m total of modern shopping center floorspace. The total volume of leasable retail floorspace in Batumi exceeds to 164 K.sq.m. The retail supply is dominated by high street retail. Bazaars and open markets occupy around 25% of the supply, modern shopping centers and other shopping facilities have around 24% and 5% of the share, respectively. One of the Mall, which was the first shopping center in the city provided shoppers with different retail categories spanning multiple floors. There are household goods and furniture, followed by fashion and footwear retailers. In other Malls there are represented fashion, catering and other category retailers. City’s several primary high streets, offering visitors various attractions, cafes, restaurants, and fashion stores.

In the past, the demand for Batumi’s retail space was dominated by local, nonbranded tenants. This trend began to shift in last years as new shopping centers opened, increasing the number of international brands available. With several company’s expansion and the entrance, which in total absorbed almost 4K sq m, most of the leased retail floorspace is held by hyper/supermarkets. The second largest category is Electronics, the majority of which can be found in high street locations. The Household category absorbed almost 2 k.sq.m. The Catering category grew due to the entrance of several international famous fast food brands.

As compared to Batumi and Tbilisi, Kutaisi’s retail market is the least developed. Thus, there is a big potential and a big opportunity to invest in Kutaisi’s retail market. Existing modern shopping centers provide better facilities in comparison to bazaars. Additionally, the common practice of selling individual retail units makes investment opportunities more challenging. Kutaisi’s total leasable retail floorspace amounts to around 130 K sq m, with modern shopping centers holding the majority of leasable area. High streets are offering around 31% of the total supply. Kutaisi’s primary streets are leased by service, fashion, health & beauty, catering and hyper/supermarket tenants.

Electronics consumed the largest portion, taking around 64% of Kutaisi’s retail market. There are a limited number of international brands in modern shopping centers. There is only one international fast food brand in Kutaisi. High streets are occupied by a wide variety of categories, including service representatives (Banks and micro finance organizations), several supermarket chains, a few international fashion brands, electronic retailers, and pharmaceutical companies.