Never Mind The Discounts, Next-Gen Outlet Malls Target Tourist Stays
Europe’s newest designer outlet centres will not just include discounted brand stores but will also feature hotels, wellness and even residential as developers look to expand a retail concept that has proved largely immune to the consumer downturn.
While new development all but stalled in 2024, existing centres have largely continued to thrive, and a new generation of outlets beginning to open this year are a major departure from tradition.
Cotswolds Designer Outlet will open in the UK in 2025. New centres are delivering in Krakow, Poland, and Tbilisi, Georgia, in 2026, as are extensions to Porto Fashion Outlet in Portugal and McArthurGlen’s Troyes, France, and West Midlands outlets. Several more new schemes and extensions are scheduled across Europe in 2027 and 2028.
Sales across Europe’s circa 210 outlet centres totalled €23B in 2024 and will grow to €30B by year-end 2028, sector specialist Ken Gunn Consulting estimated in its 2025 European Outlet Industry Review.
Owners now hope to capture income beyond those shopping sprees.
Compagnie de Phalsbourg is planning an outlet village called Village De Sophia in the south of France. The 942K SF project near Antibes will include 80 stores and 25 restaurants but also 161K SF of offices and a 65K SF hotel, with completion due in 2028 or 2029.
“The industry has to adapt to the competition and the times,” Compagnie de Phalsbourg founder Philippe Journo said at Magdus, an industry event in Paris.
Meanwhile, Frey — better known for shopping centre and retail park development — has teamed up with designer outlet specialist Ros to expand its portfolio of 12 outlets in eight countries.
Its first acquisition was the purchase of McArthurGlen’s Designer Outlet Berlin scheme, and CEO Antoine Frey speculated that there may be opportunities to turn full-price malls into outlets.
“Developing a new scheme takes 10-15 years, so I feel there must be a way to twist existing outlets,” he said, adding that the company is analysing catchments to identify “holes for outlets” across Europe.
“Our ambition is to create a large outlet portfolio not just in France but also in the biggest outlet markets, including the UK and Italy,” he said. “The point is not to copy what the best outlets are doing — we’ll find our own way.”
Cushman & Wakefield head of UK retail and EMEA outlet malls Richard Ching said there has been a clear evolution of outlets toward tourism-focused offerings and said investors are looking at sales density, potential development and performance predictions as the primary benchmarks for investment.
The stats are all alluring: Average sales growth rose 5% last year and is up 17% since 2019, he said. Foot traffic rose 3% and is up 1.2% in the last five years.
“Retail is definitely back, and everyone wants to talk about retail, but outlets don’t stand still. They have to move forwards,” Ching said.
