Malls – the new, convenient way to shop in Istanbul

The Grand Bazaar has been a feature of Istanbul for over 700 years; an open air marketplace, filled with noise and colour where carpets, jewellery, hats and clothing purchases are all subject to fierce, but friendly, haggling.

However, that traditional image of shopping in Turkey’s biggest city is under threat as today’s more affluent generation demand shiny glass and metal malls so they can shop in relative comfort.

Growing prosperity is paving the way for an increase in the number of shopping malls in Turkey, most of which are financed by foreign investors, attracted by the potential profit that could be generated by a population of 70 million that is getting richer every year. According to data recently released by the Turkish government, average yearly income in the country leapt by almost 25% between 2006 and 2007, and they confidently expect that trend to continue.

Major retailers are hoping to pick up on that increasing affluence by creating western style shopping experiences. However, new shopping mall openings are not without their difficulties and there have been some problems renting out retail spaces. Most Turks still shop at small grocery outlets or bakkals, but the shopping centres are becoming increasingly attractive to more globally influenced younger generations who wish to shop, dine and enjoy their entertainment in one place.

It is the economic stability of Turkey that is attracting foreign investment ahead of other possibly more volatile economies in the area. However, inward investment isn’t just restricted to shopping centres, as many major chains have opened new hotels in Istanbul and international property investment moguls are also investing heavily in residential and office premises throughout Turkey.

The ease with which foreigners can invest in Turkey has removed many of the perceived barriers to inward investment. Even U.S financial big-hitter Donald Trump is rumoured to be on the verge of investing in an elaborate combined office, residential and shopping mall complex in Istanbul.

Turkey’s first shopping mall was opened in 1988, but doubts over the economy meant that, until the onset of an economic surge in 2001, foreign investment was scarce. There are currently 189 shopping malls in Turkey and that figure is expected to rise to 350 by the end of 2010. The Turkish government predicts that over $20 billion will be invested by foreigners during 2007 alone.

The majority of those new developments are being created in Istanbul due to the city’s 12.5 million residents, but, despite an aggressive retail expansion on the horizon, concerns that Western influence could sound the death knell for the traditional Grand Bazaar are definitely premature.

Daniel Collins writes on a number of topics on behalf of a digital marketing agency and a variety of clients. As such, this article is to be considered a professional piece with business interests in mind.