
Vacant retail spaces are becoming an increasingly common sight in shopping streets across Austria, with even prime locations now feeling the impact of changing retail trends.
Industry experts warn that these vacancies are being driven by shifts in consumer behaviour and rising rents.
Online shopping, high rents and poor-quality retail properties
Inga Horny from Klagenfurt Marketing describes the situation as a “massive shift” in the retail sector, highlighting that some properties are “difficult to rent out due to excessively high rents.”
A significant factor in this trend is the rise of online shopping, which is increasingly undermining traditional retail, especially in the textile sector. Horny explains that large retail spaces, particularly those spread over multiple floors, are “very difficult to find new tenants for” as they are no longer considered fit for purpose.
Location consultant Ines Delic of Regioplan points to the “fundamental issue of overly large retail spaces,” predicting further reductions in retail space and more bankruptcies among physical stores. While the problem is widespread, it is especially visible in smaller towns, where vacant shops are more noticeable and could even lead to the collapse of local services.
Delic also points out that many cities are grappling with poor-quality retail properties. Horny adds that in Klagenfurt, some spaces are “in such a dilapidated state that they cannot be rented out,” primarily due to issues with sanitary facilities and the lack of staff break rooms.
Potential solutions
Experts agree that one potential solution to tackling vacancies is encouraging more residential development in city centres. Horny says, “City centres need to be made attractive again as living spaces.” Delic further emphasises the importance of creating a more holistic shopping experience. “People, especially younger ones, are spending their money differently now. Everyone is being more mindful of their spending due to the crisis; younger people are buying second-hand goods and spending more on experiences or things related to body consciousness.”
According to Delic, shopping streets need a fresh mix of businesses to attract foot traffic and encourage spending. “If I don’t have the right mix, the economy won’t help – it’s all about consumer trends,” she says.
Situation on the ground
Vienna’s Mariahilfer Straße, the city’s main shopping street, is not immune to this trend. Rents for commercial spaces here can reach €30,000 or more per month, and several large chains have already vacated prime locations. A similar pattern is emerging in Salzburg’s Getreidegasse, where iconic brands such as Zara, Marionnaud, and McDonald’s have left the heart of the old town, giving way to a rise in souvenir shops.
Salzburg, with approximately 72,000 square metres of inner-city retail space, is facing a vacancy rate of 3.5% in the Getreidegasse and 7% across the city centre. Oßberger points out that the average retail space in Salzburg is just 106 square metres, with rents in the Getreidegasse ranging from €50 to €140 per square metre per month, further contributing to the growing number of vacancies.
Innsbruck, on the other hand, has largely been spared from large-scale vacancies, thanks to its thriving tourism sector. However, Michael Perger from the City Centre Association warns that ground-floor spaces are increasingly being taken over by hospitality and service businesses, and the influence of online retail will eventually extend to the Tyrolean capital. “There should be no more retail space, particularly at the outskirts,” Perger says, emphasising the need for public investment in improving the quality of public spaces.
In Graz, the retail sector has faced its own set of challenges in recent years, particularly as the city is dominated by independent retailers. According to Rainer Will, managing director of the Austrian Retail Association, Graz has fewer branches of large retail chains compared to cities like Vienna, where 40% of businesses in prime locations are chain stores. The vacancy rate in Graz’s city centre is 3.2%, lower than the national average of 4.9%. However, retail space in Graz has shrunk significantly since 2014, with 7.7% of former retail spaces now repurposed for other uses. “Graz is one of the leaders in this trend,” says Will.
In smaller towns across Austria, the situation is even more precarious. In Dornbirn, Vorarlberg, Heidi Mark from the local retail association notes, “It’s no longer as easy as it used to be, where the next tenant was already waiting.”
The ongoing trend of vacant retail spaces across Austria’s cities reflects broader changes in the retail industry and shifts in consumer behaviour. Both economic factors and evolving shopping habits are contributing to this issue, which is likely to continue reshaping the Austrian retail landscape.