Coming Spring 2024 Outlet Village in Tbilisi

It was a no-brainer that Tbilisi would tick all the boxes for the Fashion capital of the region and be a perfect location for an Outlet Village. The First in the region, allocated over 10ha, with 20,000GLA, 110 units development that would offer a unique shopping experience for visitors is opening its doors in September 2024.

Tbilisi Outlet Village would be the first of its kind in the region, offering a wonderful fusion of worldly renowned brands, leisure, and gastronomic experiences. The village's architecture has been designed by the globally recognized, leading Spanish designers, with Georgia's cultural heritage in mind, and will be a harmonious blend of historical and modern to best showcase the beauty of its location.

The Outlet Village is brought to Tbilisi by Georgian Outlets & Resort Group and TORG, one of the major developers of Outlet Villages in USA and Europe. TORG's comprehensive approach and team of experts provide unparalleled advice on creating the world's best outlet villages in the United States, Europe, and developing markets. TORG's Unique advantage is tailoring its broad experience and expertise in various fields like project development, marketing, leasing, operations management, and retail to the individual countries' cultural and social attributes. This creates village centers that would best meet the local retail preferences, needs, and requirements, as well as general global fashion trends. The Tbilisi Outlet Village will be entirely managed by TORG.

The founders of Georgian Outlets & Resorts Group are a famous Georgian development & construction Group – Domus Group and seasoned Georgian businessman Mr. Guram (Guga) Tsanava. We had a pleasure of interviewing Mr. Tsanava, who is an experienced entrepreneur and executive with an extensive background in senior management positions at large organizations. He sat in boards of various major business associations and holding companies. His remarkable educational background speaks for itself - he was one of the first graduates of Stanford Graduate School of Business from Georgia, currently being Stanford's Global Ambassador. He completed courses at Harvard and Wharton Universities. He gained a special qualification in Project Management from the Stanford School of Engineering. He has contributed significantly to the education system in Georgia by bringing a Grenoble MBA program to Caucasus University in earlier days, occasionally delivering Strategy lectures to MBAs up to now. He was the first person from the entire region to be interviewed and published at Stanford Business Magazine, the world's premier publishing.

An entrepreneur at heart, Mr. Tsanava oversees a few significant ongoing projects such as New Shopping Mall in Rustavi – Rustaveli Mall, Tbilisi Outlet Village, Illy coffee houses chain, and fashion retail company, to name a few. All above mentioned gives him an aerial view of the industry and Georgian market. His academic achievements and diverse experience form his unique perspective, which, coupled with vast knowledge of the Georgian market, makes predicting significant industry trends relatively easier.

Talking to Entrepreneur, Mr. Tsanava unveiled some exciting news about the highly anticipated Tbilisi Outlet Village.

Could you please tell us more about how the development of the outlet village is progressing?

The construction works are planned to be completed towards the end of Autumn 2023. We will shortly start negotiations with private restauranteurs and large food chain managers to ensure the visitors have a wide variety of food choices at the premises.

Currently, 70% of brand pre-lease contracts are already signed, while finalizing major leases will be finalized within the next two months utmost. The rest are in the pipeline. There are 15 to 20 brands not officially represented in the country yet, but they would like to enter the market and have their flagship stores opened in Tbilisi. Those brands are looking for a local partner or investor who would be interested in operating under the exclusive license. We at Georgian Outlet & Resort group helped some of those brands connect with local investors and suggested adding new brands to their portfolios or considering investing in new ventures.

Many of the already signed contracts are with medium to premium brands. We are excited to represent and have them enter the market through the outlet village. We are proud to share the names of renowned global brands opening stores, such as PINKO, DKNY, Wolford, Patricia Pepe, and many more. It should be an excellent start to the fashion journey for Tbilisi. We are also glad that, basically, we are helping the general fashion industry, indirectly, to prosper and grow further via all those new brand attractions and mediations.

TORG oversees the recruitment process, too, along with marketing & PR, bot globally and locally. They have already prepared an extensive marketing budget. Hundreds of thousand dollars in annual Marketing spending is unprecedented for the shopping malls in our region so far. We anticipate the Outlet Village to attract over 7 million visitors in the first three years.

The marketing strategy was developed around that notion - the outlet village is a leisure, entertainment, and shopping destination. It will offer many services not provided by other shopping malls, like - special tours, BUS tours, VIP shopping, etc. The e-commerce platform is currently under development and will launch once the Outlet Village is open to visitors too.

Do you think the outlet villages are gaining momentum? If yes, why now?

The outlet Villages are certainly becoming trendier, and there are numbers to prove it. ACROSS – The European Placemaking Magazine- covering topics of retail property, high street, shopping, and entertainment, writes that the revenue of outlets around the world increases to 30% - 70% and, in some cases, even doubled. An interesting phenomenon is that many brands that did not have an outlet store deemed it to be profitable enough to consider establishing one and started working on creating collections specifically for the outlet stores.

With its modern design and infrastructure, the strategic location of the Tbilisi outlet village turned out to be so attractive as a new retail market in the region to global brands that they agreed to open stores directly in the outlet without a flagship store in the country, which is not usually the case. We already have five brands agreed to Outlet Village stores, and some are considering the venture.

What should we expect in Tbilisi Outlet Village, and how the surrounding area changes due to this development?

The survey we conducted with the help of ACT, global research and consulting company, gave us valuable insight into the most desired brands in Georgia. Collected consumer feedback on the top 5, 10, and 20 most wanted brands in 11 Categories - luxury, women, men, children, unisex, accessories, shoes, etc. The anticipated demand for the type of brands gave us a great starting point for our leasing strategy.

Every brand has individual store sizes, layouts, and ambiance requirements. We work closely with all brands and their local partners to tailor the location and design to their needs. All details, like construction works, furniture, and so forth, are agreed on to contribute to the correct brand positioning.

At this outlet, we are not talking about excess stock to be sold but either clothing specifically manufactured to be sold at outlet stores or merchandise from global stock and obviously first-quality.

Brand lease contracts limit brands to only selling 20% of their local flagship store leftovers in the Outlet Village. The remaining goods should be sourced from global merchandise to ensure ample choice in size, design, and collections. The brands should cater to fashion-savvy clients and provide fresh and exciting collections displayed and offered at the stores.

Frankly speaking, we do anticipate further development of the area around us– hotels, restaurants, infrastructure – we might not be directly involved but believe that this outlet village will propel the development of the area.

There are a few reasons outlet villages are becoming more attractive to consumers, especially after the covid, one reason being the willingness to return to physical stores. The fact that outlets now have a more comprehensive selection of goods and affordable prices makes it an obvious choice as well. Recent research suggests that people are more comfortable with outdoor spaces and more open-plan shopping destinations following all the restrictions during the pandemic – claimed to be safer than closed spaces.

The scale of Tbilisi Outlet Village is impressive as strategically situated, it should cater to the region – Armenia, Azerbaijan, cross-border travelers, and surely the Georgian customers – a required condition for TORG to invest in this project. The objective is to make this place a kind of getaway, a destination for shopping, dining, and entertainment just within 30 min drive from Tbilisi.

This Outlet Village can be seen as having untapped potential for Georgia. Already home to many global brands in hospitality and retail and the proximity to Europe will only promote Tbilisi to becoming a new world-class shopping destination.