In a country with a free market not even two decades old, it's stunning to realize that there are more than 30 major shopping centers up and running. To go from one kind of bread at the local potraviny to Tesco, Mango, Zara and Marks & Spencer is quite a leap in shopping habits, not to mention a major boost to the national economy.

In the first half of 2005, five new shopping centers opened: Galerie Butovice, Eden Carrefour and Centrum Chodov in Prague, Kolonada Karlovy Vary in the famous west Bohemian spa town and Galerie Vaňkovka in Brno, south Moravia. Metropole at Zličín in Prague and Olympia in Brno were expanded.

By the end of 2007, another 13 shopping centers are schedule to open across the country, adding 390,000 square meters (4.2 million square feet) of new retail space. Letňany in Prague will be the biggest at 85,000 square meters, and at 39,000 square meters, the upcoming Palladium will completely remake the look and feel of náměstí Republiky in Prague's historic city center.

What is fueling such explosive growth? Fundamentally, it's a simple matter of supply and demand.

"The Czech Republic is still catching up with Western Europe in terms of modern shopping center space, due to the lack of development under the old regime, and due to the lack of historic high street locations in some cities and suburban locations," says Martin Žižala, a retail associate and broker with Cushman & Wakefield. "The demand is being created by [both] the customer and by local, national and international retailers who are looking at new opportunities to expand their operations. The developers are, of course, listening to retail demand and constructing new space."

There's certainly been no lack of prominent retailers and developers eager to plant a flag in the Czech Republic. To name a significant few: Tesco, Globus, Ahold, EPD, Plaza Centres, AM Development, TK Development, Africa Israel, Rodamco, ECE, IKEA, Somerston, Portland Trust, Discovery Group and Ballymore.

The rush to build raises a natural question: Is this a retail bubble, or are the majority of developers and their glittery consumer palaces here to stay?

"We believe this is a continuing trend," declares Žižala. "As in other, much more developed markets, new shopping centers are [constantly] being built and older shopping centers are being refurbished and expanded. Retailing is a continually changing business, and shopping centers need to change to keep up with new trends."

Everything under one roof

The main criterion in deciding to build a shopping center is the numbers, starting with an area's population. The base number needed to support a shopping center (defined as a structure supporting more than 10 retail units) is 50,000 residents. The Czech Republic has 22 cities with that many people.

Incomes are rising, but what's just as interesting to developers and retailers is the finding that Czechs spend an average one-fifth of their incomes on food and beverages. So it's no accident many new malls include hypermarkets or large supermarket outlets.

Increasingly, the appeal of shopping malls is about more than just offering consumer goods. Malls have become community centers, places people come not only to shop for specific needs like shoes and clothing, but for entertainment and dining with family and friends, preferably without traveling to another part of the city.

This is why developers are paying detailed attention to what entertains the customer — be it movies, art or fine dining or, better yet, a combination of all these. A spokesperson for TK Development, which designed the ultra-modern Šestka center in Prague 6, says, "The area has tremendous growth potential, and we think it's important to give an equal boost to an area with the potential to be another Prague 1, 2 or 5."

Cushman's Žižala has noticed the growing multipurpose function of malls as well, with more developers trying to put everything under one roof. "The growth story is validated by successful shopping centers like Nový Smíchov and Metropole," he says. "The upcoming Palladium is set to have 6,000 square meters dedicated simply to food and drink. The incorporation of leisure elements like cinemas, restaurants and game stations is what completes the shopping experience, as it tends to bring families in droves, relying on the 'something for everyone' cliché."

Aesthetics are also playing an increasingly important part in the mall boom. When ING Real Estate Development did a survey studying shopping trends as it began developing the Košíře area in Prague 5, it found that shoppers sought not only brand quality, but pleasant surroundings to shop in.

An innovative developer like Rodamco, which designed Černý Most shopping center and the upcoming Arkady Pankrác, is also focusing on the importance of ultra-modern design. As one promotional brochure for the company notes, "We want the customer to feel a sense of novelty when he walks through our designs."

Steady and upward growth

Not only do shopping centers create a certain centralized atmosphere, but they also generate interest and demand for a high-street type of development — upscale shopping strips like Prague's Na Příkopě or, to a lesser extent, Pařížská streets. As it happens, these strips preceded mall development, but the retailers they've attracted are typical of high-street spinoffs in other cities: Mexx, Mango, Kenvelo, H&M, C&A, Marks and Spencer, Zara, Promod and Leiser, to name some of the most prominent.

With disposable incomes on the rise — and tourists flocking to upscale shopping strips — the Czech Republic already has high streets that are being compared, in promotional literature at least, to similar locations in cities such as London, Paris and Milan.

In short, all signs point to a spending spree that will be a long one. Beyond the real estate figures, there are economic indicators like the 5.9 million debit cards in circulation in the Czech Republic in 2004–05. "We issued almost 43 percent of the country's debit cards," says Klára Gajdušková, a public relations officer for Česká spořitelna, commenting on how the volume of transactions is racing to keep up with the new spending habits.

When it comes to shopping malls, the laws of supply and demand rule — at least for the moment — complemented by the desire for a better quality of life in more aesthetically pleasing surroundings. With developers designing dream malls and giving people ample space to socialize in, the growth trend remains steady and upward.

Of course, the national economy could put a dent in the retail growth rate if it slumps. But as long as both are riding a upward curve in tandem, the ubiquitous shopping center is here to stay.