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Builders Bullish on Malls, But Will Shoppers Flock?

October 13, 1996

BUDAPEST, Hungary (AP) _ With more than 100 stores, fast-food outlets, nine movie theaters, a skating rink and supervised child care, all Duna Plaza needs is cruising teenagers to complete the picture of a U.S. suburban mall.

But this mall, opening today, is the first in formerly Communist Central Europe _ an area where people struggled for years with the surly service and limited offerings of state-owned shops.

Most consumers still are struggling to make ends meet, and many wonder whether they can afford such shops. But entrepreneurs have bet millions that the post-Communist downturn is bottoming out.

What’s more, they argue, malls will be a magnet because they’re more than just a place to shop: They represent a Western lifestyle people envied in the lean Communist years.

``Budapest could support five such malls,″ said Miklos Kozma, chief of Transelektro, a giant Hungarian import-export firm that is a major investor in the $55 million mall. ``People will be coming from all over the country, and even from abroad.″

Just a few years ago, most traffic went the other way: Hungarians and other Central Europeans were cramming into tiny sedans and heading across the border to countries like Austria for shopping. They make fewer trips now that markets have opened and consumer goods have flooded their countries.

Some Hungarians have struck gold in the transition to capitalism. But the average monthly wage is less than 50,000 forints ($330). Retail trade dropped by 6 percent in the first five months of this year.

Duna Plaza, built in an old north-side industrial neighborhood, is advertising itself as a place to shop and have fun. An underground passage connects it to the Budapest metro, and it tempts shoppers with Western stores.

``They’re more than a place to shop, they are a lifestyle,″ said sociologist Tibor Dessewffy.

But steep prices _ like a black shirt at Britain’s Marks and Spencer store costing 30,000 forints ($200) _ will likely keep many local folk away.

``We certainly won’t be shopping there,″ said Maria Toth, a 47-year-old office clerk and mother of two teenage sons. ``These malls are for people who don’t need to check the price tags.″

Such attitudes haven’t slowed down the mall enthusiasts. In fact, three more malls will open in the Budapest area within a year.

The next mall opens Nov. 8. The Polus Mall is a 400-shop, $100 million behemoth built on an old Soviet army base just east of Duna Plaza. Two more malls, with Austrian and French financing, open next year.