Retail has experienced a tough time over the past 10 years. The UK has gone through a recession, online shopping has advanced and is becoming increasingly popular and BREXIT has delivered an air of uncertainty. This being said, landlords are reacting and developing their shopping centres to ensure they combat these challenges effectively.
We are seeing a lot of refurbishments which is really positive for the industry, demonstrating landlords are committed to evolve schemes and keep up with consumer trends and expectations. Cushman & Wakefield have reported an estimated 1.5million sq. ft of shopping centre floorspace is in the development pipeline for this year, with the majority representing extensions or refurbishments to existing schemes. Refurbishments allow schemes to refocus their strategy, strengthen their tenant mix and respond to current trends.
Intu has announced plans for a £13m makeover of its intu Watford shopping centre ahead of the opening of its expansion later this year. Rebecca Ryman, Regional Managing Director at intu, said: “We’re creating what will be one of the biggest in-town retail and leisure destinations and combined with our extensive mall refurbishment programme, this will create the very best environment for intu Watford’s retailers to flourish and attract an expanding affluent catchment base.” – intu also have extensions in process for Lakeside and Broadmarsh. In addition, Westfield London is under-going a £600m expansion, McArthurGlen started work on Phase II of the £90m extension at Ashford Designer Outlet and Brent Cross is enjoying a £1.4billion redevelopment!
There has been research conducted to find that mall refurbishing increases shopper traffic and enhances shopper spending due to psychological processes that trigger changes in spending behaviour. The study found that the mall atmosphere can lead to satisfaction which has proved to increase sales! Refurbishments affect spending, improve the mall atmosphere, attract tenants and increase dwell time – ultimately, improving the overall asset value.
The New South China Mall in the southern Chinese city of Dongguan first opened its doors in 2005 and was the biggest mall in the world with 660,000 sqm of space! Although it looked promising – a new big scheme for consumers – for a decade, less than 10% of the mall was occupied and earned itself the nickname ‘ghost mall’. The mall needed a new lease of life, so a renovation and modernisation project has been done. This refurbishment is drawing in more shoppers with the malls head of marketing sharing they are anticipating ‘almost full occupancy rate and no empty shops’.
It is crucial a centres marketing strategy is prepared with relevant campaigns to keep consumers engaged with the scheme. A redevelopment is an opportunity to reinvent the brand, but strategies need to be in place to protect consumer loyalty, drive new visitors and clearly communicate and celebrate the new offerings, upgrades, and benefits consumers will enjoy!
It is fantastic to see so much work and investment going into the shopping centre sector, displaying an exciting and lucrative future! The experience led operators seem to be a trend within the current developments and I’m looking forward to enjoying the new schemes when they complete!