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BCSC Retail Summit: Town centres need revolution.

By Graham Shone on May 15, 2013 9:07 AM | No Comments | No TrackBacks
Yesterday's Estates Gazette/BCSC Retail Summit gave the strongest impression yet that the industry is ready to cut loose the chains of its troublesome recent history, and focus on creating a bright and prosperous future.

The most stark indication of this attitude came from Distressed Property Taskforce chairman Mark Williams, who said categorically that the industry group was focused solely on the future - and it looks like being one borne of something of a revolution in retail property. 

Williams said what everyone already knows - that there is an oversupply of retail space in this country; but added that in some locations the oversupply is by a factor of around 50%, and that levels of regeneration not seen since World War II are necessary to recalibrate the retail market in those long-suffering locales.

Last year's BCSC Conference was laden with references to 'managing' town centres as one would a major shopping centre - and that theme was heavily expanded on yesterday. New River Retail's Charles Miller told the room that investment in a major mall is not just about what you're buying, but the surrounding area; and how crucial it is to create fusion, rather than friction, between the two.

It was mentioned on numerous occasions by more than one speaker that fractured town centre ownership is stymieing the requisite improvement in high streets, and engenders the old-style laissez-faire landlordship once leases are secured. 

In the interest of combating such attitudes, Peter Brett Associates launched their 'Town Centre Investment Management' (TCIM) initiative during the afternoon session. It is designed with the expressed intention of bringing investment back into the high street by using an adapted form of Local Authorities' CPO powers to bring about uniformity of town centre ownership.

Whilst these aren't necessarily new ideas, the belief is that with the momentum currently behind town centre regeneration and the ongoing political discussions around the subject, now could be the best time to force political will in the direction of supplying proper solutions to those well-documented town centre problems.

Political will could yet prove to be the greatest stumbling block to securing that bright future for the retail industry. Consents still fly in for out-of-town developments, occasionally going against the recommendation of planning officers, and there was a palpable scepticism in the room when asked if Local Authorities had the collective desire to make a policy such as TCIM work in the long term.

BCSC President and Chaiman Marcus Kilby said in his summary of the day's discussions that 2013 could yet be the year looked back on in a decade or so as the year in which the retail industry began its crucial evolution into an overwhelming success story. The first shoots of that evolution are present, without question; but there remain several overarching caveats that must be addressed before that first great leap forward.

Online success shines through Christmas results

By Annabel Dixon on January 12, 2012 5:57 PM | No Comments | No TrackBacks

This week has been quite a revealing week for the retail industry with some of the UK's biggest retailers producing their Christmas trading results.

 

There have been some clear successes. House of Fraser, John Lewis, Sainsbury's, New Look, SuperGroup, Debenhams, Majestic Wine, Foyles, Morrisons and JD Sports have all reported increased like-for-like sales figures.

 

But there was a more worrying picture being painted by the likes of Home Retail Group, Tesco, Mothercare, Halfords and Thorntons, which all flagged up falling sales. Some of these lacklustre results come despite widespread discounting in the run up to Christmas, which will have hit retailers' pockets.

 

A clear opportunity or warning sign (depending if your glass is half full or half empty) for both retailers and landlords to pick out of these results lies in the blossoming online sales figures. They helped some retailers push through a tough trading period.

 

John Lewis said: "Our very successful multichannel and online operations have been at the heart of John Lewis' performance. All three John Lewis markets were instrumental in driving sales in this area, with johnlewis.com outperforming its market and seeing 27.2% growth."

 

"As the 'Click and Collect' facility has proved to be so popular, from next month the number of collection outlets will more than double to 116, including collection points in 84 Waitrose branches, with more being planned."

 

Debenhams' like-for-like sales increased by 1.4% including VAT in the 18 weeks to 7 January 2012. However, its online business, which it says is a key component of its multi-channel offer, delivered like-for-like sales increase of 34.8%. 

 

Ellen Flood, retail expert from Shopow says: "The internet is developing as a key element of the retail landscape. Online shopping offers shoppers an incredible amount of choice, convenience and savings."

 

"What we will see this year is the evolution of the high street with leading retailers changing their approach, and in many cases their product lines, to reflect the tastes of the modern shopper."

Social Media: A Missed Opportunity?

By Graham Shone on December 6, 2011 4:17 PM | No Comments | No TrackBacks
Some intriguing research was published this week by BCSC, which investigated shopping centres' relationship with social media, and how retail schemes could better utilise such platforms to their future advantage.

By analysing primary data collected from shopping centre managers and social media users, BCSC were able to determine how effectively the two were interacting.

Some statistics published in the research were illuminating. When asked why they didn't follow a shopping centre on social media, a combined figure of 31% of the respondents said that they were either unaware of the scheme's on-line presence or had never considered it as a means of interaction. In addition, only 12% of shopping centre managers said that a dedicated social media executive was tasked with managing their on-line output, and less than half of the centres (42%) carry any written guidelines on social media usage.

These are just a few of the statistics that point to a missed opportunity for schemes to engage with customers on an increasingly popular platform. There seems to be a very clear and obvious dichotomy between what the public would want from a shopping centre via social media, and what those centres are currently providing. The malls seem to currently churn out repetitive marketing material, precipitating a swift click of the 'unfollow' button. People would, in fact, prefer malls to inform them of new store openings, upcoming events and news about improvements to the centre.

An issue that is brought up in defence of social media negligence is one of metrics. Malls find it difficult to quantify the benefit given to them by an increased on-line presence, and whether indeed it would be worth spending money improving their output on such sites in order to generate increases in revenue that may have arrived regardless. My view is that with some 175 million people people now using Twitter, and 400 million logging onto Facebook daily, is ignoring the potential of social media a risk that retailers and retail developments can afford to take?

The fact is, more and more people are harnessing the 'wisdom of crowds' provided by these sites to inform their choices when it comes to retail - and negative on-line publicity spreads like wildfire. Without active management of social media output, centres could find their reputations tarnished in the blink of an eye via a chatroom, hashtag, or an orchestrated on-line campaign. 

Read the full report on-line here.

A brewing storm in Croydon

By Annabel Dixon on November 11, 2011 4:16 PM | No Comments | No TrackBacks

Poor Croydon. The town centre is crying out for a cohesive, coherent retail-led regeneration strategy but, judging by this week's events, I suspect it will be some time before a happy conclusion is reached.

 

Westfield's jubilation on Thursday that it is to act as a development partner to the Whitgift Foundation, which owns the freehold and a 25% long leasehold stake in the town's Whitgift shopping centre, was short lived. 

 

It transpired that Royal London and Irish Bank Resolution Corporation, formerly Anglo Irish Bank, which together own 75% of the long leasehold and the management of the mall, had no idea that Westfield and the Whitgift Foundation were striking a deal.

 

The new agreement has all the potential to frustrate IBRC in particular, since it has been advised by Jones Lang LaSalle throughout 2011 on a strategy both for its stake and the wider redevelopment of the Whitgift shopping centre.

 

The indications so far are that the brewing storm will accelerate Royal London and IBRC's ambitions to seek out their own development partner for the mall.

 

Now you can bet that Hammerson, the new owner of neighbouring shopping mall Centrale, and Minerva, which long held ambitions to develop out a neighbouring Croydon retail scheme, Park Place, will both be keeping a keen eye on proceedings. And firms including British Land, Land Securities, Capital Shopping Centres and Lend Lease have all flirted with the idea of investing in Croydon over the years.

 

So which investor - developer will catch Royal London and IBRC's eye? And what will be the reality of having potentially two parallel development agendas for one shopping centre?

 

 

For those familiar with the development of Croydon town centre, this will be just another twist in a long-running saga. But for those new to the scene: watch this space. You're in for a ride.

 

RPI rise threatens fragile retail

By Annabel Dixon on October 18, 2011 12:48 PM | No Comments | No TrackBacks

The retail property sector is set for another bruising as the Office for National Statistics' confirmed this morning that the retail prices index rose to 5.6% in September - the highest annual inflation rate for over 20 years.

 

The BRC estimates that the new RPI figure threatens to land the retail sector with a £350m business rates increase next April since the uniform business rate is set taking into account the RPI inflation rate at September 2011.

 

This of course comes at a time when retailers are already grappling with an increase in VAT, low bank lending levels and fragile consumer confidence.

 

BCSC has been quick to pounce, warning that high levels of business rates will impact retailers' expansion plans. It will in turn also affect the viability of retail development, which is dependent on securing retailers and acceptable levels of rental income.

 

BCSC, in its letter to local government minister Bob Neill today, writes: "As occupiers' business rates liability continues to increase, a greater share of occupancy costs will be absorbed by rates, eroding potential rental values and therefore the viability of proposed developments."

 

It is evidently time for the government to start paying closer attention to its independent review of the UK high street, led by sharp-tongued retail guru Mary Portas, which is identifying the level of business rates as a thorn in the retail property sector's side.

Upbeat start to #BCSC

By Annabel Dixon on September 20, 2011 8:46 AM | No Comments | No TrackBacks
Day one of the BCSC conference in Manchester got off to an upbeat start yesterday. The new timing of the conference in September (as opposed to November in previous years) seems to be well received with the industry refreshed from the summer holidays. 

The supermarkets, including ASDA, the Co-Op, Morrisons, Tesco and Waitrose, are dominating the stands once again this year. Hammerson's stand impressed with a bench lined with iPads while Capital & Regional's stand featured 3D glasses. And if anyone is in need of crockery, then look no further than CWM's eye-catching stand, which is covered with plates.   

Chatter in the exhibition hall today has touched on retail guru Mary Portas' review of the high street. One landlord said she hasn't taken the anti-landlord stance he had initially anticipated with another describing her as having a balanced view. Initial impressions then seem to be encouraging.
 
Crowds swelled in the exhibition hall for early evening drinks. However, the real hard work will start tomorrow.

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