BOSS Magazine #56 - Disruptions in the landscape of RETAIL

MAGAZINE #56

June 2016

Disruptions in the landscape of

RETAIL

The Battle of Online and Bricks and Mortar by Manon Feenstra | To

Blur or Not to Blur? KEK Delft with Leonie Hulselmans | National Vacancy Strategy Debate, Remøy vs. van Bortel | Strijp-S Creative City by Roger Broersma & Tim Maier | MegaMall Downsized by Arno Ruigrok

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Colofon BOSS Magazine is a publication of BOSS. Published three times a year.

BOSS Magazine Nr. 56 Disruptions in the Landscape of Retail June 2016 BOSS is the student association of the department of Management in the Built Environment (formerly known as Real Estate and Housing) Faculty of Architecture and the Built Environment TU Delft BOSS Magazine committee Editor in chief Sarah Heemskerk Editor Heleen Luijt Editor Luuk Gremmen Editor Joan Ruiz Pion Editor Britt van der Zandt Editor and design Astrid Potemans Contributors (in order of appearance) Erwin Heurkens Lisa Kuijpers Manon Feenstra Leonie Hulselmans (interviewed by Astrid Potemans) Hilde Remøy Gerard van Bortel Malvika Mundkur Wenhan Hu Roger Broersma Tim Maier Joan Ruiz Pion Marije Braam Arno Ruigrok Dirk van Duijn Sander Verseput (interviewed by Luuk Gremmen) Esther Brejaart Cover Luuk Gremmen Press O.C.C. De Hoog

From the editor

Sarah Heemskerk

It has been all over the news: retail stores having to close their doors because of bankruptcies.

The bricks and mortar retail stores have trouble competing with the rising internet shops. The bankruptcy of Free Record Shop in 2014 was the first sign of the difficult times to come. Now two years later, many store chains have been facing difficulties. We have seen only five months of the year 2016, but in that time the face of shopping streets has changed dramatically.

Macintosh Retail Group was facing financial difficulties with many of its formulas and in January many of them filed for bankruptcy. Among them were Dolcis, Invito, Manfield, Scapino and Steve Madden, or in other words the lion’s share of shoe stores you used to see in many cities. In February the clouds shifted over to the electronic stores when Dixons and Paradigit closed their doors forever. But the biggest blow came on the 16th of February when the biggest department store of the Netherlands, V&D, closed its doors.

All these retail stores were a big part of the identity of a lot of city centres in the Netherlands. Where in other countries a lot of retail was located outside the cities, in the Netherlands it is retail that attracts people to the city centres. The fact that a lot of stores are vacant now asks for smart and quick solutions. Without these solutions a large problem will arise in the real estate market of city centres throughout the Netherlands.

In this magazine, multiple views are given on the existing decrease of retail stores. What are the reasons this is happening? Is internet shopping winning this battle?

Manon Feenstra will answer these questions in her column about the battle between online and bricks and mortar stores. Who is responsible for finding solutions for the vacant buildings in the city centres?

Hilde Remoy and Gerard van Bortel conduct the debate regarding the statement ‘Dutch central government should create one national strategy to tackle the increasing vacancy rates of retail spaces’. Luckily there are also successful stories about retail, such as ‘KEK’, a combination of a shop, espresso bar and lunchroom. An interview with the founder and owner of this successful place in Delft will reveal the reasons for its success.

The reality can’t be ignored, there are a lot of troubles in the retail sector and therefore in city centres. However, this is the time to look forward, to think of solutions instead of problems. It is time to be creative! Enjoy the magazine!

Kind regards, Sarah Heemskerk Editor in Chief

Astrid

Joan

Sarah

Luuk

Britt Heleen

June 2016

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Content

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Book Tips

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The Battle of Online and Bricks and Mortar

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To Blur or Not to Blur? KEK Delft

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National Vacancy Strategy Debate

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Retail in India: Bigger is Better

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Retail in China

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Strijp-S: Creative City

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Saving the Inner City Center

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CBRI GI on Dutch Retail Market

by Erwin Heurkens & Lisa Kuijpers

by Manon Feenstra

with Leonie Hulselmans

by Hilde Remøy and Gerard van Bortel

by Malvika Mundkur

by Wenhan Hu

by Roger Broersma and Tim Maier

by Joan Ruiz Pion

by Marije Braam

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MegaMall Downsized

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Young Professional

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Young Professional or Student?

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Impressions of the Real Estate Career Day 2016

by Arno Ruigrok

by Dirk van Duijn

with Sander Verseput

by Esther Brejaart

Tweets

Den Haag Nieuws @_DenHaag 25 Mar 2016 Update: Vechtpartijen en gewonden bij openstelling V&D #Rijswijk: Warenhuis V&D blijft vandaag gesloten voor h... http://bit.ly/1ZAfLeB

Update: fights and wounded by opening V&D #Rijswijk: Department store V&D will close the doors for today..

James Hall @hallaboutafrica 19 Apr 2016 Plans to expand FourSquare Mall #Johannesburg to 175,000m2 by 2018 will make South Africa’s 2nd largest MegaMall.

follow BOSS on twitter @bosstudelft

Ontime Group @OntimeGroup 19 Apr 2016 91% of shoppers have returned an item bought online due to misrepresentation or sizing error #onlineshopping

George Ratiu @George Ratiu With $1 billion in liabilities & $50,000 in assets, @SportsAuthority is bankrupt and closing 140 #retail stores Retail Event NL @retaileventnl 5 Apr 2016 Retail Tips | Winkels lijken steeds meer op horeca. Je kunt er eten, iets afhalen en bestellen. Instore ervaring is belangrijker dan ooit.

Retail Tips | Shops are more and more like restaurants and cafés these days. It’s possible to eat, take-away and order. Instore experience is more important than ever.

Pieter Post@pdpost 28 Aug 2015 Markthal Rotterdam is finalist in de categorie “Store design of the year” @WorldRetail @WRAwards #retail #innovation

June 2016

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Amadeus

Sphinx ‘De Eiffel’

Event diary

Construction costs: 21 million Realised: 2015 Architect: Mei architects & OeverZaaijer Customer: Gemeente Maastricht Program: Housing, working, leisure, pop up Surface: 35,000 m2 In 2006 sphinx left the Eiffel Building and it became empty.

Construction costs: 65 million Realised: 2014 Architect: Bedaux de Brouwer Architects Developer: Provast and ASR Vastgoedontwikkeling Program: Retail, apartments Surface: 8,000 m2 of shops and 76 apartments In 2013 the construction of this building, which was going to be one of the prominent corners of an important cross in the inner city of The Hague, has started. The ground, first and second floor who consist 8.000m2 are hired by the popular brand Primark. Above the Primark there are 11 floors with in total 76 apartments with lots of variety.

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In response to the commission from the City of Maastricht, Mei architects drew a proposal for the transformation of the building. Now this building is successful renovated and had become a vertical city which houses a new Pathé Cinema and a student hotel. There is also room for leisure, retail and hospitality concepts.

Construction costs: unknown Planned: 2017 Developer: Klépierre Vastgoed Ontwikkeling Program: Retail, horeca Surface: 3,600 m2 On top op of platform 1, 2 and 3 of the station of Utrecht a multi-tenant project will be developed. A big new square, located several metres above grade level with underneath the biggest bicycle storage of the world, will be realised at the place where earlier the Centre Station of Utrecht and the mall Hoog Catherijne were connected to each other. This new place will be called ‘Stationsplein-Oost’.

Retail Pavilion ‘Stationsplein-Oost’

The Dutch Windwheel

Architect: MoederscheimMoonen Architects

Construction costs: unknown Planned: 2025 Architect: DoepelStrijkers Consortium: De Windwheel Corporation Program: Moving cabins, restaurant, houses, hotel Surface: 60,000 m2 The construction of the Dutch Windwheel has to start between 2018 and 2020 and has to be finished by 2025. The Dutch Windwheel will be a showcase for the circular. The building consists of two threedimensional rings with an open steel and glass construction and a high of 174meters.

In 2025 when the building is finished is will probably be the ‘sustainable icon’ of the World Expo.

June 2016

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Book tips by dr. Erwin Heurkens

Published in 1998 by Harper Picador << This is a novel by my favourite American author Tom Wolfe.

The story is set in Atlanta and describes the deterioration of a real estate tycoon in Atlanta. It is a story about power, greed, politics, persistence, humiliation and lots of other themes that you donâ&#x20AC;&#x2122;t learn about at university. It shows the world of real estate is highly competitive, and that sincerity in business and maintaining trustworthy relations are amongst the most important competencies in practice, or elseâ&#x20AC;Ś

If Mayors Ruled the World by Benjamin B. Garber Published in 2013 by Yale University Press

This books argues that cities and its mayors could more effectively combat our biggest challenges such as climate change, migration, terrorism than nation states do. Barber provides you with examples of innovative mayors and governing local-global alliances that could help solve our biggest transnational issues. It is a must read for students interested in politics, democracy and public administration, and ready to explore a new vision on the governance of cities. <<

The New Asian Hemisphere by Kishore Mahbubani Published in 2008 by PublicAffairs

We all keep a close eye on America and Europe, but should really be more interested and inclined in what evolves in Asia. The intrinsic societal values and pragmatic attitude propagated by Asian leaders is something that could help create a more sustainable economy and resilient built environment. You just have to visit Singapore or China to notice the vibe in cities, and read this book to be aware that you are witnessing a fundamental change of power. <<

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BOSS Magazine 56

got a book tip? bossmagazine@tudelft.nl

A Man in Full by Tom Wolfe

Book tip by student Lisa Kuijpers How to Thrive in a World of Too Much by Tony Crabbe Published in 2015 by Piatkus Books

We probably all know that feeling of constant busyness: the battle to keep up with all of our tasks, but somehow always falling behind. That feeling of being unable to finish everything on time and with the desired quality, leaving us with a sense of failure or not being able to take control of our own lives.

In a world of too much, it’s easy to get overwhelmed by all the work, activities and requirements that are thrown at us. There’s nothing wrong with a full and active lifestyle, as long as everything you’re doing truly satisfies you and contributes to your happiness. In his book, Tony Crabbe draws on different psychological studies to explain busyness fenomenons currently occured by many of us. It describes how you can take back control over your career and life, for instance by focusing on making an impact yourself, instead of mainly being impacted by others.

It provides useful comparisons, examples and tips on how to make changes, so you can live your life instead of have your life living you.

<<

Some tips to give you an idea: - Big things first: start off every day with the main or biggest task of that day when your mind is still fresh, the little things you can easily do in the end of the day, small gaps or when you’re tired. This will make you much more effective and efficient.

- Machine-gun your emails: choose a specific time of day to answer all of your emails and don’t look at your inbox for the rest of the day. The same goes for phone-free moments: see how much time this saves you and helps you focus when doing other, more important things.

- Choose ‘hell yes’ or ‘no’: whenever someone invites you for something, choose between ‘hell yes’ if you really want it, and otherwise always say no.

- Your top 15: identify the 15 people in the world whom you like to spend time with most and try to spend more time with them. This will instantly increase your feeling of happiness and help you prioritize your time and relationships.

Erwin Heurkens Erwin is an assistant professor at the TU Delft. He is coordinator of the Urban Area Development Graduation Laboratory.

His publications can be found at www. erwinheurkens.com

Lisa Kuijpers Lisa is a student and started the master track Management in the Built Environment in September 2015. She is also a member of the BOSS Board.

June 2016

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Samsung’s new flagship store in New York City’s Meatpacking district (source: theverge.com)

The battle of online retail and bricks and mortar stores

Manon Feenstra

In a publication in the Dutch newspaper Volkskrant it was concluded that, for the first time, more online shops were observed than bricks and mortar stores. This forces us to reconsider the future of bricks and mortar stores. Is online retail winning the battle?

In tandem with the disappearance of domestic Dutch bricks and mortar stores, such as V&D, Macintosh and smaller retailer DA Drogist, it highlights that the future of retail is changing. The announcements of their bankruptcies have shifted the retail space market in the Netherlands as it caused a significant rise in retail vacancy levels according to the retail market snapshot of Cushman and Wakefield. Is it too early to state that this is the end of the bricks and mortar store of today?

It is likely that most of the Dutch domestic stores will remain open for a while; multiple companies are interested in taking over (parts of) the stores. However, the retail snapshot states that despite a small growth in retail sales

“The technology, that introduced people to online shopping, has changed consumer behaviour rigorously. (...) We no longer have to stroll through crowded shopping streets, deal with intrusive salesmen and be disappointed if the product we want has run out of stock.”

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“A lot of online retailers actually go offline.

Take for example Zalando who owns a fashion store in Berlin. Also Amazon.com has put foot in key shopping areas. Apparently, the traditional brick and mortar shop fulfills consumer preferences that an online shop cannot.” last year, the downward pressure remains in the majority of shopping centre locations. Should we worry already?

The technology, that introduced people to online shopping, has changed consumer behaviour rigorously.

Firstly, online stores are available whenever you wish to shop and you can get any information you want. People seem to have gotten used to the ease of purchasing products through e-commerce. Secondly, some articles state that technology will eventually even replace the physical shopping experience. As virtual reality becomes more common, they state that the future of retail is associated with “virtual shopping”. It means walking, trying out products and fitting clothes in a virtual world. We no longer have to stroll through crowded shopping streets, deal with intrusive salesmen and be disappointed if the product we want has run out of stock.

Yet, I feel it would be going too far to say that online retail is winning this battle. A lot of online retailers actually go offline. Take for example Zalando who owns a fashion store in Berlin. Also Amazon.com has put foot in key shopping areas. Apparently, the traditional brick and mortar shop fulfills consumer preferences that an online shop cannot. It appears that, according to a research of ABN AMRO, consumers still want to shop in-store.

It seems like multinational companies know what the future brick and mortar store should look like. Last February, Samsung opened a retail outlet in Manhattan’s Meatpacking District, America. Consumers may try on the new VR headset and other products. People do not walk out the store with the new Samsung Galaxy phone or other products; They will buy the products

online because consumers know how to and they often even receive the product the next day.

This means that bricks and mortar stores in key shopping areas do not function as the main sales point for retailers, but as a brand advertisement. As ABN AMRO also mentions in their report about the future of retail, especially in inner cities, it is more about the shopping experience itself. Urban Outfitters and Bonobos for instance use clothing samples to advertise for their brand and products. With high real estate costs in key shopping areas, precious space on on-site stockrooms will not be wasted.

Meanwhile, online marketing is becoming increasingly expensive. Social, Adwords and display-advertising could have a big impact on purely online retailers.

I don’t think online retail will be the big doomsday technology that many people predicted. It is not the end of the traditional bricks and mortar store. However, it seems that we have reached a point where it should be acknowledged that online retail and its rapidly developing technology is changing the traditional Bricks and Mortar store and the way we experience shopping. Since this is a battle, I have to announce the winner: AND THE WINNER IS …

Wait, we have a tie!

Manon Feenstra Manon is a student and started the master track Management in the Built Environment in February 2015.

June 2016

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To blur or not to blur? KEK Coffee & Crafts Delft Astrid Potemans in an interview with Leonie Hulselmans, owner of KEK Blurring, combining retail with nonretail, is a concept that is becoming increasingly visible the city centre of Delft. We had the opportunity to interview young entrepreneur Leonie Hulselmans, owner of KEK, a hybrid of a concept store, an espresso bar and lunchroom on the Voldersgracht. In almost three years’ time, KEK has grown to become a very well-known place in Delft, employing a group of thirty coffee and food enthusiasts. However, the initial concept has remained unchanged.

“KEK revolves around high quality coffee and gifts, presented in an atmosphere that might as well be your own living room”, as Leonie puts it.

The concept of blurring is not the golden key to success.

To be able to blur, one requires permission from the municipality to deviate from the land-use plan. KEK indeed obtained permission from the local authorities of Delft but nevertheless forms an exception to the rule.

“As a manager, I am never focused on but one thing. I run a café and simultaneously a store. Restocking of the store needs to be done after opening hours.” One may wonder: why blur? “The café and the store reinforce one another. Most of the interior is for sale, but it does not have to be sold in order to make a profit. That is a luxury.”

Leonie studied Public Administration at the University of Amsterdam but the thought of spending her days in a business suit on the South Axis far from appealed to her. After obtaining her Bachelor’s degree she decided to travel to Australia. The great variety of coffee bars she visited down under inspired her – each single one of them had its own theme, its own character. She felt like this was something that was lacking in the Netherlands. When Leonie was back she spotted a place for rent – she presented her business plan in PowerPoint format to the landlord and he decided it was worth the shot. And so KEK came to life.

frequently. I wouldn’t say that specific theories have proved to be useful, rather my studies have given me a more open attitude. They have given me the ability of looking at things from different perspectives.”

What will the streets of Delft look like in ten years’ time?

According to Leonie, the focus will be on ‘experiences’.

“Clients should be excited by new concepts and combinations of different functions. Shops will revolve around themes rather than products. Most people will not leave their house to buy just practicalities. People leave their house to get away for a bit and to socialize.”

In the book Retailing in the 21st Century, Uncles (2006, p. 168) states that customers “want pleasure from the activity of shopping, which means the atmosphere and ambience must be appropriate and certain standards of service must be met (…), activities are blurred into an unfolding set of interrelated experiences.”

Leonie believes the city centre of Delft will become increasingly compact but also more diverse, with a strong focus on the aforementioned ‘experiences’.

“When I came here,” Leonie explains “the Voldersgracht was quite a challenging street”. Now also Pleck and INSTORE have made its entrances and soon De Centrale Delft will open its doors. However, KEK remains a hotspot in the street. The success of KEK is due to a multiplicity of factors. “The reason I was able to open KEK in the Voldergracht in the first place was thanks to the landlord, who was actively involved in the development of the concept. The amount of rent gradually increases in the first five years (‘ingroeihuur’), enabling KEK to grow.” But the most important factor of any business is not the choice to blur or not to blur, it is strategic focus and enthusiasm.

“It will only work if it really suits you. Be enthusiastic about your business, and above all carry it out!”

References

Indeed, Leonie did not end up on the South Axis, but are her academic knowledge and skills nevertheless useful in practise? “I have thought about this

Uncles, M. D. (2006). Understanding Retail Customers. In Krafft, M. & Mantrala, M.K. (Eds), Retailing in the 21st Century. Current and Future Trends (pp. 159-173). Berlin: Springer.

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DEBATE Dutch central government should create one national

The spatial differences in retail vacancy are big.

Especially Groningen, Friesland and South-Limburg have high vacancy rates. The average vacancy in the Randstad is lower (PBL, 2015), though the differences within the Randstad are big. With the increase of internet shopping, smaller retail centres lose customers.

The larger centres develop into leisure shopping areas, with increasing supply (Locatus, 2015). Van der Wal, Kooijman and Remøy (2015) described the importance of 1) location characteristics to attract customers and 2) building characteristics to attract retailers. Presence and quality of anchor stores, retail mix, centre size, accessibility and parking, and atmosphere are the most important area characteristics. Location, ground floor, size, function of surrounding objects and frontwidth are the most important building characteristics.

The area characteristics are important for attracting customers, and hence are denominators for vacancy.

Within the area, the building characteristics are Hilde Remøy Hilde is an associate professor of Real Estate Management at the TU Delft and has completed her PhD dissertation ‘Out of Office’ in April 2010.

indicators for where vacancy occurs. As simple as it might sound, policies to enhance retail centres and reduce vacancy should focus on improving the most important area and building characteristics. The place of a centre within the hierarchic structure of retail centres should be taken into account when considering adjustments to the retail structure. According to Van der Wal (2015) middle-sized cities cannot compete with the large city centres for recreational shopping, and need to decrease their retail supply – the current supply is simply too large.

In such centres, the so-called waterbed effect should be taken into account: improving properties somewhere causes problems elsewhere in the centre. Vacancy influences the atmosphere in a centre negatively, since it worsens the image and feeling of safety. Moreover, gaps in the retail structure result in an unclear routing and reduced spillover effects on surrounding objects.

Hence, vacancy can cause a negative spiralling development of the area. Considering this, it might be preferable to aim for a more compact retail centre.

Transforming (parts of) the retail area could give solace.

in favor

IN FAVOR The Netherlands has one of Europe’s highest retail space densities per capita: 1.8 m2 per inhabitant, i.e. 30 million m2 in total (ING, 2016). Between 2004 and 2015, more than 4 million m2 were added to the stock, and judging by municipal plans and policies, more is coming.

The retail vacancy in the Netherlands has increased significantly over the last 5 years, to more than 9 % of the total supply, i.e. 2.8 million square metres (PBL, 2015). The consequences of recent retail bankruptcies are not yet clear. Considering the prominent role of retail for the liveability of cities, a national strategy is needed to tackle this issue.

Good management of city centres does not reduce the size of the vacant retail stock. Coordination is needed, and can best be organised on regional or national level. Reducing vacancy means to reduce the retail stock by reorganising, redeveloping and transforming existing retail space into new use. The national office covenant from 2012 gives an idea of how this can be done. Cooperation between governments on different scales and a broad range of market parties are essential. All stakeholders must take responsibility and be willing to share the pain and the gain; a positive value development is possible, but requires investment.

There is one problem that needs to be solved. No matter which strategy is chosen for dealing with retail vacancy, choices must be made: which retail centres to reduce or transform, and which to keep as retail centres.

Therefore, a national strategy is necessary and a national governmental body is needed to steer the development. >> The list of references of this article can be found on page 16

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strategy to tackle the increasing vacancy rates of retail spaces

The emergence of online shopping is fundamentally changing the character of our high-streets. As one of the most avid online-shoppers I am the last person to deplore the demise of retail enterprises such as V&D, Perry Sport, Macintosh, and Manfield. I do 90% of all my own and my familyâ&#x20AC;&#x2122;s shopping online. Groceries are delivered once a week by AH.nl, books are provided by Bol.com, shoes are shipped by Zalando, and my clothes come from Suitable or from my personal shopper Romy at The Cloakroom. If I had the money I would even order my car online at Tesla.

Judging by the number of retail chains in distress and the number of empty retail spaces I am not the only one.

The retail industry is now reaping what it sowed over the past decade. After more than thirty years of rather restrictive national government policy for retailers, the 2004 National Spatial Strategy (Nota Ruimte) abandoned this restriction to make room for a more dynamic economy. The responsibility for spatial planning was devolved to local and regional authorities.

Entrepreneurs were delighted, especially investors in retail real estate. Deregulation led to oversupply of retail. Now the retail industry is faced with a struggle for survival, leading to sharper contrasts between highand low-demand shopping areas. The retail industry calls for government action, including bringing down the

operating expenses of retailers by lowering local and national taxes. It is an attempt to keep private profits private, but make private losses public. It is not the responsibility of governments (national or local) to support these struggling enterprises; their responsibility lies in addressing the impact on the built environment of this transformation.

against

AGAINST The Dutch excel in calling for government action to ameliorate the tragedies of life. In 2013 a humpback whale beached on Texel, one of the Dutch isles. The poor animal, nicknamed Johanna, did not survive. The alleged suffering and death of the animal triggered public outrage and the government felt compelled to draft a protocol in case other whales would strand alive on Dutch shores, the Protocol stranding levende walvisachtigen, a tokenistic government action, grossly overestimating the ability of the state to change reality.

The call for government action is not limited to animals (or people), but also to enterprises. Now some commentators call for a national strategy to tackle the increasing vacancy rates of retail spaces in the country. In my view this is another, but metaphorical, attempt to save a beached whale.

Local authorities need to adapt their spatial planning strategies to make shopping areas vibrant and attractive places. The demise of the mono-functional traditional high-street is a blessing in disguise. The characteristics of retail outlets need to change and become more intertwined with other functions such as combinations of shops and restaurants, housing, care concepts and flexible workplaces. The role of the national government should be limited to providing the (legal) tools that localand regional authorities need. There are already many instruments available, local authorities could develop regulation to address vacancies based on the 2010 Squatting and Vacancy Act (Wet Kraken en Leegstand).

Room for market dynamics is why retail entrepreneurs, property owners and real estate developers applauded the introduction of the Nota Ruimte in 2004. Market dynamics is what they need to address in 2016. In order to prevent becoming a â&#x20AC;&#x2DC;beached whaleâ&#x20AC;&#x2122;, they need to wake up and face reality. Local authorities can help them in this reality check by taxing vacant retail spaces to accelerate transition, forcing property owners to adopt faster to changing market conditions and offer more attractive and more flexible rental conditions.

Gerard van Bortel Gerard is associate professor Housing Management at the TU Delft and recently promoted on the role of housing associations in neighbourhood regeneration.

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References debate Hilde Remøy (pp. 14) ING (2016). Winkelleegstand van meer dan 10% dreigt. ING Economisch bureau. Retrieved from www.ing.nl, retrieved on May 4th, 2016.

Locatus (2015). Winkelleegstand in Nederland niet toegenomen in 2015. Retrieved from http://www.locatus.com, retrieved on May 4th, 2016.

PBL (2015). Compendium voor de leefomgeving, leegstand van winkels 2004-2015. Retrieved from www.compendiumvoordeleefomgeving.nl, retrieved on May 4th, 2016.

Van der Wal, L. (2015). Retail vacancy in inner cities: the importance of area and building characteristics. MSc thesis, Real Estate & Housing, TU Delft. Available from www.repository.tudelft.nl Van der Wal, L., Kooijman, D. & Remøy, H. (2015). Levendige winkelgebieden met uitgebalanceerde kwaliteit.

Rooilijn (48) 6.

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Bigger IS better: Retail consumption and its effect on real estate in India Malvika Mundkur Now more than ever, India is being recognized for its potential in real estate development.

Retail consumption of tech and luxury goods is only increasing with the increased spending capacity and awareness of the country’s youth.

This trend has maintained the interest of retail investors, both foreign and domestic. Global fashion brands and lifestyle stores are drawn to set up shops in India, owing to the new government opening its gates to 100% FDI (Foreign Direct Investment) in single brand retail.

Since this foreign investment reform in 2012, brands such as IKEA, Walmart, H&M, Gap etc. have been flooding the market, eager for a stake in India’s promising future. This has resulted in increasaed competition, making developers strive to supply bigger and better shopping experiences that make them stand out.

However, this fairly evident development in retail real estate is not reflective of the growth of online shopping.

Both markets have been growing exponentially, and have somehow managed to sustain their position, despite the presence of the other. It can only be assumed that shopping is viewed more as an indulgent experience amongst the wealthier class of society, making malls more of a lifestyle destination than just retail. Consumerism as a trend is fuelled because shopping has become synonymous with festivals; and there is no dearth of festivals in India.

Take for example the tech capital of the country: Bangalore. Bangalore has long been a test market for developing ideas and pioneering initiatives. The city has witnessed the emergence of the first few shopping malls in the country, and as recent as 2015 has opened its largest lifestyle destination VR Bengaluru: 140.000 sqm. of retail, entertainment and leisure. It is curious that the development even shares a common wall with an equally successful shopping mall: Phoenix Market City, spread across another 130.000 sqm. This may be regarded as

excessive, since both malls house similar brands. But surprisingly, in a country where demand outstrips supply, both developments are equally successful and popular.

India’s growing reputation for business and investment has boosted the emergence of several such lifestyle destinations across the country. A weekend out in any city says more than any numbers could: shopping malls are teeming with customers, brands open as many as four outlets in the same neighbourhood to cater to supply, and the malls are only getting bigger. Weekdays are not much worse off either, the only difference being that foot traffic is concentrated in the evening hours.

“Consumerism as a trend is fuelled because shopping has become synonymous with festivals; and there is no dearth of festivals in India.”

In a country where 65% of the population is below 35, there is a burgeoning demand for venues to satisfy these young spenders. A foreseeable problem would be the lack of land or space for new venues. It is evident that the difficulty in India will not be shopping malls becoming obsolete, but a strained real estate market barely keeping its head above the water with the ever increasing demands for quality lifestyle developments.

Malvika Mundkur Malvika is an international student from India. She started with the master track Management in the Built Environment at the TU Delft in September 2015.

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Evolution of Chinese retail market in a new economy Wenhan Hu Housing prices have surged in major Chinese cities, the most restrict housing policy and home purchase restrictions have been released since 2010. This had led to the fact that most investors and developers turned towards the retail market. Now China has become the worldâ&#x20AC;&#x2122;s second largest retail market. According to data from Knight Frank and Holdways (2015), although the total stock of prime shopping centers in seven major Mainland cities grew 9.8% year on year to reach 39.5 million square meters during the first half of 2015, five of the seven major cities recorded falls in vacancy rates, compared to the same period last year. The growth momentum was relatively robust in the first half of 2015, thanks to the strong market in Chinese stocks.

However, the situation sank in the second half of the year, due to the economic downturn and the growth of the retail market in China is slowing down compared with previous years (Euromonitor International, 2016).

In the first half of 2015, the total value of retail sales in China reached RMB 14.2 trillion (around 2 trillion Euro), while the per-capita consumption expenditure of urban households was RMB 10,401 (1,486 Euro) (Figure 1). It is undeniable that the Chinese retail market is experiencing rapid evolution in a new economy.

Macro environment The challenge of decreased consumer confidence and the competition from internet retailing, had its impact on store-based retailers in 2015. A large number of stores closed in various channels, ranging from hypermarkets and apparel and footwear specialist retailers to department stores (Euromonitor International, 2016).

Besides, most Chinese developers donâ&#x20AC;&#x2122;t know what they want. They develop a building based on trends without market research (Paar & Loesser, 2016), leading Figure 1: China retail sales value and percapita consumption expenditure of urban households (source: National Bureau of Statistics of China / Chinese Academy of Social Sciences, 2015)

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to over-development and homogenization of Chinese commercial market. The rising operational costs from rents and labour is another crucial reason resulting in store closure. Yet, it is noticeable that Chinese consumers are reducing expenditure proportion on consumer goods and other living necessities, because of improvement of life quality. They spend more on products and services related to transportation, communication, culture, education and entertainment (Figure 2).

Current market Shanghai recorded the highest retail sales value among Chinaâ&#x20AC;&#x2122;s major cities during 2015, followed by Beijing.

Meanwhile, retail sales in Hangzhou grew at the fastest pace (21.0% year on year), followed by Chengdu (16.2%) and Shanghai (15.5%). In the first half of 2014, Beijing took over Shanghai to have the largest amount of prime shopping centre amount among the seven major Chinese cities, with a total of 9.35 million square meters and 1 million square meters growth compared to 2014. The average amount of stock in first-tier

Figure 2: Resident Expenditure Breakdown Movement by Category (source: Kantar Retail, 2014)

cities (Beijing, Shanghai, Guangzhou and Shenzhen) reached 7.45 million square meters (6.8 million square meters in 2014) and in second-tier cities (Hangzhou, Tianjin and Chengdu) 3.24 million square meters (2.9 million square meters in 2014) (Figure 3 on next page).

Retail market has been increasing its contributing to the total retail sales growth in lower-tier cities as rural consumers generally hold stronger confidence than their urban counterparts. Residents in lower-tier cities are buying more as the income gap between rural and urban residents narrows (Kantar Retail, 2014). Continuous outlet expansion and penetration into lower-tier cities are with huge potential demand.

Many brands preferred to open stand-alone stores in order to promote the shopping experience, with wider ranges of products and more professional services.

The availability of groceries has spread from traditional grocery retailers to a wide variety of channels, especially internet retailing (Euromonitor International, 2016).

Vacancy rate & rent price The vacancy rate in Hangzhou’s high-end shopping centres remained the lowest among China’s seven major cities, while the highest vacancy rate was recorded in Chengdu. The average vacancy rate in

China’s first-tier cities reached 6.5%—1.8 percentage point lower than that of second-tier cities (Figure 4).

Among China’s seven major cities, Shanghai remained the most expensive city to lease prime shopping centre space. The average monthly rent in first-tier cities reached RMB 1,551 (around 222 Euro) per square meter—49.3% higher than the average RMB 1,039 (148 Euro) per square meter in second-tier cities (Figure 5).

Market trends Recent years, the Chinese government is paying effort to shift the existing outward-bound economic model, towards a more domestic consumptiondriven one with a view to fostering sustainable economic growth in the future (Kantar Retail, 2014).

1. Expansionary monetary policy China is eager to transform its economic model from manufacturing and investment-driven to consumerdriven. Therefore the Central Bank announced a series of easing policies in late 2014 including lowered interest rates and relaxed loans. Such policies are expected to relieve capital pressure for businesses and improve domestic consumption.

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Figure 3: Existing stock of prime shopping centres in 1H 2015 (source: Holdways in Knight Frank, 2016)

2. Government crackdown on corruption and official extravagance The campaign was led by Chairman Xi with solid execution, significantly reducing consumption by civil servant, influencing on the sales of gift cards and premium goods to a substantial degree.

leisure activities for Chinese consumers. According to China Business News (2014) 68% respondents are using online shopping. 44% respondents expressed that most of the time they buy things online, but sometimes they also go to shopping mall/store. Only 4% respondents indicated that they only go to shopping mall/store.

3. Relaxed one-child policy This policy will likely change the structure of many Chinese families and bring huge opportunity for the childrenâ&#x20AC;&#x2122;s industry while it also impends to non-baby consumer packaged goods manufacturers. Households may cut down spending on other consumer goods, due to the growth of cost on child care.

In the future, the combination of online and offline will be the trend. Increasingly popular E-commerce websites were established such as Taobao, Yihaodian and Jingdong, etcetera. Taobao, as the most popular website, facilitates consumer-to-consumer (C2C) retail by providing a platform for small business and individual entrepreneurs in China (Shanghai Daily, 2008). Because of the success of E-commerce, many retailers also create Business-to-consumer (B2C) sites to leverage existing offline resources and expand the business to city downtown and rural areas (Kantar Retail, 2014). It is noticeable that though most people continue to shop online at websites, most of the consumers are also using smartphones or tablets for shopping. The wide adoption of smartphones and tablets creates an opportunity for retailers to keep a connection with consumers through apps. The apps are integrated with various functions like releasing promotional information, coupon distribution and mobile payment, which acts as an efficient way to build shopper loyalty (Kantar Retail, 2014).

4. Shanghai free-trade zone The free-trade zone will benefit to foreign brands to enter the Chinese market by reduction of duty and logistics. However, it is possible that brands suffer from fierce competition.

With the development of internet and information technology, the flourish of E-commerce became the most important competitor to traditional retailers. Chinese consumers are looking for enhanced convenience, security and quality, as well as innovative products and services. Therefore internet retail and E-commerce are the trend and play an important role in retailing, not only for non-store based retailers, but also for traditional store-based retailers in China (Euromonitor International, 2016). Online shopping has become the mainstream 20

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Conclusion Though the increasing pace of Chinese economy is slowing down, the rent of Chinaâ&#x20AC;&#x2122;s retail market as well

as the number of new shopping centres will still grow in the major Chinese cities. Facing the changing retail market at a time of economic uncertainty and rapidly changing consumers, online shopping is the biggest challenge for traditional retailers, but is also a possibility for them to reform their operation to survive. Meanwhile, newly-released policies are also a good promoter for all retailers to seize the opportunity in these new economic times. All in all, it is necessary to keep an optimistic attitude cautiously on the Chinese retail market for the next few years.

References China Business News. (2014). The change of Chinese consumer behaviors in 10 years.

Retrieved from Hongyuan Group: http:// www.hongyungroup.cn/html/201411/ a419.htm Euromonitor International. (2016).

Internet Retailing in China. Retrieved from ReportLinker: http://www.reportlinker. com/p02897422-summary/InternetRetailing-in-Hong-Kong-China.html Euromonitor International. (2016). Retailing in China. Retrieved from Euromonitor International: http://www.euromonitor. com/retailing-in-china/report Kantar Retail. (2014). China Retail Market at its Tipping Point.

Knight Frank. (2014). China Retail Property Market watch.

Knight Frank. (2015). International luxury brands adjust price to boost sales in China; Fast-fashion vrands massively expand e-commerce. Retrieved from Knight Frank: http://www.knightfrank.com.cn/ en/news/international-luxury-brandsadjust-price-to-boost-sales-in-china;fast-fashion-brands-massively-expand-ecommerce-06803.aspx Knight Frank. (2016). Reduction of China retail market caused by slowing down of Chinese economy. Retrieved from Sina: http:// jiaxing.house.sina.com.cn/news/2016-0324/12496118629551385146901.shtml?wt_ source=sy_ljtj_xw Shanghai Daily. (2008). Taobao.com launches online shopping mall. Retrieved from China. org.cn: http://www.china.org.cn/ english/business/239421.htm

Figure 4: Vacancy rates of prime shopping centres in 1H 2015 (source: Holdways in Knight Frank, 2016)

Figure 5: Monthly rents of first floors of prime shopping centres in 1H 2015 (source: Holdways in Knight Frank, 2016)

Wenhan Hu Wenhan is an international student from China. She started with the master track Management in the Built Environment at the TU Delft in September 2015.

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Redefining vacancy: from ‘Forbidden City’ towards ‘Creative City’ Roger Broersma & Tim Maier (SDK Vastgoed, Park Strijp Beheer, VolkerWessels iCity) The city of Eindhoven has undergone an important transformation from an industrial city towards one of the leading high-tech hubs of Europe. Eindhoven has created a diversified economic structure with high-tech systems and materials. This transformation process has been highly influenced through its connection to its historical identity and the smart urbanisation and regeneration of former industrial sites. An important catalyst in this transformation process is the redevelopment of the former industrial area Strijp-S. It was transformed from a ‘Forbidden City’ into a ‘Creative City’.

Throughout the Netherlands, large companies contributed significantly to the development of industrial sites that influenced the morphological footprint of the city. Different social and financial aspects, such as the global migration and the economic crisis, contributed to the abandonment of these industrial sites, so-called brownfields. Besides this, the vacancy in the Netherlands also increased through a shift from products to services in the Netherlands. For example, the mining industry in the south of the Netherlands and the light bulbs of Philips.

Due to the location and the high potential development opportunities of these sites, the creation of a knowledge 22

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economy characterised by an intensity of globalisation and an accentuation on human capital, the development of these cities could have a major influence on the future development of the city (Boterman & Sleutjes, 2014). In order for cities to move within the international dynamics and economic cycles, policy makers and developers are continuously trying to develop initiatives and strategies in which cities increase their competitiveness by attracting or retaining people who work in creative and knowledgeintensive sectors. Subsequently, they try to improve their international position (Akcomak, I.S.; Borghans, L.; ter Weel, 2011). According to the European Union (1996) in

2030 more than 80% of the global population will live in cities. Due to existing urban conglomerations and planning policies, new developments of greenfield sites are becoming more and more complex and restricted (Myers & Wyatt, 2004).

As stated before, a suitable solution can be identified in the debate of the regeneration of Brownfield sites. A key indicator that illustrates the importance and possibilities of the transformation of a brownfield site, is Strijp-S in Eindhoven.

“Strijp-S was developed by Philips in the early 20th century [as a part of] Philips Strijp complex that also consists of the “T” and “R” sites. It was considered as an industrial city of Philips with a complete independent infrastructure, known as the ‘Forbidden City’ due to the strict accessibility policy in order to protect developments and inventions.”

Strijp-S was developed by Philips in the early 20th century. The area Strijp-S, with a size of 27 ha, is part of the Philips Strijp complex that also consists of the “T” and “R” sites. It was considered as an industrial city of Philips with a complete independent infrastructure.

It was known as the ‘Forbidden City’ due to the strict accessibility policy in order to protect developments and inventions. During its economic peak it housed 15,000 to 20,000 workers. In the early 1990’s a turning point occurred through international competitiveness, causing Philips to return to its core business and to implement a large scale-restructuring program. Consequently, production units were reduced through closure or relocation to low cost countries (Van den Berg, Braun, & Van der Meer, 1997). For the city of Eindhoven, this resulted in refocusing on fewer strategic locations, such as HTC/e, Philips Business Park Eindhoven, and Philips Lightning. Subsequently, other locations were closed. In 2000 Philips decided to dispose the industrial complexes of Strijp-S. Through a market consultation conducted by Philips in 2001, VolkerWessels was elected as a project developer. Through decisive experiences with a public private partnership with the municipality and the project Paleiskwartier in Den Bosch, VolkerWessels decided to conduct the same partnership with the municipality of Eindhoven. In 2002 VolkerWessels Stevin N.V bought Strijp-S from Philips. This participation resulted in the establishment of Park Strijp Beheer BV in which the objective was formulated to develop the area of Strijp-S together in which both parties are 50% shareholder.

After Philips had restructured its assets it would leave the area in stages (Harms, 2007). In 2002 Adriaan Geuze made the development plan for the area with his firm West 8 and in 2005 the final urban plan was adopted.

The office West 8 is the supervisor of the area and is responsible for safeguarding the quality of the area (Prius, 2008). For the future development of Strijp-S, VolkerWessels sought partnerships with the housing corporations Trudo and Woonbedrijf, because of to their expertise and knowledge of the regional context (Prius, 2008). Their participation has been (and still is) one of the key success factors for the development of Strijp-S. The uniqueness, the size, the location, the regulations and the involvement of various stakeholders composes the complexity of one of the largest redevelopment project of the Netherlands. This complexity was translated into a concept that can be traced back to the historical identity of the area. The DNA of the area is imbedded in the history of the area, the aesthetics of the buildings, the public awareness and place identification of the inhabitants. The master plan consists of three central themes: technology, design and culture (including urban

Roger Boersma Roger is a trainee at VolkerWessels ICity and is daily involved in the development of smart city Strijp-S.

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“The aim is to transform the area into a multifunctional area, labelled as ‘Creative City’ (...) in which there is an intertwined diversity of functions that consist of a combination of living, working, cultural and recreational facilities.”

sports) – that refer to the historical identity. The aim is to transform the area into a multifunctional area, labelled as ‘Creative City’.

A more specific aim was stated by KuiperCompagnons (2007): “the best practice of an historical important industrial complex into a dynamic post-industrial city district, in which culture and technology play a key role”. This is done through the creation of a sub urban area in which there is an intertwined diversity of functions that consist of a combination of living, working, cultural and recreational facilities. Within the spatial planning there is also emphasis placed on the potential to attract or retain certain knowledge workers and artists.

Strijp-S will be a dynamic metropolitan urban area that houses a diversity of functions. Through a dynamic environment there should be a close interaction between the residents, businesses and visitors. The target group consists of the combination of the small and medium businesses and the ‘creative class’. The proposed planning offers room for flexibility, through the possibility to shift between the functions and the amount of square meters as long it meets the requirements of the defined regulations sets. Therefore, the planned master plan consists of a diversity of functions: • Residential space: 285,000 m2 • Offices: 90,000 m2 • Commercial/culture: 30,000 m2 • Optional: 30,000 m2.

An important aspect, within the regeneration of the area is the transformation of the existing buildings.

Many buildings that are located on the Strijp-S area

Tim Maier Tim is a graduate student at the TU/e and is an intern at SDK Vastgoed.

He is daily involved in research about office development Strijp-S.

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have a monumental status and therefore only allow slight adaptions. This contributes to the preservation of the historical identity. Another important aspect is the planning process in relation to creating the awareness of the area. In order to attract the defined target groups it was decided to maintain the raw industrial character of the area until 2008. At the same time, urban culture functions were added to the area. This resulted in attracting early adopters in the area. After this period, the creative scene established themselves surrounding these activities. Therefore, the next phase was characterised by the construction of new residential buildings and cultural functions in order to attract the early majority. Currently, the final phase consists of attracting the late majority through the mix of functions.

The redevelopment of Strijp-S is a complex process in the built environment for a number of aspects. The first aspect that composes the complexity is the amount and diversity of regulations that are imbedded in an area as Strijp-S. The built environment can be characterised as a multidisciplinary environment. Within this environment there is a conflict of interest between the stakeholders that are involved in the negotiation process. On the one hand there is the property owner’s reluctance to reveal contamination potential because of liability fears and on the other hand the collaborative environment between the public and private sector that is categorized by the lack of consensus amongst key stakeholders. Thirdly, the overlap between the past, present and functionality is creating a complex time period of redevelopment. For example, from the start of the redevelopment process Philips left the area in different phases. This created an increasing pressure on the transformation process, the construction of new projects, and the financial feasibility.

Furthermore, within the redevelopment process several

contemporary functions (events) are mixed with new functions (such as housing) and it is difficult to predict the outcome. Another important constraint that affected the planning process and the financial feasibility is the impact of the financial crisis. This resulted in the situation that investors had limited resources and therefore important investment decisions, such as the development of phase IV, were postponed. The postponement of phase IV resulted in the decision to maintain the housing of the small and medium business in order to stimulate the financial feasibility and attractiveness of the area.

Even though the redevelopment of Strijp-S consists of a range of complexities, from the start of the redevelopment process a numerous amount of benefits can be identified. These benefits consist of economic, social and environmental benefits, such as a higher quality of life, provision of land for housing or commercial purposes, creation of employment opportunities and especially the reduction in the pressure on urban centres. Throughout the redevelopment process a mix of residential functions, cultural functions, events and initiatives of tenants have created a viable and creative metropolitan area. It is an area where culture, business and innovation go hand in hand. Especially,

the importance of the cultural amenities cannot be overestimated. In order to attract the creative class their awareness and identification is highly influenced by projects and creativity in the area. For example, the presence of urban culture functions (so-called pioneers) and cultural activities (DDW /Glow / STRP) played an evident role in the attractiveness of the area. Through the festivals DDW, Glow and The Flying Dutch, Strijp-S was visited in 2015 by 1.7 million visitors. And through monthly recurring events there is a continuous stream of visitors to the area. As a result of the developments in Strijp-S, the area was nominated for the Gulden Feniks award in 2013 (ED, 2013). Next to this, against the market forces, in the last 5 years more than 110,000 square meters have been leased. More specifically, Strijp-S consists of approximately 700 companies, from small to large. At the moment, 1,000 housing units are under construction and approximately 1,500 homes will be constructed.

Innovation is one of the key elements in Strijp-S. In 2015 the city of Eindhoven has submitted a Smart City proposal in collaboration with the cities of Manchester (UK) and Stavanger (Norway) for the Smart Cities Call Horizon 2020, which was issued by the European Commission. This proposal was granted and resulted in the â&#x20AC;&#x153;Triangulumâ&#x20AC;?

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partnership. The partners in Eindhoven are smart city developer VolkerWessels iCity, Park Strijp Ontwikkeling, Woonbedrijf, KPN, Technical University Eindhoven and the municipality of Eindhoven. The Triangulum project is also known as the three point project (demonstrate, disseminate, replicate) and demonstrates how a systems innovation approach, based around the European Commission’s Smart City and Communication (SCC) Strategic Implementation Plan (SIP), can drive dynamic smart city development. The project tests the SIP across three lighthouse cities: Eindhoven, Manchester and Stavanger, which represent the main typologies of European cities. These cities will be complemented by the follower cities: Prague, Leipzig and Sabadell. This powerful combination reflects an urban population of between 100k and 1.2m inhabitants across six different countries, allowing the project to demonstrate successful replication across a wide range of typical urban areas in Europe. Each city has already made significant progress towards the transition of becoming a smart city by developing their own individual approach reflecting specific local circumstances. These inherent strengths serve to accelerate the smart city development across the proposed demonstration sites within Triangulum.

The Triangulum goals target a series of direct impacts around; reduced energy consumption of buildings, increased use of renewable energies, increased utilisation of electric vehicles, deployment of intelligent energy management technologies and the deployment of an adaptive and dynamic ICT data hub. The design

and implementation of innovative Business Models and the activation of citizens as co-creators are core cross The Triangulum Project cutting elements to base the technologies in real-world city environments and facilitate replication. Strijp-S functions as one of the living labs from Triangulum. During the project start-ups and SME’s will be asked to develop innovative solutions which can be implemented in smart city Strijp-S. The main goal is not to develop smart city solutions which are specific designed for Strijp-S, but to develop generic and replicable solutions which can be scaled and replicated into other cities. A tender which challenges start-ups and entrepreneurs to develop innovative products and/or services will be launched in the summer. More information about the Triangulum project can be found on the following page: www.triangulum-project.eu

References Akcomak, I.S.; Borghans, L.; ter Weel, B. (2011). Measuring and Interpreting Trends in the Division of Labour in the Netherlands.

40–45.

CPB Discussion Paper, (161), 435–482. http://doi. org/10.1007/

KuiperCompagnons. (2007). Bestemmingsplan Strijp-S. Rotterdam.

s10645-011-9168-3

Prius, R. (2008). Herbestemming van Industrieel Erfgoed. University

Boterman, W. R., & Sleutjes, B. (2014). Urban Regions in the Delta: Stated residential pref- erences of higher educated workers in Amsterdam and Eindhoven.

ED. (2011). Regio Eindhoven de slimste ter wereld. Retrieved from http:// www.ed.nl/economie/regio-eindhoven-de-slimste-terwereld-1.2046083, retrieved on March 16th, 2016.

ED. (2013). Strijp-S genomineerd voor Gulden Feniks. Retrieved from http://www.volkerwessels.com/nl/nieuws/detail/strijp-sgenomineerd-voor-gulden-feniks, retrieved on March 16th, 2016.

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Harms, E. (2007). Transformatie Strijp-S. Real Estate Magazine, 52,

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of Amsterdam.

Van den Berg, L., Braun, E., & Van der Meer, J. (1997). Metropolitan Organising Capacity - Experiences with Organising Major Projects in European Cities. Ashgate Publishing Limited.

Van Winden, W., Van den Berh, L., Carvalho, L., & Van Tuijl, E. (2010).

The role of manu- facturing in the new urban economy. Routlegde.

Saving the inner city center Joan Ruiz Pion You couldn’t have missed it: the bankruptcy of retail brands such as V&D, Macintosh, Schoenenreus, etcetera. This has led to the vacancy of numerous stores throughout the Netherlands. For Dutch municipalities, vacancy in their inner city center is a big problem as it has consequences regarding the livability of their city. Vacancy is detrimental to the quality of the living environment; it can come at the cost of safety and can make the city less appealing to outsiders. This can be a deathblow for municipalities in a time in which cities are competing for (high educated) residents and publicity. This makes you wonder: what can municipalities do to tackle these problems and save their city centers?

According to the Association of Dutch Municipalities (Dutch: Vereniging van Nederlandse Gemeenten), municipalities have different instruments they can use to tackle vacancy (VNG, 2011). In the short term, municipalities can negotiate with the building-owners and interested parties. They may have interesting ideas on how to cope with the vacancy of buildings, like blurring: combining retail with nonretail. One example of blurring is KEK Coffee & Crafts Delft (see pp. 13-14). Municipalities can adopt a facilitating role in such cases to overcome the vacancy problem.

In the long-term, municipalities can use the land-use plan to implement changes (VNG, 2011). The land use-plan can be made more flexible, allowing a bigger variety of functions for a building or area. By doing so, it becomes easier to respond to changing market demands, which will lead to less vacancy. A flexible land-use plan also offers space for new initiatives and incentives. Furthermore, municipalities have to truly dive into the vacancy problem of their city, analyze it and come up with a municipal vision on how to cope with the vacancy. In such visions, municipalities can incorporate their strategies, the different steps that are to be taken and set goals that are to be achieved in the (near) future.

An example of a municipality that has made such a municipal vision is the municipality of Nijmegen. In their

vision, it is described how the municipality sees vacancy as an opportunity and how they have noticed that the focus in their inner city center is changing to functions other than retail: the change from ‘place to buy’ to ‘place to meet’ (municipality of Nijmegen, 2015). Some of the actions the municipality is going to take are: changing the functions of buildings in the periphery of the inner city center, appointing areas of concern that have priority, merging different real estate properties and provide maximum cooperation to new, innovative concepts.

So in conclusion, even though vacancy can threat the livability of inner city centers, municipalities can turn the tide and start seeing vacancy as an opportunity instead of a problem!

“In the municipal vision of Nijmegen, it is described how the municipality sees vacancy as an opportunity and how they have noticed that the focus in their inner city center is changing to functions other than retail: the change from ‘place to buy’ to ‘place to meet’.”

References Municipality of Nijmegen. (2015). Binnenstad van de toekomst, Visie op transformative en aanpak leegstand.

VNG, (2011). Leegstand te lijf. Handvatten voor langetermijnstrategie.

Retrieved from https://vng.nl/files/vng/publicaties/2012/ leegstandtelijf.pdf, retrieved on May 8th, 2016.

Joan Ruiz Pion Joan is a student and started the master track Management in the Built Environment in Februari 2015. He is also an active member of the BOSS Magazine Committee.

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CBRE Global Investor’s perspective on the Dutch retail investment market Marije Braam-Mesken Only 3 months ago, newspapers were dominated by headlines such as Department store group V&D declared bankrupt, 10.000 jobs at risk, Dutch footwear group Macintosh Retail Group declared bankrupt and Retail vacancy expected to further increase. Critics gladly used this opportunity to announce the downfall of the Dutch retail market and argued the worst is yet to come. But is the situation really that bad? Is the Dutch retail market really in such a bad shape?

Over 2015 the Dutch economy grew by 1.9%, well above the growth level of other Eurozone countries like Germany, Belgium and France. Growth was largely driven by exports and corporate investments and to a lesser extent by private consumption. Economic growth is expected to strengthen throughout 2016 by 2.0% compared to an Eurozone average of 1.5% per annum (2016-2019). The effects of the European Central Bank quantitative easing programme and the associated weakness of the euro should support economic growth although risks on the downside persist with the concern of the economic slowdown in China and the refugee crisis causing disunity in the European Union.

the improved consumer sentiment. Low inflation coupled with healthy job creation is contributing to growing real household incomes. Confidence in the housing market has been steadily rising, helped by low debt servicing costs due to the ECB’s ultra-loose monetary policy. Overall this has led to increased consumer spending and retail sales improvements in most sectors.

“The impact of improved economic conditions on Dutch retail sales has been encouraging so far. Consumer confidence increased end of 2015 to the highest level in 8 years. A number of factors have contributed to the improved consumer sentiment (...), which have led to increased consumer spending and retail sales improvements in most sectors.”

Rebound in consumer spending The impact of improved economic conditions on Dutch retail sales has been encouraging so far. Consumer confidence increased at the end of 2015 to the highest level in 8 years. A number of factors have contributed to Marije Braam-Mesken Marije is head of EMEA Retail for the EMEA Strategy & Research team of CBRE Global Investors.

She is responsible for coordinating panEuropean retail research.

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Despite the uplift in retail spending a number of key Dutch retailers recently filed for bankruptcy. The timing seems a bit odd now that consumers start spending again.

However, due to the persisting economic downturn, retailers lost their cash reserves and with most of them operating in the mid-market segment they could no longer invest in a distinctive proposition. While leaving empty spaces in many of the key Dutch retail locations this created opportunities for expanding retailers like Primark and Decathlon and new international retailers such as Snipes, TK Maxx and Vapiano. All this will lead to a polarization of the Dutch retail market with the current retailers actively focusing on good quality locations.

Retail investment volumes by buyer types (source: RCA)

Netherlands

Investment appetite to remain strong throughout 2016 In 2015, total investment volumes reached the highest levels since 2007, driven by the economic recovery and the low interest rate environment. In the beginning of the crisis, retail was considered a safe haven, but risks associated with the Dutch retail market, such as the oversupply situation and the impact of e-commerce, have made investors more cautious. However, in

Europe

the latest quarters, investment activity is picking up following the improved economic outlook and the attractive pricing of the Dutch market compared to other European retail markets, where pricing increased already significantly in recent years. Given the renewed interest in the Dutch retail market, the total retail investment volume reached a record high of 2.8 EUR billion in 2015 (1.5 EUR billion in 2014).

â&#x20AC;&#x153;In the latest quarters, investment activity is picking up following the improved economic outlook and the attractive pricing of the Dutch market compared to other European retail markets, where pricing increased already significantly in recent years. Given the renewed interest in the Dutch retail market, the total retail investment volume reached a record high of 2.8 EUR billion in 2015.â&#x20AC;?

A considerable part of retail transactions appeared in portfolio form, sold by both private and institutional investors. Although the asset quality highly varied, a relatively large portion of these portfolios consisted of relatively small high street retail units, supermarkets and small shopping centres. The timing of large portfolio transactions is not a coincidence. If market June 2016

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liquidity increases, sellers use this opportunity to execute their divestment strategies. According to CBRE retail assets of lot sizes up to 40 million were frequently acquired by domestic family offices and private equity funds. Institutional investors and REITs focused more on acquiring prime high street assets.

The share of cross border investors remains persistent in the investment market, with a notable new inflow of capital coming from Asia. European foreign investors were also very active with German investors being traditionally most dominant. Cross-border activity reached in total 75% in 2015 according to RCA. Looking at the first months of this year it is expected to remain high in 2016, as most of the large transactions in the first two months of 2016 were driven by foreign investors. On the short term investors are likely to remain relatively risk averse towards secondary retail assets, given the recent polarization in the market.

Markets opens up for more credit supply The availability of debt generally follows the investment cycle. In the current market environment credit for Dutch prime retail products is widely available.

Competition among lenders is increasing and there is a wide variety of lenders active. Key lenders are international and domestic banks, Pfandbrief banks and insurance companies. As competition between banks increases LTVâ&#x20AC;&#x2122;s will rise further. However, the difference in lending terms between the prime and secondary assets is expected to remain substantial.

The big news this month was that the European Central bank cut its policy interest rates, increased its Quantitative Easing programme and started buying corporate bonds.

For European real estate the main take away is that interest rates are likely to remain incredibly low until 2021. Now that the ECB is buying corporate bond yields this should also mitigate any possible contagion and widening of corporate spreads emanating from the USA.

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The Dutch retail market is showing increasingly healthy occupier trends and remains very attractive to both domestic and foreign investors. From an investment perspective prime product remains scarce and prime yields are likely to stay under downward pressure. As a result investors are moving up their risk curve and trade volumes in the secondary segment of the market are forecasted to increase, though slowly. The turmoil in retail land from an occupancy point of view will likely lead to further sales due to repositioning of portfolios and will attract new overseas retail investors looking to take advantage of the investment activity and the opportunities available.

So even though the headlines might signal differently, the Dutch retail market (with some exceptions) is actually in a good shape. Retailers still consider the Dutch consumer as an important target market.

The economy is gradually growing and consumers are more confident and start spending again.

CBRE Global Investors Dutch Retail Fund portfolio strategy is to anticipate on recent developments in the retail market - like the rise of online sales and the current polarization. The investment focus is on sustainable highquality Dutch retail assets, well balanced over preferred retail types and with a clear focus on the best assets and locations within these retail types. In the strategy a split can be made between fun shopping, run shopping

and destination shopping.

The focus for funshopping (non-daily retail) is on large cities with a young and growing population.

The convenience centres (run shopping) need a dominant position within their catchment.

The Fund portfolio focuses on the large scale specialty centres, which can be categorised as destination shopping. When looking at potential new acquisitions, strict conditions apply with respect to demographic outlook, parking, accessibility, retail supply, anchor tenants and dominance within its catchment area.

“Even though the headlines might signal differently, the Dutch retail market is actually in a good shape.

Retailers still consider the Dutch consumer as an important target market. The economy is gradually growing and consumers are more confident and start spending again.”

ivbnA5liggend2016_Opmaak 1 01-02-16 10:29 Pagina 1

• Altera Vastgoed • Amvest • APG Asset Management • a.s.r. vastgoed vermogensbeheer • AXA Real Estate Investment Managers • Blue Sky Group • Bouwfonds Investment Management • Bouwinvest REIM • CBRE Global Investors (NL) • Dela Vastgoed • Delta Lloyd Vastgoed • FGH Bank • Klépierre • MN • NEWOMIJ • NSI • NS Stations • PGGM • Q-Park • Redevco Nederland • Schiphol Real Estate • SPF Beheer • Stienstra Beleggingen • Syntrus Achmea Real Estate & Finance • Timeos • Unibail - Rodamco • Valad • Vesteda • Wereldhave • Wonam

De Vereniging van Institutionele Beleggers in Vastgoed, Nederland (IVBN) behartigt de gezamenlijke belangen van grote pensioenfondsen, verzekeringsmaatschappijen, vermogensbeheerders en (al dan niet beursgenoteerde) vastgoedfondsen. Per 1 januari 2016 telt IVBN 30 leden. Gezamenlijk vertegenwoordigen de leden ruim 50 miljard euro aan Nederlands onroerend goed en nog eens circa 50 miljard euro in het buitenland.

De bij IVBN aangesloten organisaties beleggen - zowel direct als indirect - voornamelijk in woningen, kantoren en winkelcentra/ winkels. Voor meer informatie inzake de verschillende thema’s en publicaties, zie de website.

De IVBN Scriptieprijs Deze jaarlijkse stimuleringsprijs is door IVBN in het leven geroepen in het kader van de verdere professionalisering van de vastgoedbeleggingssector. De prijs wordt uitgereikt aan de als beste beoordeelde afstudeerscriptie.

De winnaar ontvangt een geldbedrag, evenals de betrokken opleiding.

Meer informatie IVBN Scriptieprijs op www.ivbn.nl.

‘Huize Middenburg’ Westeinde 28 Postbus 620 2270 AP Voorburg

Tel. 070 - 300 03 71 Fax 070 - 369 43 79 info@ivbn.nl www.ivbn.nl

SCRIPTIEPRIJS

2016 31 June 2016

Aerial view of MegaMall CentrO in Oberhausen, Germany

MegaMall downsized

Arno Ruigrok, Multi Corporation

It has been a few years since the idea of a MegaMall was last discussed in the Netherlands. Given the current state of the retail market, it is hardly the obvious time to revisit the subject. But despite this, the MegaMall concept remains fascinating and is likely to re-emerge at some point in the future. So, it is worth taking another close look at this theme: what is a MegaMall? What does it do? Why does it have to make an appearance in the Netherlands? What advantages does it offer and what impact will it have?

Grand in stature and in its impact A MegaMall is essentially a massive retail centre that serves an equally massive market. Everything is supersized: the overall surface, the number of stores, the accompanying catering and hospitality, the additional leisure, the parking, connecting buses or trams and the number of visitors, not to mention the financial interests involved. All of this means that a MegaMall is a destination in itself: a commercial system that operates completely independently. In this view, it is obvious that the bar must be set particularly high in terms of two specific factors that have a major impact: the spatial and the economic factors.

When it comes to space, a MegaMall demands a huge 32

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surface area. The effect is even more extensive than it initially seems, because of the traffic and the space taken up by infrastructure, which covers an even wider area. As an independent, self-operating system, the MegaMall generally has little or no relation with its surroundings, often taking on the characteristics of a UFO: an independent destination in a built-up environment surrounded by infrastructure and parking.

In economic terms, the MegaMall is superimposed onto the retail landscape. Its need for sales is significant and these have to come from somewhere: people will not spend more but what they do spend will be

spread across the market area in a different way. The larger this area is, the smaller the impact on each existing retail location; but the most significant effect inevitably occurs in the immediate environment.

“A MegaMall is essentially a massive retail centre that serves an equally massive market.

Everything is super-sized: the overall surface, the number of stores, the accompanying catering and hospitality, the additional leisure, the parking, connecting buses or trams and the number of visitors, not to mention the financial interests involved.”

These two key impacts clearly illustrate the tensions involved. The MegaMall is more than just an addon ‘thing’, a place where people can enjoy themselves and where jobs are created.

It is something that can have a deep impact. The negative effects are at their greatest in the immediate environment, which goes some way to explaining the heated debate this phenomenon provokes and the commotion involved in its planning and decision-making.

Intricate networked system prevents the emergence of a MegaMall The reason why no MegaMall has yet taken root in the Netherlands can largely be explained by its potentially negative impact. But it is also related to the planning doctrine that formed the basis for how retail was structured in the Netherlands in the second half of the 20th century.

The period between 1950 and 1980 has seen a huge urban expansion, accompanied by careful planning of amenities, including retail. This led to the emergence of an intricate, networked system of retail sites. This was based on the notion that various amenities (including retail) must be available within a certain distance of every home. As a result of this, a well-organised, hierarchical system of retail sites emerged. This ranges from local precincts and district shopping centres to town and city centres of varying size. Only at a later stage were retail sites also planned for functional reasons. Retail parks then began to emerge, along with factory outlet centres.

As a result, the Netherlands not only has a lot of retail stores, but also has a carefully-structured system of retail sites. With this in place, there is less need for a MegaMall. At the same time, competition presented by the existing system is so intense that creating a major mall is far from easy. Equally, the current

system and its underlying principles continue to enjoy widespread support, which means that any plan that competes with it can count on fierce opposition.

Protecting important retail sites Any new, competitive retail plan is always highly critically by both businesses and of retail property. This area of planning is which fierce political and legal battles are

viewed owners one in fought.

The retail market in the Netherlands always has been heavily regulated. The development of new locations and the expansion of existing ones need to be backed up by strong economic arguments. Especially now, as vacancy levels increase, particularly high demands are set when it comes to justifying the need for new plans and the benefits they offer. The aim here is to protect the most valuable elements of our retail structure. These are related to the ability to do day-to-day shopping close to home (social aspects) and the role played by retail in the operation and conservation of city centres (cultural aspects). In practice, however, most objections tend to be based on economic considerations: the threat of competition for existing retailers and retail property.

Arno Ruigrok Multi is a leading owner, manager and developer of high quality shopping centers in Europe and Turkey. As the associate director, Arno is active in research, concepts, strategy and marketing.

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Approximately ten years ago, several initiatives for MegaMalls emerged in the Netherlands. The most obvious of these were plans in Geldermalsen (Deil junction) and in the north of Tilburg. Both were initiated by developers, but both were backed by a local municipality eager to see the plan succeed for reasons of status, land policy or other economic motives. In both cases, the opposition came primarily from municipalities/shopping centres within a radius of approx. 30 km, which were expected to be the worst affected. In both cases, and especially in Tilburg, many of the arguments put forward in favour of the MegaMall were questionable in nature. Studies were accompanied by quality-based annotations that obviously reflected the interests of the commissioning party. Many of these studies were clearly based on foregone conclusions.

“Scale is what really matters when it comes to a MegaMall. This is why it is actually unrealistic in the Netherlands to cast our eyes blindly at examples abroad, where the size of the market, the structure of the offering and planning traditions all differ from ours and are often more conducive to a MegaMall.”

A major project requires a major market Research and practical experience of similar concepts elsewhere in Europe show that MegaMalls call for a particular market context and minimum market size.

A MegaMall is only economically sustainable in a very large market. This is why they are to be found only in the largest European cities: of the size that would dwarf any city in the Netherlands. In terms of market size, this would mean a densely-populated primary market area of at least 500,000 inhabitants, in which the relevant mall dominates the market. In addition to this, a secondary market area of at least another million, but ideally two million inhabitants, with very good transport connections to the location. Apply that to Geldermalsen or Tilburg and the lack of potential in terms of the market is obvious!

Significant impact that is often denied The impact can be significant, which is why any choice needs to be based on realistic evidence rather than a denial of that evidence inspired by opportunism. The impact is greater if the market is too limited, if existing retail locations are already facing problems and if there is inequality in terms of nature of the site and its accessibility.

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In a context in which there is an imbalance, or if a MegaMall gains its position by means of fierce competition, forcing out its opponents, it raises justifiable concerns. CentrO in Germany’s Oberhausen is a perfect example of this.

After this was built, a German journalist produced a highly factual account of how CentrO was forced through, based on economic interests and political opportunism. In the process, the pro-camp used inaccurate arguments and categorically denied clear signs of potentially negative effects. The opportunity to breathe new life into an abandoned steel factory site and push Oberhausen’s economic future won the day. The intended aim became something sacred and all sense of reality vanished.

The result is a ruined city centre for Oberhausen, with a few convenience stores making up the only retail left and shocking levels of vacancy. Other public amenities have even begun to withdraw. City centres in the region (Essen, Bottrop) have also suffered badly.

So, what about ...

When we think about MegaMalls, we always envisage examples in other countries: independent, stand-alone shopping centres operating as a single cohesive whole with little or no relationship with their urban surroundings So how to think about Rotterdam–Alexandrium and Rijswijk–In de Boogaard: both (admittedly only partly) systematically-realised retail areas covering more than 100,000 m2. Rotterdam–Zuidplein and Amsterdam– Boven ’t IJ are clearly both cohesive systems that operate with a high level of autonomy. Although Stadshart Amstelveen may have been realised in stages, it now constitutes a systematically-developed

combination of size and variety with which nothing can compare. Leidschenhage is heading in the same direction. In view of these examples, it is possible to argue that the Netherlands is already quite familiar with the MegaMall, but one that has been downsized and transformed to fit our specific urban culture with its finely-meshed intricacy, local relationships, etc.

It is all about scale: could the south of Amsterdam be an option?

Scale is what really matters when it comes to a MegaMall.

This is why it is actually unrealistic in the Netherlands to cast our eyes blindly at examples abroad, where the size of the market, the structure of the offering and planning traditions all differ from ours and are often more conducive to a MegaMall. In the list of major European cities, Amsterdam is ranked only 22nd. We may look to Londonâ&#x20AC;&#x2122;s Westfield in admiration, but that city is

more than ten times the size of Amsterdam, has a large group of super-rich inhabitants and has a reputation as a shopping magnet for visitors from across the world. Amsterdamâ&#x20AC;&#x2122;s retail image pales in comparison.

And yet: the northern edge of the Randstad conurbation, the southern edge of the Amsterdam Metropolitan Area, the Schiphol corridor: this would be the most suitable place if ever a MegaMall is to be created in the Netherlands. It would first need some calm in the current retail market dynamic and a new and firm foundation for physical retail. Amsterdam needs to develop further as a high-quality city in which to live and work and Schiphol needs to become a powerful hub, with new functions and new destinations clustered around it, aimed at both a Dutch and an international public. Perhaps then retail, a MegaMall, could also find a home there.

Rottedam-Alexandrium, a MegaMall? (source: ANP)

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Retail Bankruptcy Transformation Vacancy Consumers Online shopping City centre Marketing Big data Customer behaviour Supply chain Mobile payments Horeca Sales Facilities Services Business plan Branche Capital Experience

Retail REAL ESTATE PEOPLE Bankruptcy ...Lost architect...

Transformation Dude, thatâ&#x20AC;&#x203A;s our printer...

Vacancy Consumers Online shopping City centre Marketing Big data Customer behaviour

Supply chain Youpayments real estate people really think Mobile youâ&#x20AC;&#x203A;re better than the rest...

Horeca Sales Facilities Services Business plan Branche Capital Experience

I beg to differ!

By Joan Ruiz Pion 36

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Solutions can be found at bosstudelft.nl

1. System whereby customers select goods for themselves and pay at checkout 2. Large shop stocking many varieties of goods in different departments 3. The largest store in a shopping mall 4. Short term shop that comes and goes at a certain time 5. Large building with a lot of stores in it 6. Someone who sells only a specific market segment 7. Have to be paid when ordering something online 8. Company selling the largest quantity of a particular product 9. The shopping day after Thanksgiving in the US when retail stores generate their highest sales 10. The activity of promoting the sale of goods 11. The sale of goods online 12. Deduction from the original costs 13. The manufacture of goods in large quantities by machinery 14. Identifying mark for a sellerâ&#x20AC;&#x2122;s goods or services 15. Modifying according to personal preferences June 2016

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Young professional Dirk van Duijn ‘Real estate development with courage and love’, that’s what Synchroon stands for. Synchroon is part of TBI Holdings, which is a group of enterprises who renew, arrange and maintain the living environment in a sustainable way. My name is Dirk van Duijn, I’m 25 years old and I’ve been working as a project developer at Synchroon for over a year now.

I graduated with a master in Real Estate & Housing in January 2015. My Master thesis was the blend of two of my passions: real estate and football. I researched the social and economic impact of a football stadium on the urban environment. I have always been interested in the impact of catalyst projects on their surroundings. Not only in a financial way, but especially socially. The main research question of my thesis was whether catalysts such as football stadiums have public values for the city and if public investments can help those stadiums to be of added value. I developed an assessment framework which now is used by the municipality of Breda to help them assess their (financial) support to NAC Breda.

The Master of RE&H provided a really good basis for my career. As a former Bouwko, I obtained conceptual and technical knowledge of designing, as well as management and process knowledge. Those are very important for my job as a project developer. One day you have a meeting with a municipality that you want to convince of your idea and concept, the next day you have a construction team meeting with a contractor on how you can create the best solution for a technical problem. Another skill that you acquire at the Master course and Architecture as a whole, is cooperating in teams. This is something I have to do every day when I am coordinating and managing processes. People management, honesty and business sense are key skills.

During my time at Real Estate & Housing, I have been part of the BOSS Magazine committee and I was a BOSS board member of Education. In those positions, I gained a lot of experience with a variety of companies in the real estate

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world, but also in developing and helping the education at RE&H getting better. BOSS organizes events such as the Real Estate Career Day, in-house days at companies and guest lectures. Because of these events, students are offered the opportunity to get to know all different kinds of companies which are involved in real estate. You get to know these companies on different levels and are able to ask anything you want. Because of these events you can develop, as I found out, a very important skill: networking. No matter how many different companies are involved in real estate, you always know someone who works there. And that may come in very handy.

I came across a job vacancy of Synchroon on Facebook in November 2014. I just handed in my P4 report and was looking for a job. I applied at some other vacancies as well, but Synchroon really stood out of the rest. It’s a company which has a lot of innovative concepts and ideas and it wants to bring those concepts to the market, and does so. Synchroon projects are characterized by good, solid concepts which embed the building or buildings in its environment in an urban, architectural and social way.

Real estate companies had to change their ways of working because of the economic crisis. I believe Synchroon really is a precursor in the new ways of working and developing, because of our innovative and sustainable concepts. We are named as one of the best developers in Corporate Social Responsibility. This makes me very proud, since it is my ambition to develop socially and energetic sustainable projects and urban developments.

At this time I have seven projects in my portfolio, all in different stages of the development process. Those projects are situated at different locations, from Amsterdam to Tilburg. Not a single day is the same. I have to travel a lot for meetings and appointments.

Therefore, it is important to properly schedule my work. The market is recovering and Synchroon is doing well, so there is a lot of work to be done. A perfect time for me, and you as future graduates, to start a career!

Photographed by I. Pouw, 2016

>>

â&#x20AC;&#x153;I believe Synchroon really is a precursor in the new ways of working and developing, because of our innovative and sustainable concepts. We are also named as one of the best developers in Corporate Social Responsibility. This makes me very proud, since it is my ambition to develop socially and energetic sustainable projects.â&#x20AC;?

June 2016

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Student or young professional?

Luuk Gremmen in an interview with Sander Verseput Sander Verseput does not only study Management in the Built Environment (MBE) at the TU Delft, but he is also one of the three co-founders of Chainels.

His office is located in the Handelsgebouw next to Rotterdam Central station. The building houses a collection of interesting start-ups. Most of them are run by young professionals and provide an inspiring environment to work in.

Chainels is a business to business communication platform for shopping streets and malls. Starting this year, they will also add business parks to their clientele. You can see Chainels as an intranet, with a private Twitter built in, for the business owners in the shopping street. It can replace everything from excel lists to old fashioned newsletters.

They advertise it as: â&#x20AC;&#x153;Chique and user friendlyâ&#x20AC;?.

Chainels was originally conceived as the graduation project of Erwin Buckers, at the time a student of computer science at the TU Delft. Afterwards, Erwin and

Sander enrolled for YES! Delft, to follow classes helping them to start their own business. Initially they started working on a different idea, making LED-lights that could be controlled with an app. The communication network for local businesses that Erwin started working on for his graduation project proved more successful, and as soon as the first two customers were attracted, the ball started rolling. In 2012 Erwin and Sander were joined by Willem Buijs, an Industrial Design graduate, and the three of them founded Chainels.

In 2014 the first two customers of the start-up were De 9 Straatjes in Amsterdam and downtown Delft.

Having secured two customers, Chainels attracted a small investment and in two years time the young professionals managed to expand their customer base to 35 shopping areas. The platform was still in its early stages in that time and this caused the system to be shaped by requests from the clients. This philosophy is

Chainels, the business to business communication platform for shopping streets and malls.

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Data center DATA IN

0 7 2 5

Over

FOOT FALL

DIGITAL DIGITAL SCREEN SCREEN

Bedrijfsnaam* Bedrijfsnaam Kies je catagorie Sector Over

GLA (m²)

Een omschrijving van je onderneming

10m²

Opslaan

Annuleren

SHOPPING SHOPPING APP APP

C 10 . 25

WEBSITE WEBSITE

REVENUE

DATA OUT

Data center: The Chainels API makes it possible to synchronize up-to-date store information between the Chainels database and The Chainels API makes it possible to synchronize up-to-date store information between the any type of consumer product. Data with relevance for internal purposes can be collected from other sources.

Chainels database and any type of consumer product. Data with relevance for internal purposes can be collected from other sources.

still at the core of Chainels now that their customer base has grown to include the Kalverstraat, PC Hooftstraat in Amsterdam and the Koopgoot in Rotterdam.

CORPORATE PRESENTATION

graduation over a longer time period, giving both his study and the company the time they deserve.

2016

The intersection between Chainels and the Management in the Built Environment mastertrack might not be immediately obvious. When asked what his background in MBE brings to the start-up, Sander replies with one clarifying answer: the jargon. Chainels is sold directly to the real estate owners and managers of shopping streets and malls, and thanks to his education Sander is able to talk in their language and understand their point of view. This has lead Chainels’ marketing as well: prices are given in yearly costs per square meter as you would expect in real estate, but this is rare to see in the software development market. Even though being able to communicate with owners and managers is directly related to MBE, Sander is using other skills from his master on a day to day basis. He is responsible for the finance of the company, which illustrates how diverse a career started with MBE can turn out to be.

About the fact that Sander is combining working at his own company with studying, he says that the biggest challenge is the planning. He started working more with his own deadlines and has spread his

“Chainels is sold directly to the real estate owners and managers of shopping streets and malls, and thanks to his education Sander is able to talk in their language and understand their point of view.”

Sander Verseput Sander started the master track Management in the Built Environment in September 2013 and cofounded Chainels in 2014.

He is now graduating on the topic of retail.

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Impressions of the Real Estate Career Day 2016 The colours of the Real Estate Career Day corresponded with the location for the kick-off of the event. In the orange hall of the TU Delftâ&#x20AC;&#x2122;s Faculty of Architecture, several leading real estate figures discussed current changes and innovations in the work field. With the different backgrounds of the participants in the audience, the kick-off evolved in a dynamic and informative discussion. As a good warm-up for the first business case, the visitors dispersed over the building.

The companies had the possibility to present themselves and the participants got the opportunity to take a closer look at the companies they were selected for. After the introduction, small groups worked on the given case. Each group gave a short presentation about their findings and solutions and the company chose a winner.

After the first business case, lunch was served in the orange hall. This was the time to relax and exchange impressions of the day so far. After the lunch, the program continued with a second business case and workshops.

In the afternoon, the information market with more than 25 companies offered the possibility to ask questions Esther Brejaart Esther is a student and started the master track Management in the Built Environment in September 2015.

and to get to know each other better. Also, a selection of students got the opportunity to engage in a more personal conversation with a company who selected them, based on their CV and motivational letter. The Real Estate Career Day ended with an informal drink and dinner to expand networks and exchange the impressions of the day.

For me, this event was a good addition to my search for a graduation internship. I attended the business cases of AT Osborne and Deloitte, which gave me a look behind the scenes about the work they do. It was nice to work on a case with participants of different backgrounds. We won the first case of AT Osborne and as a prize, we were invited to visit one of their projects.

In the afternoon, I had a speed-date with dvpc and with AT Osborne. The information market consisted of a variety of real estate developers, consultants, contractors and start-ups. Because of this diverse selection, I got a good overview of the possibilities the real estate sector could offer me.

The organisation committee of this day provided a diverse program with a lot of opportunities to explore the world of real estate. I am impressed by the professional organisation and the facilities of the event. The overall ambiance was a nice balance of formality and informality. Also amongst the visitors, there was a lot of interaction and exchange of network.

Altogether, the RECD was a motley collection of people and companies with one constant factor: a passion for real estate and development.

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