MAPIC 2019 PREVIEW

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PREVIEW October 2019 www.mapic.com

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43 RETAIL REMIXED LIFESTYLE DESTINATIONS Experience, engage, educate, entertain

LEISURE TAKES CENTRESTAGE GETTING SERIOUS ABOUT FUN New formats and innovations

SHOPPING THE WORLD RETAIL BREAKING THE MOULD Physical in the digital age

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EDITORIAL

Nathalie Depetro, MAPIC shows director (left); Francesco Pupillo, MAPIC deputy director; and Filippo Rean, director of the real estate division

WELCOME to the MAPIC 2019 Preview, which represents a milestone not just because it showcases the 25th edition of our international retail property market, but also because we have made some exciting changes and additions to this year’s event.

With so many challenges and opportunities facing the industry, MAPIC has already evolved to embrace the emergence of lifestyle destinations and last year we put these themes at the heart of the conversation, including food and beverage, edutainment, leisure, live entertainment, customer services, digital innovation, spas, fitness centres and medical centres.

This year we have taken this even further, with our special focus dedicated to: Retail Remixed: Rethinking Spaces And Places. Over 8,500 attendees are expected, from 80 countries and including more than 2,000 retailers, to learn about the new generation of mixed-use projects bringing leisure, F&B, wellbeing, residential and office space to their lifestyle destinations.

We are also delighted to say that last year’s debut Leisure Day has been expanded and will now form a full-day event in Cannes on the day before MAPIC opens. This international gathering will bring together leisure operators and specialists to discuss the key themes of the day, providing unprecedented insight into this rapidly expanding area. And there will be some exciting news about this event to reveal in Cannes.

These additional and growing events in Cannes reflect the increasing breadth of MAPIC and our team has been busier than ever throughout this year. In April, MAPIC Russia took up its new home at Crocus Expo in Moscow; in May, we returned to Milan for MAPIC Italy and MAPIC FOOD; and in September we organised MAPIC India.

This year MAPIC will be even more focused on retailers by offering retail visitors exclusive facilities and high visibility, including a Lounge where retailers will be able to bring their guests, meet peers, showcase opportunities and pitch their concepts.

And with franchise partners increasingly key, this year we have launched a Multi-Unit Franchise Summit dedicated to franchise partners and focusing on international expansion and identifying vibrant concepts.

Of course, MAPIC 2019 will continue to include everything that has made it a must-attend event. In between discovering new companies and contacts, delegates will be able to attend another world-class programme of free conferences, try their hand at speed dating, and take part in innovation forums, workshops, lunches and evening events, as we continue to bring all the players together to help shape the best places to live, play and shop.

MAPIC PREVIEW • 3

• October 2019

S T E E R I N G 20 COMMITTEE 19

THANK YOU for your loyal support

Mr. Alain Boutigny

Mrs. Laurence Karsenti

SITES COMMERCIAUX

THOR EQUITIES

CEO & Founder

Mr. Luca Cappuccitti THE CIRCOLO Founder & CEO

Leasing Director Europe

Mr. Henrie W. Koetter

CAMAIEU Head of property

Mr. Jean-Paul Freret Associés en Finance Senior Advisor

Mr. Klaus Striebich CEO

RESOLUTION PROPERTY Senior Asset Manager Europe

Mr. Tom Meager PRIMARK Group Property Director

Mr. Laurent Plantier

IKEA CENTRES

FRENCH FOOD CAPITAL

Mr. Damian Hopkins MATALAN International Director

Mr. Chris Igwe CHRIS IGWE INTERNATIONAL Founder & CEO

Mrs. Charlotte Journo Baur WISHIBAM CEO

CEO

ECE

Mr. Carsten Heidtmann Global Leasing Director

INTU Group

Chief Investment Officer/Managing Director

Mrs. Mayte Legeay Mr. Pierre Combet

Mr John Strachan

Founder & Partner

Mr. Christian Recalcati LARRY SMITH Managing Director

Mr. John Scott

RaRE-Advise

Mr. Fabien Stutz NIKE EMEA Senior Director Real Estate & Store Construction

Mr. Brian Tucker GEWERBE IMMOBILIEN / LIVEFRESH Partner & CEO

Mr. Franck Vershelle ADVANTAIL CEO

Mr. Reinhart Viane KCC Business Development Director

TM LEWIN

Mr. Peter Wilhelm

Director of International Business Development

CEO

Mrs. Valerie Stern FAST RETAILING GROUP Head of Global Strategic Alliance

WILHELM & CO

Mrs. Pamela Wolf SALESFORCE Director Customer Innovation

CONTENTS

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THE RETAIL MIX

MAPIC AROUND THE WORLD

As mixed uses and new tenant combinations continue to reshape the retail environment, we look at how a changing landscape is to be reflected at MAPIC 2019.

MAPIC has already held events and networking evenings in London, Milan, Moscow, Mumbai, Seoul and Shanghai this year.

43

REGIONS

Detailed analysis of some of the latest developments, investments and retail and leisure initiatives across the world’s major consumer markets.

FRANCE, UK, GERMANY THE NETHERLANDS ITALY SPAIN AND PORTUGAL THE NORDICS

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43 53 57 61 65

RUSSIA AND CEE TURKEY AND MENA NORTH AMERICA ASIA

69 77 81 87

LEISURE

As MAPIC launches its first full Leisure Day, we consider the growing role of leisure within lifestyle destinations and standalone locations, plus the expanding concepts on offer.

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YOUR MAPIC EXPERIENCE

How to get here • Your badge and registration • Must-attend events • Must-visit areas • Meetings and Map

94 AWARDS This year’s MAPIC Awards have been broadened to reflect the growing diversity of retail real estate and the new players influencing the future of the sector.

95 CONFERENCES & EVENTS

PROGRAMME

MAPIC PREVIEW • 5

• October 2019

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9.091 KM

That’s the exact distance from California’s Venice Beach to KINNELOA restaurant at Hamburg’s Europa Passage. We travel the world to bring back the best food to our customers. www.ece.com/welovefood

Visit us at MAPIC

R7.G14

RETAIL MIX: MAPIC 2019

Retail Remixed: Rethinking spaces and places The rulebook on what makes a great destination has been rewritten by a digital-age consumer who is as likely to visit a lifestyle destination to eat, watch a movie or visit their co-working space as they are to shop. Mark Faithfull looks at how MAPIC 2019 will reflect these blending uses and and previews the dedicated Leisure Day

T

HE retail and retail real estate industries are evolving rapidly, responding to a dramatic change in the way consumers live, play and shop. Retailers have already acted to embrace the omni-channel revolution, with demand for less physical stores one of the consequences. The reaction from the real estate community has been to begin reimagining their centres, with densification the new

mantra to capture the blending of retail, F&B, leisure, work and co-work, residential and logistics within a single location.

These changes are reflected throughout the pages of MAPIC Preview, as we highlight new projects from around the world which are being created as lifestyle destinations, and by the redevelopment of schemes that are introducing fresh elements to revitalise their centres.

With these changes come new

locations which can revitalise urban centres, bring mixed uses to communities, encourage fresh investments and new business models and help create iconic places and brand experiences, forging new partnerships and adjacencies.

As a result, this year’s MAPIC will focus on three key, inter-related themes: Reloading The Retail Mix; Blending Uses For Lifestyle Destinations and Shopping The World.

850

50%

€621bn

Predicted number of stores to be opened by digital native retailers in next five years

Proportion of European development completions in 2019 accounted for by Turkey, Russia and Poland

JLL Research, US

Cushman & Wakefield

MAPIC PREVIEW • 7

Predicted ecommerce sales in 2019, up 13.6% on 2018 Ecommerce Foundation

• October 2019

The event will examine how this blending of uses will ensure more multi-functional destinations, creating not just more vibrant locations but will also require retailers to question the role of their stores within locations that will evolve and change as they appeal to consumers in different ways.

The retail mix of lifestyle destinations is also likely to look very different from the tenant mix in traditional malls. And with that, new opportunities and challenges will emerge for retailers looking to expand and position their brands.

Over the coming pages we look at how these elements have encouraged an explosion in leisure opportunities and formats and how the retail mix is reforming for a new age.

RETAIL REMIXED

No pain, no gain?

The shopping centre is dead. Long live the shopping centre. The future is about densified retail spaces re-engineered, reimagined and curated for a new generation of consumption, writes Mark Faithfull. And it’s about to get radical

B

ATTERED by apocalyptic predictions of its demise, retail has arguably never faced more challenging times. Legacy names have fallen, consigned to history. More will follow. Online giants Amazon and Alibaba are sweeping away rival retailers and snapping up both physical and virtual competitors. Jobs are automating.

More stores are closing than

opening. Unstable politics is destabilising economies.

It is hardly the backdrop against which you would expect Toys“R”Us to be making its comeback with two new US stores. Or investment giant Elliot to be adding US bookseller Barnes & Noble to its acquisition of UK book-store chain Waterstones, pledging to take on Amazon with James Daunt at the helm. Or for Daiso to be

AliExpress recently opened in Madrid at intu’s Xanadu

taking its Japanese hard-discount format to the US. Or for huge investments to be lined up in re-imagined shopping centres.

On top of that, not only has Microsoft opened its first physical store in Europe (see UK section) but Alibaba has done the same, with AliExpress opening within Madrid shopping centre, intu Xanadu, jointly owned by intu and Nuveen Real Estate.

The store, a collaboration between AliExpress and D.Phone opened in late August, allowing visitors to shop a vast range of technology and electronics products, including small appliances, household items and wearables.

Marta Cladera de Codina, man-

Investment giant Elliot has bought both Waterstones and Barnes & Noble (pictured)

MAPIC PREVIEW • 8

• October 2019

aging director Nuveen Real Estate Iberia, says: “This will see us take another step forward in delivering a comprehensive retail offering, making for an increasingly pleasant shopping experience and visit.”

So what’s going on? Clearly, the volume of physical retail in most markets — certainly the mature ones — is not going to return to previous levels. And much has already been done to introduce other uses to shopping centres and high streets, notably the huge rise in F&B and the current surge in leisure.

The industry has struggled to come up with an all-encapsulating term for this change in destinations, settling for now on ‘placemaking’ and, more recently, ‘lifestyle destinations’.

Put simply, it is unlikely we will see any major development that does not include a range of uses, or a retail redevelopment that does not seek to bring in different classifications.

“At a time when you don’t even need to go shopping anymore, what is the purpose of a store?” asks Delphine Beer-Gabel, founder of Paris-based consultancy The Retailtainment Company.

“Answering that question will lead you to the new art of retail. Physical retail is not dead providing it reinvents itself to

RETAIL REMIXED adapt to the new expectations of consumers, in constant search of fresh, innovative experiences.

“How you achieve that magic is by considering that the store is a media that needs curation and content to attract and engage audiences both physically and socially.”

Beer-Gabel, who is speaking on November 14 during the France Forum at MAPIC, adds: “The brains need to be in the store not at the head offices. Because that’s where the clients are and where they need to be engaged.

You need to feel the beat and amplify it with events, generating content on social media which will eventually generate drive to store. Geolocalised marketing is growing with efficient digital tools, making this discipline more accurate and relevant versus traditional methods.

“Why it matters is because acknowledging this fact has many impacts on how retailers should organise not only their marketing, but also their sales department and their operations as a whole.”

“It’s the first time ever that we have seen all the markets we

OUTLET SUMMIT 2019 MAPIC’s Outlet Summit — back for its third year in 2019 — takes place on the afternoon of Tuesday, November 12 at the Majestic hotel. Under the theme Retail Remixed: Rethinking Spaces And Places, the event’s official partner is Magdus and it is sponsored by Art

cover so aligned, all in the same moment at the same time,” says Paul Souber, Colliers International’s head of retail agency London and co-head of EMEA retail. “Old metrics like turnover only tell part of the story.

Instead, it’s about working out the productivity of a location.

By being able to interpret lots of different data, we can start to look at leases and debate the value of physical stores. In terms of estate management, we are now coming together with landlords and our full teams — from retail to hotels to

Software Group, Fashion House Group, Neinver, Via Jurmala Outlet Village and VIA Outlets.

This year’s Outlet Summit will cover the sector’s key themes, starting with an overview of the current industry and its prospects for the next decade. This will be followed by panel

debt structure — to see what’s possible in terms of reconfiguring existing centres. It genuinely is involving the stakeholders in placemaking. But, of course, you need to understand the finances, because it’s all very well to look at what can be done, but you also have to look at the impact of, say, shutting half the retail for 12 months. It has to be worth it, because it will be a painful journey.”

He adds: “The fundamental changes that are going on are undoubtedly going to cause more pain for retail. But the retail that emerges should be reinvigorated and, if it’s in locations that have adapted and shown flexibility, then it should be able to succeed. Those that are still in the Dark Ages will have to hope for the best.”

Paul Souber, Colliers International: “The

Residential meets retail at Westfield Stratford/Cherry Park West

MAPIC PREVIEW • 9

fundamental changes are undoubtedly going to cause more pain.

But the retail that emerges should be reinvigorated. Those still in the Dark Ages will have to hope for the best” • October 2019

sessions and expert insights into how to transition outlets centres into tourism destinations; managing data to drive performance; rethinking the tenant mix to make outlets more attractive; and the key qualities needed to create a new outlet or mixused redevelopment.

Densify or die

Shopping-centre groups have already coined a term for the strategy: ‘densify’. And opportunities are being aggressively pursued in both the US and Europe. One of the most ambitious examples is from Unibail-Rodamco-Westfield, which has partnered with Canadian Institutions Public Sector Pension Investment Board (PSP Investments) and QuadReal Property Group to develop a €750m private-rented sector (PRS) scheme, located adjacent to Westfield Stratford City in London.

PSP Investments and QuadReal will each take a 37.5% share in Cherry Park Partnership, while Unibail-Rodamco-Westfield will retain a 25% share and act as the development and asset manager for around 1,200 private-rented homes. The scheme broke ground earlier this year, with a phased completion and delivery expected after 2023.

“This new residential quarter in the heart of Stratford City is an example of the group’s strategy to significantly increase the densification of exceptional and highly connected retail destinations by adding offices, residential, hotels and other uses, where relevant,” says Olivier Bossard, Unibail-Rodamco-Westfield’s group chief development officer.

One of the UK’s biggest list-

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RETAIL REMIXED ed property companies is also drawing up plans to build apartments above and around its shopping centres. Landsec, which owns Trinity Leeds and Gunwharf Quays in Portsmouth, is working on a rental-housing strategy to increase income at its 16 shopping centres around the country, with an initial focus on London. The developer hopes to profit from the growing number of people who rent and boost the value of its shops, shopping centres and retail parks. Similarly, intu is to add 1,000 residences to Lakeside in Essex and is looking for similar opportunities at its other centres.

Marc Reijnen, head of asset management, continental Europe, at M&G Real Estate, stresses that some shopping centres and high-street locations continue to perform well.

“If you have the right location, then retail remains a strong asset,” he adds.

For those holding weaker centres, Reijnen says there are a variety of opportunities around community functions such as libraries

and healthcare: “Clearly, those shopping centres struggling in mid-size towns need to change, because the nature of shopping centres is changing. They are retail platforms, from which other developments can happen.”

Jonathan Doughty, ECE:

“You can have all the right ingredients but you can make a really bad meal. So the secret to consistent profitability is a really good recipe” Jonathan Doughty, global head of foodservice, leisure and placemaking at German developer and landlord ECE, also warns against a formulaic approach. ECE recently opened Foodtopia at MyZeil in Frankfurt as part of a more radical placemaking agenda for its assets. Doughty says that the devil is in the detail: “The simple fact is that you can have all the right ingredients but you can make a really bad meal. So the secret to

ECE opened Foodtopia at MyZeil as part of its placemaking agenda

consistent profitability is a really good recipe. We see so many projects, even now, where the F&B is placed at, for example, the base of office buildings — and yet those buildings create a wind tunnel and no-one can sit outside the restaurant. That sort of thing is just no longer good enough. You have got to do the detail.”

This requires a far more joinedup approach from those creating destinations. And patience is also a prerequisite, Doughty adds — “something that is often in short supply”.

Moving with the market

At the heart of many of these changes is mobility, says Christian Dubois, head of retail services, France, for advisor Cushman & Wakefield. He believes that the switch in urban areas from mass transit and cars to bicycles, scooters and walking has led to a requirement for living, working, socialising and retailing to be closer together in what he calls “urban villages”.

The challenge for the industry is to create mixed-use destinations that meet these aspirations, he adds, “because, for an Amazon generation that has been taught to be impatient when things take too long, now the journey time across a city is too much”.

Dubois believes that these villages can also be created outside cities, as out-of-town schemes are converted to include residential and perhaps logistics, medical, leisure and entertainment facilities, as the net need for existing retail space declines.

“To me, the answer is not to freeze the development of new space, because otherwise what you will have is space that is stuck in the past and that will actually lead to more closures,” Dubois says. “Instead, we need new developments

MAPIC PREVIEW • 11 • October 2019

Cushman & Wakefield’s Christian Dubois

to encourage people to shop in physical locations, and we have to transform the existing space.”

As a result of the changes, Colliers’ Souber predicts: “We’ll see new models emerge. The days of long leases are over. So we need to look at the success of the designer-outlet model. Perhaps we’ll see more of a WeWork approach, with space created for tenants fitted out or kept simple, to remove a lot of the upfront capex. But with that will come the ability to share sales data and for landlords to help retailers. And they will also to have the power to terminate the leases of those who are not performing.”

In with outlets

Mayte Legeay, senior asset manager, Europe, for Resolution Property, elaborates on Souber’s point about the designer-outlet model: “Outlets have become a natural part of the omni-channel distribution strategy of retailers. Indeed, in the current disruptive and evolving market, designer-outlet centres is one segment that keeps on performing and presents less risk of possible disruption thanks to its intrinsic specific values. Tourism, leisure, F&B and digital strategies are generally linked to outlet operations.”

RETAIL REMIXED Mayte Legeay, Resolution Property: “In the current

disruptive and evolving market, designeroutlet centres is one segment that keeps on performing”

Resolution Property’s Mayte Legeay

Legeay believes the mature, fullprice retail markets of NorthWest Europe are the most at risk of disruption in the short to medium term, as retailers adapt their distribution networks in order to adopt omni-channel strategies. “The outlet operators had anticipated this evolution and had started to propose innovative experiences to retailers and customers more than 10 years before the classic fullprice retail segment,” she adds.

“Although the outlet sector is less developed in Europe than full-price retail, retailers and landlords continue their international outlet expansion.”

A point in case is a new scheme to the west of Paris. In November 2018, following more than 20 years in planning, designer-outlet specialist McArthurGlen obtained final approval for the first luxury designer outlet

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E U R O PA C I T Y

McArthurGlen’s outlet centre Normandie, in western Paris

— Normandie — in the western area of Paris. Opening in 2021, the €200m designer outlet will cover 20,000 sq m and include 100 stores, a selection of restaurants and cafes, a lux-

ury piazza and 1,200 parking spaces. To complement this, an artisan village will be created to showcase and celebrate art, local craftsmanship and culture.

Developed in partnership with

The ultimate urban getaway leisure • culture • sports • food • shopping

© Bjarke Ingels Group / Europacity

Iconic urban destination of Greater Paris, EuropaCity is a unique entertainment district with the highest ambitions for positive local & global impact

Meet the team at stand R7.K11 www.europacity.com

MAPIC PREVIEW • 12 • October 2019

by

RETAIL REMIXED France’s Chambers of Commerce and Industry (CCI), the Chamber of Crafts and Artisanship of the Eure (CMA) and the French National Institute of Crafts (INMA), the village — called Maison des Metiers d’Art — will include workshops and studios for craftspeople, as well as exhibition and sales space.

“The designer outlet will serve the west Paris population, the local catchment, tourists and international visitors looking for discounted luxury goods,” says Mike Natas, joint managing director of development for McArthurGlen. “But while the centre will be very modern, it will be complemented with what is a first for us — an artisan village.”

According to Natas, Maison des Metiers d’Art will not only promote local goods and services, but it will also encourage repeat visits. Covering an area of 2,000 sq m, or around a third of the

The Scotch Corner Designer Village, due to open in June 2021

central courtyard area, it is directly facing one frontage of Normandie.

“The idea is that this becomes an offer that changes seasonally and

allows people to buy truly original products, so it brings another point of interest,” Natas adds.

“We believe the two offers will complement each other, with the

THE RETAIL MIX: THIS IS US “DISCOUNT and value concepts remain white hot and in expansion mode, while luxury retail also remains in growth mode. Increasingly, we’re seeing luxury concepts look beyond Manhattan for high-street flagships.

This has less to do with the desirability of New York real estate — which still offers the densest foot traffic and some of the highest per-squarefoot sales — and more to do with affordability in other high-street districts.

“Meanwhile, though ground-up development is nearly non-existent, the redevelopment of existing shopping centres — particularly suburban malls — with a focus on densifying projects is

taking off. Increasingly, landlords are replacing vacant large boxes or department stores with medical, office, hospitality and multi-family. While the trend is in its infancy, it will help to reduce retail vacancies, densify centres, boost foot traffic and stabilise mall retail over the next decade.

“While the headlines may appear bleak, we’re seeing an explosion of growth from digital-native retailers going bricks-and-mortar. Additionally, experiential concepts — from innovative retailers and concept stores to ‘eater-tainment’ and elevated F&B chains — are in aggressive growth mode. We’re also seeing continued growth

from wellness and food concepts, though casual dining is contracting and the restaurant closure rate is creeping up in some markets due to over-saturation and the rising cost of labour in a tight job market.”

Garrick Brown, vice-president of retail intelligence, Americas, Cushman & Wakefield

MAPIC PREVIEW • 13 • October 2019

local craft companies helped by the outlet as a driver of traffic.”

Over the channel in the UK, Simon Waterfield, chief executive of Scotch Corner Designer Village, hopes that construction will begin on the 19,000 sq m project in January. The scheme will deliver around 85 stores, including F&B, when it opens at the end of June 2021.

“The aim is to create something that rivals the high-end designer outlets in the UK, bringing international names, local favourites and aspirational brands to this large, strategically located site,” Waterfield says.

Scotch Corner is on the route between Scotland and the north of England. As a result, Waterfield is confident that it will attract a “wealthy local catchment”, plus both domestic and international tourists who travel past the famous junction. “We want this to be a half-day or whole-day destination,” he adds. “We’ll also be announcing a large leisure project and complementary retail scheme to sit adjacent to the designer village, making use of the huge popularity of Yorkshire as a tourist centre.”

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RE:IMAGINING RETAIL HOW RETAIL IS BEING REPOSITIONED AND REPURPOSED FOR THE FUTURE

MAPIC 2019: VISIT US AT STAND P-1.M 2 savills.com/mapic

RETAIL REMIXED Fashion forward

Retailers, meanwhile, are doing their best to respond to their industry’s new paradigm. French ready-to-wear brand Jennyfer has more than 500 stores across 27 countries, consisting of a mix of owned and franchised locations. The past few months have been what the company describes as a “crucial time” in its development, as it looks to build a new business model based on “a good product at a good price, incorporated within a new brand image”.

Jennyfer is practicing an on-demand strategy, offering a larger product range with a shorter lead time to market. It recently opened its first new ‘Ringside’ concept store in Polygone Mall in Montpellier. The new concept is “raw, bold and digital”, with shop windows replaced with vertical screens, additional screens in-store and an automatic click-and-collect service.

Over the next couple of years, Jennyfer aims to reinforce its domestic presence and expand into Belgium and Italy, while focusing on its main international markets in the Middle East and North Africa. The company has recently launched a daring communications campaign called #Don’tCallMeJennyfer, which aims to break down stereotypes by asking people to look beyond misleading appearances and embrace difference.

Other fashion retailers to have opened new stores this year include UK-based Matalan, which has been especially active in the Gulf region. New stores have opened or are due to open before the end of 2019 in Khurais Mall, Al Qasr Mall and Atyaf Mall in Riyadh, Mall Of Muscat in Oman and Sharjah Safeer Mall in the UAE. The company

has also refreshed its 1,400 sq m store at Mirdif City Centre Mall in Dubai and opened a new store in Landmark Group’s Oasis Mall. In Europe, meanwhile, Matalan has plans for a new store in Malta and a Home store in Gibraltar.

“New international stores planned for 2020 include Georgia, Egypt, Morocco, the Balkans and Cyprus,” says Matalan international director Damian Hopkins.

47%

of connected consumers globally who want to “see or try before buying”, the top motivation for shopping in store Source: Euromonitor International

CONFERENCES & EVENTS AT MAPIC

THE NEW MIX IN MODERN DEVELOPMENTS & REGENERATION PROJECTS Thursday, November 14 - 09.00-09.45 Main conference room, Level -1 HOW CO-WORKING, CO-LIVING AND CULTURAL CHANGES REDEFINE RETAIL AS A SERVICE? Wednesday, November 13 - 17.30-18.15 Main conference room, Level -1 OUTLET SUMMIT [By registration only] Tuesday, November 12 - 14.45-18.45 Majestic hotel Cannes

Jennyfer aims to reinforce its domestic presence and expand into Belgium and Italy

MAPIC PREVIEW • 15 • October 2019

040_RM INNOVATION FORUM_PV_PIC

DISCOVER THE INNOVATION HUB GATHERING THE LATEST RETAIL PROPERTY TECHNOLOGIES AND SOLUTIONS! Meet key industry players and find solutions through innovation, collaboration, technology, and the engagement of young leaders.

Join over 40 tech providers, startups, and key innovation players PALAIS -1

INNOVATION TALKS & WORKSHOPS

NETWORKING EVENTS

INNOVATION SHOWCASE

INNOVATION GUIDED TOURS Book your private visit of the MAPIC Innovation Forum and fulfill your business strategy at no additional cost!

Days Wednesday 13 and Thursday 14 November Slots 9.30 - 11.00 / 12.00 - 15.00 / 16.00 - 17.30 Duration 30min (more or less) Price FREE

Contact: charles.debenaze@reedmidem.com

Discover the full Innovation Forum programme on www.mapic.com/discover/innovation Sponsor Innovation Forum:

RETAIL MIX: MAPIC INNOVATION FORUM

Innovation in action

The MAPIC Innovation Forum is back, with showcases, workshops, conferences and networking sessions for real estate players and retailers interested in the opportunities presented by data and digital innovation. Mark Faithfull reports

M

ORE THAN 25 companies are presenting ideas to enable retailers to harness data and turn it into insight at the MAPIC Innovation Forum, which brings together today’s retailers and real estate players with tomorrow’s technologies and solutions.

Take, for example, Lille-based Follow The Market, which helps retailers to measure the real performance of their businesses by enabling them to compare results against those of their competitors.

“We make market data available while guaranteeing the privacy and the security of that data,” says company co-founder Nicolas Blicq. This enables retailers to validate their strategies, calculate the impact and ROI of their local actions and operations, assess their performance on the national market and deploy good practices locally.

Meanwhile, Coniq — one of Europe’s largest loyalty CRM providers for retail — will be presenting its latest research into how loyalty behaviours differ among key demographic groups.

It will also be unveiling the latest features of iQ, its award-winning loyalty CRM platform.

Operating in the same space is Transaction Connect, which provides a marketing solution for spending-based loyalty programmes. The system uses banking technologies to collect and analyse purchasing data. Customers are automatically rewarded when they pay with their usual credit card. Transaction Connect has also launched a new functionality that allows customers to scan receipts of items paid for in cash. At MAPIC, the company will be announcing the launch of the Intelligent Offer Module, powered with machine learning, which automatically defines the best offer for each customer.

MAPIC Innovation Forum sponsor Clear Channel is a leader in digital out-of-home advertising in shopping centres. The company’s screens are designed to improve the ambience and atmosphere of malls, with a strong focus on design and architecture.

While screens are ideal for capturing the purchase decisions made inside a mall — and, as a result, are a powerful tool for influencing shoppers — they can also help retailers to increase footfall. Moreover, full-motion digital screens with touchscreens and mobile connectivity are also opening up new opportunities to leverage social-media content.

Tenant-engagement platform Chainels is exhibiting at the Innovation Forum for the third consecutive time this year. The Rotterdam-based company reports that an increasing number of retail destinations have been choosing its “pocket-sized community tool” to improve com-

MAPIC PREVIEW • 17 • October 2019

munication flow while reducing operational costs.

Company founder Sander Verseput says: “We now deliver innovative solutions to more than 200 communities with over 30,000 tenants in Europe, helping them bridge the gap between occupiers, property management, FM, asset management and other stakeholders. For us, MAPIC is the key yearly event.

CONFERENCES & EVENTS AT MAPIC

DATA: IS IT THE GAME CHANGER? Wednesday, November 13 - 10.00-11.00 Innovation Forum, Level -1 WORKSHOPS BLOCKCHAIN /O2O/ PAYMENT Wednesday Nov 13 - 10.00-11.00 / 14.00-15.00 Thursday, Nov 14 - 14.00-15.00 Innovation Forum, Level -1 INNOVATION FLASH TALKS SESSIONS Wednesday, Nov 13 - 15.00-16.00 Thursday, Nov 14 - 11.00-12.00 / 15.00-16.00

030_RM LEISURE DAY_PV_PIC

LEISURE DAY 12 November 2019 - HĂ´tel Martinez, Cannes, France

The international event accelerating the integration of leisure in lifestyle destinations!

500 Participants

200 Leisure operators & suppliers

1 Keynote

6 Learning sessions

The full-day event will invite leisure operators ranging from e-gaming and theme parks to live music, museums, art galleries, wellness and food, as well as retailers, brand owners, suppliers, urban planners, media, architects and property developers. The participants will gather to co-create new sustainable business models in order to build the lifestyle destinations of tomorrow.

AMONGST CONFIRMED SPEAKERS

Andreas Veilstrup Andersen Executive Vice President TIVOLI GARDENS

Andrew Darrow Executive Director, Board of Directors SAUDI ENTERTAINMENT VENTURES

Jessica Herrera Economic & International Development Director CITY OF EL PASO

Winston Fisher CEO AREA15 FISHER BROTHERS

People are now craving experiences, conviviality, socialisation, education and new discoveries.

Cities and districts have to become better places to live. MAPIC is committed to embracing this change, which is why this new event is being launched at this specific time.

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Nathalie Depetro - MAPIC Show Director

Continue the fun at MAPIC! From November 13-15, come discover the latest fun experiences and leisure attractions at the MAPIC Leisure Zone. The Leisure Zone will highlight the latest leisure concepts for shopping destination thanks to a dedicated exhibition area, flash talks and workshops.

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Request your invitation: mapic.com/leisure Get in touch: caroline.renou@reedmidem.com

LEISURE DAY

The golden age Photo credit: David Wilkinson

of leisure

Culture club: Edinburgh is a city of festivals

The last few years have seen leisure go from an optional add-on to a mainstream retail proposition. As MAPIC launches its first full-day leisure event this year in Cannes, Mark Faithfull looks at how entertainment synergies are transforming both retail destinations and urban centres

T

HE ECONOMIC and cultural shift from things to experiences has revolutionised the way consumers spend their money and what they want from destinations. Shopping centres have begun to dramatically reformat, bringing in first unheralded levels of F&B, followed more recently by the integration of ambitious leisure schemes. The result is a new generation of lifestyle destinations, a plethora of new concepts and a resetting of the urban environment.

Reflecting these changes, Reed MIDEM, the event organiser

behind MAPIC and MIPIM, is launching its first global leisure event. Leisure Day will take place in Cannes on November 12, on the day before the curtain goes up on the main MAPIC market. But this is only part of the story, because the ambition is to create a much bigger, standalone event in 2020.

This year it will be a full-day event and will host leisure operators from across the spectrum, from e-gaming and theme parks to live music, museums, art galleries, wellness and food, as well as retailers, brand owners, suppliers, urban planners, media players, architects and property

developers. Leisure Day’s aim is to co-create new sustainable business models in order to build the lifestyle destinations of tomorrow.

The reasons are clear, given the huge shifts in consumer spending. According to Euromonitor International report Commerce 2040 – Revolutionary Tech Will Boost Consumer Engagement, consumers are already moving towards demanding personalised experiences. The report says that consumer expenditure on experiences is set to rise from €5.2tn this year to €7.1tn in 2030, including leisure, recreation, travel and food service.

MAPIC PREVIEW • 19 • October 2019

“The digital darlings of the first part of the millennium like Uber, Airbnb and Facebook rose to prominence by leveraging technology to connect consumers with providers and in turn introduced a new way of conducting business,” says Michelle Evans, global head of digital consumer research for Euromonitor. “The innovators of next-generation commerce for 2040 will face a different set of challenges. Outlets and venues will require not only a technological upgrade but a redesign to prepare for the consumer in 2040. Entertainment venues will deploy flexible designs to shift from one event type to another, with operators adjusting layouts to meet the need for different food and delivery options.”

“Finding the right proposition to entertain customers, create memorable experiences, drive retail and create loyalty is harder than ever,” says Helen Barnish, managing director of Entertain-

LEISURE DAY ing Retail, who warns that, with a plethora of new entertainment concepts, it is too easy to rush into a lease with the latest new format. Instead, she says that developers need to understand both the experiences their customers are looking for and analyse the entertainment models to assess which concepts will provide long term success.

“It is critical that demographics and customer habits are truly understood by location,” she says, adding that an array of questions need to be answered including usage outside weekends and holidays, entry pricing, annual passes and operation.

“Many concepts are created by design agencies but have no operational arm. The operation is essential to success,” she says.

“Are you willing to look at operating the format, or could the format be franchised, in which case, who will take the lease?

“Entertainment formats are quite static. If your audience is local and regular, then will they get bored with the format? Is a marketing/events calendar to be created and managed, and how

Virtual reality HYPD at intu Lakeside, UK

will this link to central marketing of a shopping centre location?

What are the plans to update the format and keep it fresh and invest in new elements?”

Examples of destinations changing already are all around, including the UK’s biggest current project, Edinburgh St James, at one end of Princess Street in the Scottish capital.

“Edinburgh is the world’s festival capital, with 11 festivals including the Edinburgh International Festival, the Edinburgh

Military Tattoo and the Edinburgh Festival Fringe, the largest arts festival in the world,” says Edinburgh St James development director Martin Perry.

“Edinburgh St James will build on this famous calendar of events with its nine event spaces and three public squares, with endless possibilities such as the creation of a new festival incorporated within the scheme.”

He believes that the scheme will shift perceptions of the city internationally, injecting over

EuropaCity, Paris has been conceived as Europe’s biggest leisure and cultural centre

MAPIC PREVIEW • 20 • October 2019

£1bn into its economy. “This investment brings Edinburgh in line with Europe’s biggest and best cities, repositioning Edinburgh as one of the most exciting, forward thinking and sought after destinations for retail and leisure operators in Europe,” he says.

In Paris the €3.1bn mega-project EuropaCity, proposed as a future gateway to the ambitious Grand Paris scheme, continues to evolve. The project’s partners describe it as a “unique place designed on a neighbourhood scale, connected to its near environment, dotted with human-sized public squares, combining nature and entertainment facilities”.

Conceived as Europe’s biggest leisure, culture, retail and entertainment village, the 80 ha scheme will include hotels, restaurants, shopping centres and concert halls, as well as parks, night clubs and bars. Initiated and backed by French supermarket group Auchan, it is being supported by Ceetrus and CCI Paris Ile-de-France. China’s Dalian Wanda Group came on board with a €3.1 bn investment in the project in 2016.

Dramatic changes can also be seen in the shopping-centre market. In the UK, Lakeside owner intu partnered with gaming company HYPD on a new gaming zone at the shopping centre, which is located on the periphery of London. Under the 12-month partnership, a 900 sq ft (83.6 sq m) store has been transformed into an immersive gaming experience.

The HYPD Arena — billed as a “celebration of all things gaming” — included an esports tournament, retro arcades and virtual reality attractions during its run from July 20 to August 31.

It formed part of the centre’s recent £72m leisure extension, which includes f a mi l y-enter tai nment

LEISURE DAY centre Nickelodeon Adventure, indoor mini-golf format Puttshack, Hollywood Bowl 10-pin bowling alley, trampoline operator Flip Out and food concept The Hall — the first shopping-centre location for Market Halls.

The HYPD Arena concept is set to be rolled out across more of intu’s shopping destinations over the next year, according to intu’s customer-experience director Roger Binks. “The gaming industry is experiencing explosive growth and popularity, making intu’s destinations the ideal locations for this kind of attraction,” he adds.

And it’s a trend that has not been lost on MAPIC. “As the digital revolution has caused consumer behaviours to transform, customers are now craving experiences, conviviality, socialisation, education and new discoveries,” says MAPIC director Nathalie Depetro. “Supporting prosperous leisure time will be a challenge for the entire industry, as cities and districts have to become better places in which to live. We are committed to embracing this change and creating new entertainment synergies, which is why this new event is being launched at this specific time.”

LINES BLUR BETWEEN LEISURE AND RETAIL “THE BORDER between attractions, retail and other types of leisure is becoming more and more difficult to define,” says Andreas Veilstrup Andersen, president and CEO of Swedish attraction-park operator Liseberg Group. “You can see in leisure that there is more F&B and retail, and that shopping centres are becoming more like attractions.”

Andersen, keynote speaker at MAPIC’s inaugural Leisure Day, has spent some 20 years on the frontline of the leisure in-

dustry, having worked for Copenhagen’s iconic Tivoli Gardens and international trade organisation IAPPA (the International Association of Amusement Parks and Attractions). “When I started, it was very easy to define your competition: other local attraction parks,” Andersen says.

“But things are changing very rapidly and, in my opinion, we will see destinations of all types competing with each other in the future.” This competition can be extended to “anything that replaces an attraction visit”, he adds,

citing poor weather as an example. On an inclement day, attendance at an attraction will typically go down, but footfall at the nearby shopping centre will go up.

“I foresee parallel investment in retail and attractions, as we invest in experience, F&B, retail and secondary gaming,” Andersen concludes. “The visitor is buying expectation, experience and memories, in the same way that a retail destination is really selling not product, but the experience and socialisation of shopping.”

Nathalie Depetro, MAPIC:

“Supporting prosperous leisure time will be a challenge for the entire industry — and we are committed to embracing this change and creating new entertainment synergies” In 2019, the Leisure Day will combine networking with a packed conference programme examining key topics, including emerging leisure concepts, screen-based entertainment

Keeping on track: Leisure is about expectation, experience and memories

and IP-based entertainment.

There will also be six ‘learning sessions’, with themes ranging from Becoming A Destination: Shopping Mall Repositioning With Entertaining Experiences to Developing A Leisure Concept, From Vision To Opening.

The keynote will be delivered

by Andreas Veilstrup Andersen,

president and CEO of Liseberg Group (see Lines Blur Between Leisure And Retail).

In addition to the Leisure Day, MAPIC itself will offer a series of leisure-targeted talks and workshops, as well as a dedicated Leisure Zone, where leisure exhibitors can meet with property players to dis-

MAPIC PREVIEW • 21 • October 2019

cuss leasing opportunities and new projects.

CONFERENCES & EVENTS AT MAPIC

LEISURE DAY (By registration only) Tuesday 12 November - 10.30-17.30 Martinez Hotel Cannes LEISURE WORKSHOP & FLASH TALKS Wednesday 13 & Thursday 14 November Leisure Zone - Level -1

LEISURE: F&B

Serving up something new Photo credit: Nitzan Rubin

It has not been the easiest year for some of the midmarket casual-dining formats. But, writes Mark Faithfull, there are plenty of operators proving that consumers still have a healthy appetite for the right F&B offers

MAPIC PREVIEW • 22 • October 2019

B

Time Out Market New York

MAPIC PREVIEW • 23 • October 2019

Y THE end of this year, entertainment publisher Time Out will have expanded from one to six Time Out Markets. One of the latest to open — Time Out Market New York — features 21 eateries serving up food from some of the city’s top chefs and restaurateurs, cocktails from renowned mixologists and cultural experiences by local talent, all handpicked by Time Out New York’s editorial team.

When it opened in May, Time Out Market New York became the latest food and culture destination to bring the best of a city under one roof. The New York venue is spread across 21,000 sq ft and two floors of the historic Empire Stores at 55 Water Street, Brooklyn.

“All the design work has been handled in-house and we have retained the same signage and branding throughout each Market, echoing the strong brand signposting in our publications,” says Jessica Parrish, Time Out Market’s commercial director. “However, each space is very architecturally different, so at each site we look at how we can best use the architecture and position. New York offers an amazing location and an iconic view.”

Parrish says the focus in the last year has been firmly on North America, where five Time Out Markets are being rolled out this year —in Miami, Boston, Chicago and Montreal, alongside New York. “As a result, we’ll be moving slower for the next couple of years as we take stock and evaluate these new sites,” she adds.

In practice, that means that, after Montreal opens in a collaboration with Canadian-based investor/developer Ivanhoe Cambridge towards the end of the year, openings will slow to one per year: Dubai in 2020,

Photos by: Yiu Tung Lee/123rf.com

018_ITA_PV_PIC

ITALIAN PAVILION INVEST IN ITALY MEET US AT BOOTH R8.C2 INVEST

IN ITALY

London in 2021 and Prague in 2022.

Over in the UK, French restaurant group Big Mamma entered the London restaurant scene in February with the bright and bold Gloria, located in trendy Shoreditch. This was followed by a second restaurant — Circolo Popolare in the Rathbone Square scheme in Fitzrovia — which opened in late June.

Founded in Paris in 2013 by Victor Lugger and business partner Tigrane Seydoux, Big Mamma operates seven trattorias in the French capital, as well as a food market — La Felicita — which claims to be the biggest restaurant space in Europe.

It also operates another restaurant called La Bellezza in Lille.

The group is looking to add one further restaurant to its chain in the early part of next year, before exploring a 2,000-4,000 sq m food market along the lines of La Felicita in London.

With nine different restaurant concepts, Big Mamma’s director of development, Jack de Wet, says the group has pursued a

Photo credit: Jerome Galland

LEISURE: F&B

Big Mamma is targeting multi-format, single cuisine expansion

philosophy of multiplicity, creating eateries that are not single format, but have the single offer of Italian cuisine.

Six appeal: Five Guys food is ready within six minutes

This year, burger chain Five Guys will open its 100th store in the UK, bringing its total portfolio across the UK, France, Spain and Germany to around 140 outlets. The aim of the Five Guys JV — a joint venture with the founding US business and Charles Dunstone, founder of Carphone Warehouse — is to open 10 stores per market per year over the next five years, according to Five Guys’ property director Richard Collier.

Collier ascribes the success of the US diner-style chain to the simplicity of its offer, which allows it to achieve great consistency and speed of service, and makes it one of the fastest options on ‘dark kitchen’ platforms such as Deliveroo and UberEats. “Essentially, we do one thing — burgers and fries — but we do it really well,” he says.

MAPIC PREVIEW • 25 • October 2019

“Typically, people have their food within six minutes and that means that Five Guys is usually part of a person’s day or night out, not the focal point. So people know what they are going to get, plus great service and our obsession with cleanliness.”

Richard Collier, Five Guys:

“Essentially, we do one thing — burgers and fries — but we do it really well. Typically, people have their food within six minutes” As Five Guys expands internationally, Collier says cultural differences are becoming more notable — such as the demand in Spain for food later in the evening and the high uptake of the free toppings in Germany.

Store sizes vary, from the 150

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LEISURE: F&B

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Dark kitchens: Deliveroo in London...

sq m outlet on London’s Portobello Road, which is the smallest to open, to the flagships in cities such as Frankfurt, which come in at 550 sq m.

“Our optimum store size is around 350 sq m, with high footfall,” Collier adds. “Because of evening demand, we tend to prefer urban high streets, so that we are not constrained by shopping-centre hours. Office populations, students and nightlife are all on our tick list.”

Currently, Five Guys is focusing on finding sites for standalone drive-up locations for click-andcollect, for which Collier foresees strong demand in the UK, France and Germany.

With a turnover of €2.05bn, nearly 2,000 restaurants and outlets — half under franchise — and a presence in 100 countries on five continents and 10 production plants, France’s Le Duff Group is a world leader in the coffee-bakery sector.

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Organised by:

MAPIC PREVIEW • 26 • October 2019

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LEISURE: F&B Founded more than 40 years ago by Louis Le Duff, the group operates a number of brands, including Brioche Doree, Del Arte, Fournil de Pierre, La Madeleine and Mimi’s Café, the latter two dedicated to French cuisine in the US. It also operates Kamps cafe bakery in Germany.

Meanwhile, Fauchon Hospitality, the new hotel division of Fauchon, has begun international development in the wake of the September 2018 opening of its first hotel in Paris’ Place de la Madeleine — the historic site of the famous delicatessen house.

It has already signed its first hotel project abroad, in Japan.

Fauchon has been in the Japanese market for 47 years and has 28 shops, two cafes and two bakeries in the country. Next year, it will open, a Fauchon L’Hotel, its five-star hotel brand, in the heart of Kyoto. The establishment will have 70 rooms and suites, a bakery, a Franco-Jap-

anese tea area and a gourmet restaurant called Grand Cafe Fauchon. The Fauchon Kyoto Hotel will be operated under license by Japanese company Wealth Management.

“The goal is not to make a copyand-paste of the Madeleine in Paris, but we will keep, of course, our French touch — our ‘gourmet’ connotation,” says Fauchon president Samy Vischel.

The Kyoto project is to begin in June and aims to be complete in time for the Tokyo Olympic Games. In parallel, Fauchon is continuing the development of its point-of-sale shops and cafes, with openings planned by the end of this year in Zurich Airport, Monaco, Dubai, Jeddah, Saudi Arabia and Qatar.

CONFERENCES & EVENTS AT MAPIC FOOD IN THE NEW MIX Wednesday 13 November - 14.00-15.15 Main conference room, Level -1

and UberEats in the United States

www.ingkacentres.com MAPIC PREVIEW • 27 • October 2019

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28-29 APRIL 2020 MICO - MILANO CONGRESSI, MILAN, ITALY

The global event for multi-site restaurant operators looking to grow their business Network and sign deals with the restaurant industry decisions makers!

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MAPIC FOOD RENAMES AS THE HAPPETITE MAPIC’s popular event dedicated to food and beverage in Milan is to be renamed The Happetite for 2020. MAPIC deputy director Francesco Pupillo tells Mark Faithfull how the event plans to welcome the whole world of F&B. A larger, broader and more diverse food and beverage (F&B) event will take place in Milan next year, as the popular MAPIC FOOD rebadges as the deliberately inclusive ‘The Happetite’.

The move represents much more than a simple name change and instead reflects an ambition to create an event that encompasses the entire F&B universe, allowing all the players to come together to discuss industry trends and look for expansion opportunities.

And no wonder that growth is on many operators’ agendas.

In Milan earlier this year, Francois Blouin, president of Food Service Vision, revealed new research that showed 82% of European consumers visit chains (on average 12 different chains annually), and that between 2014 and 2018 the number of chain outlets increased 17% in France and 22% in the UK, to name just two markets.

MAPIC deputy director Francesco Pupillo says that it

was this desire to create an environment where everyone from restaurant chains and operators to real estate professionals, private equity investors and restaurant industry suppliers could come together that encouraged the change in name.

“Today, the industry knows what MAPIC stands for very well,” he says, explaining that Cannes will continue to act as an important meeting platform for restaurant chains and landlords.

“To bring in new players to our world we wanted to make very clear that The Happetite is much more all-encompassing than a real estate-focused show and is instead the place where everyone in the sector can come and find the right people to talk to. It’s an opportunity for the whole F&B chain to gather,” he says.

To that end, The Happetite will include a significantly expanded exhibition area, welcoming a larger and broader range of

restaurant and dining operators to Milan, becoming the most important international global event dedicated to multi-site restaurant operators looking to grow their business.

It will appeal to restaurant chains, restaurant operators, travel operators, franchise partners, private equity investors, property players, food tech solution providers and restaurant industry suppliers.

“Since launching, we have been very successful at attracting the larger, international food groups from around the world but we want to introduce more regional operators, who perhaps, for example, run 10-15 restaurants in France, or Germany or in the CEE,” says Pupillo. “So, for 2020 attendees will be able to meet more exhibitors, take part in another fantastic conference programme and enjoy more tours, which will attract even more visitors.”

“To bring in new players to our world we wanted to make very clear that The Happetite is much more all-encompassing than a real estate-focused show” Francesco Pupillo, MAPIC

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i

Come to visit us Stand Palais -1 K61

LEISURE: FITNESS

The wheel deal: Peloton is expanding in the UK

Gym concepts

fit for the future Gym and fitness concepts are mirroring the early days of US retail expansion, crossing the Atlantic to London and using the UK capital as a bridgehead into mainland Europe. Mark Faithfull reports

A

HOST of often-US inspired fitness clubs and concepts are expanding into the UK, with many considering options to use London as a springboard into Europe, according to Josh Braid, partner, retail and leisure, Knight Frank. He points to the likes of US spin phenomenon SoulCycle and upscale club-style gym Equinox, both of which have used London as their European launchpad.

“The fitness market has evolved from the larger sports clubs to smaller units of 300-500 sq m,

often in urban locations on the way to or from people’s places of work,” Braid says. “That gives them a much wider choice of sites and allows them to provide a club-like fitness offer”

Josh Braid, Knight Frank:

“The fitness market has evolved from the larger sports clubs to smaller units of 300-500 sq m, often in urban locations on the way to or from people’s places of work”

SoulCycle, which has around 60 US locations, assessed possible London sites for around two years before its first opening and Braid believes the brand will have crossed into Europe within another two years, targeting locations such as Paris, Milan and Berlin.

“SoulCycle has been very clever, because it has established itself as a brand and it’s achieved celebrity endorsement, both of which are crucial in this market,” he adds. “More US brands are likely to follow and we’ll see more niche areas, such as rowing, martial arts, yoga, Pilates

MAPIC PREVIEW • 31 • October 2019

and high-end personal training.”

Cycling fitness phenomenon Peloton is to open its latest showroom in Hammerson’s Victoria Gate, part of its flagship destination Victoria Leeds, becoming the company’s sixth showroom in the UK and its first outside London.

Expected to open in Leeds this autumn, the new 1,000 sq ft (92 sq m) showroom will provide consumers with the chance to try the high-tech Peloton bike — a spin bike fitted with a screen that streams, among other content, on-demand fitness classes — according to Iain Mitchell, UK commercial director at Hammerson. “Peloton is a great example of a brand that is really making the most of its online and physical presence to deliver for customers.”

Braid also points to concepts such as US circuit-training for-

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See you in the Retailers Lounge Enjoy, an all-inclusive programme with a dedicated networking and relaxing space onsite to meet your peers.

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LEISURE: FITNESS mat Orangetheory Fitness, which he believes is likely to target the CEE markets, and high-impact concept F45 Training, which originated in Australia and operates on a franchise model. The latter is also actively looking at European expansion.

At the higher end is Equinox, an upscale format that typically takes sites of around 3,500 sq m and is a hybrid of a private-members’ club and a gym. The company launched a hotel concept in Hudson Yards, New York and Braid believes it will look at cities

such as Paris, Milan, Berlin, Munich and Hamburg for its move into Europe. “Again, there’s a very strong brand there,” he adds. “With the hotel concept, it will be looking for around 12,000 sq m of space in Europe’s major urban centres.”

CONFERENCES & EVENTS AT MAPIC

87%

of connected consumers report buying tickets for leisure and entertainment activities Source: Euromonitor International

COSMETICS & BEAUTY, HEALTH, WELLNESS... TO ADD VALUE & BRING BENEFICIAL SYNERGIES IN THE TENANT MIX Wednesday 13 November - 16.00-16.45 Main conference room, Level -1

3.4% in 2018,

with revenues of €27.2bn and total memberships at

62.2 million.

Source: European Health & Fitness Market Report, Deloitte and EuropeActive

The Eiffel Tower is the world’s most popular attraction, according to Instagram, ranked as the social media platform’s most tagged attraction.

THE START OF A NEW STORY NOT EVERY shopping centre or vacant department store needs to become an amusement park. Or museum. Or sports centre. It could be one of the above — or something else entirely.

What’s important is the experience and the story it tells, according to Fri Forjindam, chief development officer of Mycotoo, a Pasadena, California-based development company that creates location-based and live entertainment.

“Every region is different,” she adds. “Most communities can’t afford a billion-dollar investment in a traditional theme park, but people want something more sophisticated than a putting course.” This can include licensed entertainment, creating something original or a combination of both. In Austin, Texas, for example, Mycotoo worked with Giant Spoon and US pay-TV channel HBO to create the Westworld

The European health and fitness market grew

The top 20 tourist sites around the world are: 1 – #eiffeltower – 5,849,737 2 – #lasvegasstrip – 4,802,560 3 – #timessquare –3,949,217 4 – #burjkhalifa – 3,502,116 5 – #grandcanyon – 3,433,049 6 – #bigben – 3,007,317 7 – #londoneye – 2,980,066 8 – #louvre – 2,897,989 Mycotoo’s Westworld concept, Austin, Texas

Experience. The immersive walkthrough experience recreates the town of Sweetwater, the main town of the hit HBO drama.

Mycotoo has also worked with the city of El Paso, Texas, to create an entertainment district.

Another of the company’s concepts is the ‘family room,’ which recreates the nostalgia of a family gathering to watch television, play board games and eat comfort food.

Mycotoo is currently working with five major

developers in the US and Canada to roll out entertainment to multiple centres. “At the end of the day, it’s about emotional connections and community associated with like-minded interests,” Forjindam says, adding that both brands and retail centres are recognising the need to create touchpoints that resonate with consumers: “It’s business, but it’s also good storytelling.”

By Debra Hazel

MAPIC PREVIEW • 33 • October 2019

9 – #goldengatebridge – 2,645,651 10 – # empirestatebuilding – 2,598,694 11 – #towerbridge – 2,127,742 12 – #sagradafamilia – 1,830,206 13 – #statueofliberty – 1,820,337 14 – #colosseum – 1,552,294 15 – #machupicchu – 1,539,713 16 – #tajmahal – 1,260,502 17 – #cntower – 1,249,873 18 – #buckinghampalace – 1,127,083 19 – #acropolis – 1,109,978 20 – #arcdetriomphe – 948,133 Source: Instagram

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Accelerate your business thanks to our portfolio of international events

13-15 November 2019 Cannes

21-23 April 2020 Moscow 28-29 April 2020 Milan

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September 2020 Mumbai

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MAPIC AROUND THE WORLD

MAPIC around the world MAPIC events have taken place around Europe and Asia again this year, with highlights including the co-located MAPIC Italy and MAPIC FOOD in Milan, a new venue for MAPIC Russia and the first Meetups in Asia

DATELINE: MAY, MILAN

MAPIC FOOD: Appetite grows for F&B

T

HE SECOND edition of MAPIC FOOD saw exhibitors arrive in Milan with cuisine from around the world to tempt delegates. Off the exhibition floor, a wide array of topics, from community to delivery, was also on the menu. One of the key conclusions was that the industry needs to stop talking about rents and focus on what both landlords and operators can

bring to destinations. However, there is still a lot of work to do to persuade independent-minded food operators that the mall could be their home.

“Landlords need to stop focusing on rent and consider the attractiveness of their centres,” said Jonathan Doughty, global head of foodservice, leisure and placemaking at ECE Projektmanagement. Discussing the prospect of attracting an F&B offer such as quirky French pizza operator Big

Mamma, which does not want to locate in malls, Doughty added: “We don’t want to change the operator. We have to change — or change what we offer. We have to stop looking to the past.”

Jack de Wet, director of development at Big Mamma Group, responded with the observation that creating quality and sustainability takes time. And while he did not discount a differentiated landlord location in the future, he said: “We need to look at

Food to dine for: Sampling at MAPIC FOOD

venues that work for our concepts, which may not be traditional buildings or locations.

That might not be what everyone wants to hear.”

However, European consumers seem to love food chains. Francois Blouin, president of Food Service Vision, unveiled new research for MAPIC FOOD showing that 82% of European consumers visit an average of 12 different chains annually. He added that, between 2014 and 2018, the number of chain outlets increased by 17% in France and 22% in the UK. The dark-kitchens session was

Dark kitchens debate: A booming F&B sector

MAPIC PREVIEW • 35 • October 2019

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MAPIC AROUND THE WORLD the busiest of the entire conference programme, reflecting the fact that delivery-only restaurants are clearly the topic of the moment. Views differed on the way forward and even the name of the phenomenon — super-kitchens has been suggested as an alternative — but there was consensus that this is a major growth opportunity.

Europe could host as many as 5,000 dark kitchens servicing 200,000 restaurant brands within five years, according to Stephane Ficaja, regional general manager for Northern and Southern Europe at Uber Eats.

He predicted that improved efficiency would make dark kitchens part of the industry’s future: “This is a massive opportunity.

Delivery is something where all the fundamentals are here. Online food delivery is outpacing the rest of the market, with dark kitchens offering lower capex

investment, operational excellence and brand product agility.”

Stephane Ficaja, Uber Eats:

“Online food delivery is outpacing the rest of the market” Deliveroo’s Ajay Lakhwani, global vice-president, commercial, was slightly more cautious about the rate of expansion.

However, he believed the company’s Deliveroo Editions super-kitchens had “brought faster and a more reliable delivery” to the market. He also pointed to expansion beyond Europe to territories including Singapore, Dubai, Hong Kong and Australia.

Consultant Peter Backman described dark kitchens as “a global phenomenon at its early stages”. He added that, while the

MAPIC FOOD renames as The Happetite MAPIC’s popular event dedicated to food and beverage at the MiCo in Milan is to be renamed The Happetite for 2020.

A larger, broader and more diverse food and beverage (F&B) event will take place 28-29 April 2020, rebadged as the deliberately inclusive ‘The Happetite’. The move represents much more than a simple name change and instead reflects an ambition to create an event that encompasses the entire F&B universe.

The Happetite will include a significantly expanded exhibition area, welcoming a larger and broader range of restaurant and dining operators to Milan, becoming the most important international global event dedicated to [logo happetite] multi-site restaurant operators looking to grow their business.

eventual shape of the market could take several forms, there is little doubt that it will have a major impact on the F&B sector. “My concern is that, when the market gets big enough, the big players will be bashing against each other and that will drive prices down,” he warned.

CONFERENCES & EVENTS AT MAPIC

FOOD IN THE NEW MIX Wednesday 13 November - 14.00-15.15 Main conference room, Level -1

DATELINE: FEBRUARY, LONDON — A NEW FORMULA FOR FOOD? NEW SCHEMES can win on food — but only if they get the model right.

“The approach for a new project in 2019 is completely different from the past,” Derek Rossel, development director for Hines, told the audience at the Soho Hotel, London, during a buzzing MAPIC FOOD preview night in February. “It’s no longer about chains,” Rossel added. “You need to attract the right independents and work with them to help them build their business.”

The importance of collaboration was raised several times during the panel debate, notably by Same Sethi, principal and di-

rector of Insite Food, and Neelofar Khan, director of seven-store Indian wrap chain Zabardast. Khan, whose company operates in and around London, said that landlords need dedicated F&B managers to co-ordinate with their F&B tenants if they wanted them to perform to their best ability. She also stressed that this is a very different role to that of a retail manager.

Sethi agreed, saying that bringing in fresh F&B offers needed to be fed through the management chain and not just exist as a “grand vision” at the top of a business. “It’s vital that the leasing team understands the strategic

role of F&B and doesn’t revert to bringing in the same old names, who don’t complement the retail offer,” he added.

“It’s also important to support F&B operators to help them adapt to what

might be their first physical store or first mall outlet. They need assistance to ensure they create the right experience for their customers.”

The MAPIC FOOD preview in London

MAPIC PREVIEW • 37 • October 2019

By Mark Faithfull

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DATELINE: MAY, MILAN

MAPIC Italy: A market in transition The fourth edition of MAPIC Italy brought together investors, developers, retailers and F&B specialists to debate one of Europe’s most interesting markets. Mark Faithfull reports.

MORE THAN 2,200 participants from 40 countries came to Milan this year for MAPIC Italy and MAPIC FOOD. With 850 retailers and 400-plus F&B brands, visitor numbers were up by an impressive 10% on last year.

There were a number of key takeaways from MAPIC Italy: the Italian market is cautiously optimistic, despite challenging conditions; the impact of digital retail is increasing, despite historically lower adoption; high streets remain popular, with investors searching for product; leisure is a growing market as malls reinvent their offers; and, according to industry body CNCC, shopping centres are focusing on becoming social hubs in a bid to get around potential restrictions on Sunday trading.

Among the key players from the Italian retail real estate sectors to attend the fourth MAPIC Italy were JLL, CBRE, Cushman & Wakefield, Ceetrus, Grandi Stazioni Retail, Savills, ECE, Eurocommercial, IGD, Svicom, Sonae Sierra and Klepierre.

Sentiment was cautiously optimistic during the opening session, organised with CNCC.

CNCC’s Massimo Morretti

“The shopping-centre industry is in transformation, but [that transformation is] based on solid fundamentals and with clear ideas on where to go. Food, together with leisure and services, are some of the topical elements of this transformation. In our food courts, for example, the offer is increasingly rich and attentive to new trends and customer tastes,” said Massimo Moretti, president of CNCC Italy.

Joachim Sandberg, head of Italy and Southern Europe at Cushman & Wakefield, added: “There is no apocalypse — the shopping centre is not dead but is undergoing a great transformation in terms of format and value, with a repricing in action. The increased uncertainty and volatility surrounding the future of the mall continues to keep core investors away, while offering opportunities for investors willing to take a greater risk. This is being reflected in yields, which have already started to grow in Europe, reaching just under 5% in 2018. For the future, we expect the sector to return to attracting more core capital once the transformation is complete.”

Joachim Sandberg, Cushman & Wakefield:

“There is no apocalypse — the shopping centre is not dead but is undergoing a great transformation” Pierre Marin, CEO of JLL Italy, pointed out that retail real estate is a changing asset class: “In the future, we will talk more and more about hybrid projects, aimed at responding to the needs of retailers, who in turn are significantly changing their business model. At the same time, as far as the investment market is concerned, we expect — with the right repricing — a consolidation of domestic capital, as well as a return on international capital for retail real estate”.

Alessandro Mazzanti, CEO of CBRE Italy, added: “The current evolution of Italian retail represents a great opportunity to further modify and enhance commercial properties, making them more and more attractive

for families and consumers by meeting their needs for consumption and entertainment.”

In MAPIC Italy’s final session — When Retail Meets Entertainment: The New Shopping Destinations — a panel of retail heavyweights discussed the profound changes that are affecting shopping centres as they broaden their offer from retail to include lifestyle and leisure experiences.

Mauro Gelmetti, general manager of Leisure Group Italia (Dedem Group), which specialises in entertainment for the three- to 14-year-old demographic, made a particularly significant point: “The new frontier of leisure is to provide ever greater areas — even up to 1,500 sq m — within which there is a mix of proposals and services, with the integration of content that adds value to the edutainment side as well.

“The aim is to create modular spaces with segmented proposals for different age groups and the support of high-level technologies.”

Mario Resca, president of Confimprese, added: “We have always lived in a customer-centric environment, but we need to learn from operators like Amazon, which has a customer obsession.”

CONFERENCES & EVENTS AT MAPIC SNAPSHOT ITALY Thursday 14 November - 17.45-19.15 Main conference room, Level -1

Cushman & Wakefield’s Joachim Sandberg MAPIC PREVIEW • 39 • October 2019

MAPIC AROUND THE WORLD

MAPIC ITALY 2020 MAPIC Italy will return for its fifth edition at the MiCo in Milan with the earlier dates of 28-29 April 2020 and once again it will be co-located with the renamed The Happetite F&B event.

Firmly established as one of Italy’s premier real estate events during the year, MAPIC Italy is designed to appeal to those investing and developing retail destinations in the country or expanding their retail formats, with a mix of an exhibition, tours and an extensive conference programme.

Italy remains a strong retail market and Massimo Moretti, president of CNCC Italy, said at this year’s event: “The shoppingcentre industry is in transformation, but that transformation is based on solid fundamentals and with clear ideas on where to go.”

MAPIC Italy attracted investors, developers and retailers

DATELINE: APRIL, MOSCOW

MAPIC RUSSIA: New venue, new faces MAPIC Russia moved to the Crocus Expo exhibition complex this year, as a record number of visitors from 28 countries converged on the Russian capital to discuss new opportunities across the country and region. Report by Natalia Antokhina MAPIC Russia took place in Moscow between April 16-18 and attracted more than 5,700 participants from 28 countries — up 7% on last year. Some 100 exhibitors from five countries and 30-plus new companies exhibited at MAPIC Russia for the first time this year.

The event consisted of three busy business days, including a retail real estate conference featuring 56 high-ranking speakers, nine partner events, pitching sessions, on-stand presentations by key players and the prestig-

ious MAPIC Russia Awards.

For the first time in 2019, MAPIC Russia was hosted in the Crocus Expo exhibition complex, boosting efficiency and convenience for both visitors and exhibitors. Among the companies presenting their projects were FortGroup, RRG, Rusich Group, JLL, Hines, Cushman & Wakefield, Malltech, AND Development, Garant Invest, Ceetrus, Ingka Centers, Mall Management Group, Dream Island (Regions Group), ADG Group and Lenta.

Visitors numbers to MAPIC Russia were up 7% on last year

Conference speakers, meanwhile, included SRV Russia’s Patrik Sjoberg, Ingka Center Russia’s Maria Butonaeva, Tele2’s Anton Kondratov, Tigrus Hospitality Services’ Henrik Winther, Fashion House Group’s Brendon O’Reilly, Central Kids Store’s Maria Shulutko, AMRO Group’s Andrey Ogorodov, Munitor Gruppe’s Waldemar Weiss and DARS Development’s Anna Khlyzov.

For the third consecutive year, MAPIC Russia also organised a tour of local shopping centres

for international retailers. Representatives from major Japanese, Swiss, Italian and French brands visited four shopping centres in Moscow — Oceania, Aviapark, Metropolis and Vegas — to gain an inside view of the opportunities available in the Russian market.

On the winners’ podium at the MAPIC Russia Awards were Outlet Village Pulkovo (best new shopping centre), Metropolis (best operating shopping centre), Moscow Central Market (best new retail concept), Bravery Market X Tsvetnoy (best pop-up retail concept) and Arena Space (best leisure and entertainment retail concept.

CONFERENCES & EVENTS AT MAPIC

SNAPSHOT RUSSIA Wednesday 13 November - 10.15-11.00 Main conference room, Level -1

INGKA Centers was among the major retail exhibitors

MAPIC PREVIEW • 40 • October 2019

MAPIC AROUND THE WORLD

DATELINE: JUNE, SHANGHAI SHAKING HANDS WITH CHINA TOGETHER with Savills, Retail in Asia and Leiden Business Academy, MAPIC organised its first Chinese MAPIC Meetup at Savills’ Shanghai office in June.

The event saw some 60 Chinese and international retail and retail real estate players come together to discuss how to build and re-shape lifestyle destinations to suit the changing face of retail in China.

Speakers included representatives from Savills,

DATELINE: JULY, LONDON FLIGHT TO LEISURE

Area-17, YellowKorner and Alibaba department store chain Intime.

By Julie Li and Yue Lian

Shanghai: China debut for MAPIC Meetup

DATELINE: JUNE, SEOUL SPOTLIGHT ON SOUTH KOREA MORE THAN 60 Korean retail and retail real estate players attended the first MAPIC Meetup to target the South Korean market, which took place in June at the COEX International Hotel. Among those interested in exploring how MAPIC can help with their business development strategies were leading market players Lotte, Shinsegae, Hyundai and

Samsung. In addition to introducing MAPIC to the Korean market, Savills and Cushman & Wakefield Korea offered an insight into key market trends. This was followed by a panel session featuring executives from STS Development, Muji and Decathlon Korea, who explored the changes and challenges of the Korean retail market.

By Julie Li and Yue Lian

DARTS concept Flight Club hosted a networking event in London to promote the new leisure event that runs the day before MAPIC in Cannes.

The venue is part of UK developer Land Securities’ revamped Nova scheme in Victoria, London, whose vibrant mix of retail and leisure — to quote Francesco Pupillo, deputy director of MAPIC — “represents the new era” in retail.

Paul Barham, co-founder of Flight Club, said: “Competitive socialising has become very important because people like to be entertained, drink and play. So it’s about making play accessible. For Flight Club, it’s about getting the technology in, but it’s also making sure that technology is not noticed.

Innovation is key.”

David Atcherley-Symes, retail leasing director

of Landsec’s London Portfolio, recalled that the team had pushed hard for Flight Club to be introduced into the scheme. “It’s not easy to take an offer like Flight Club to the board, but we believed it was right for the catchment and really pushed for them to join us,” he said. “The concept behind Nova is to create a new Victoria, but also to recognise that, between the Kings Road and the West End, it did not need to be a major retail centre, but instead full of what we call ‘useful retail’.”

Discussing the introduction of leisure as a whole, Yael Coifman, founding partner at Leisure Development Partners, added: “Entertainment gets people together, but attractions should not be viewed as tenants but as partners.”

By Mark Faithfull

Attendees discussed the Korean marketplace

The Leisure Day preview took place at Flight Club, London

CONFERENCES & EVENTS AT MAPIC

CONFERENCES & EVENTS AT MAPIC

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MAPIC PREVIEW • 41 • October 2019

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REGIONS: FRANCE, UK AND GERMANY

All change in Europe’s big three markets The arrival this summer of Microsoft’s first European flagship in London is symptomatic of a changing real estate landscape that is reshaping the continent’s major retail markets and urban centres. Ben Cooper reports

A

FTER years of rumours, planning and eager anticipation, in July Microsoft finally opened the doors to its grand new flagship store in London — the first of its kind in Europe but, surely, not the last.

Situated in the epicentre of London shopping, Oxford Circus, the store is bristling with the kind of details in which modern shoppers, and retail experts, are interested. There’s the

gaming lounge, where Microsoft is preparing to host whole video-game tournaments, the Surface Design Lab, the Windows Mixed Reality area, where users can try out wearable AR devices, a community theatre — a classroom-style area for hosting workshops and training events — and even a McLaren Senna supercar, powered by an Xbox One X for a simulated F1 driving experience. As senior store manager John Carter said just before the new shop

opened: “This is more than a store — it’s a destination, right in the heart of London.”

The opening was significant for a number of reasons, not least because UK retail has been going through torrid times. The British Retail Consortium and KPMG revealed that June and July retail sales were the worst on record, as UK consumer confidence was hit by ongoing Brexit concerns on top of the other long-term challenges, which have seen a raft of well-

Microsoft’s flagship store in the heart of London’s West End

MAPIC PREVIEW • 43 • October 2019

known names close down or shut multiple stores.

So Microsoft’s decision to choose the UK, one of the most advanced ecommerce markets outside the US, for its first European opening was a genuine boost. The sheer scale of investment that Microsoft was willing to make into the property is a huge vote of confidence in the power of the physical store, backing up research published in July by market intelligence firm CACI into the ecommerce ‘halo effect’, which revealed a 106% uptick in online sales in the area surrounding a bricks-and-mortar shop.

But perhaps the most telling sign is the amount of space within the new Microsoft store given over to experiential features. In a recent survey for advisor Savills, 78% of millennials said they would rather spend money on an experience than buying “stuff ” — and it’s this factor, perhaps above all, that is driving the change in retail property around the world.

Another previously distinct line that’s becoming increasingly blurred is the one between online retailing and physical space. Fears that ecommerce would lead to the death of the high street have not been realised, as high profile openings like Microsoft’s London store demonstrate. In fact, as CACI’s research shows, ecommerce is presenting a vital new role for bricks-and-mortar retailing.

As well as revealing a clear rise in ecommerce sales in areas where a retailer has a physical presence — as high as 154% in electronics and 127% in fashion — CACI’s data also reveals the importance of the ‘try before you buy’ visit to a shop. Indeed, half of ecommerce spend touches a physical store at some stage of the transaction. This, according to John Platt, director at CACI’s Property Consulting

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REGIONS: FRANCE, UK AND GERMANY Group, highlights the need for landlords to make their malls and high streets as enticing and varied as possible. Just because somebody is in a shopping centres does not mean their primary reason for being there is shopping, Platt adds: “Today, shopping centres are more than just places to carry out transactions. They are also about F&B, leisure and services, and that’s going to get more and more important. Physical retail destinations are going to change and evolve.”

John Platt, CACI:

”Today, shopping centres are more than just places to carry out transactions. They are also about F&B, leisure and services, and that’s going to get more and more important” With this evolution in mind, investor Nuveen Real Estate is working on a centre that goes well beyond shopping. Even in a city as culturally rich as Scottish capital Edinburgh, the home of the world-famous festival that bears its name, Nuveen is

Edinburgh St James: Retail, leisure, culture and residential

planning to add to the mix. As part of the overall 850,000 sq ft (78,967 sq m) masterplan for the new Edinburgh St James centre, which includes 85 new retail stores, more than 30 new restaurants and an Everyman Cinema, Nuveen is creating public spaces with the flexibility to host cultural events, performances and community-led activities. “As part of our events

The revamped Gropius Passagen in Berlin

strategy, we are reviewing a number of potential festival options to bring to life the nine events spaces across Edinburgh St James,” adds Martin Perry, Nuveen’s director of development, real estate, Europe.

While it is UK shopping centres and high streets that are most affected by changing consumer habits, another key sector of retailing — outlet centres — is also evolving with the times.

Giles Membrey, managing director of Rioja Developments, which is currently on site to deliver the future Grantham Designer Outlet Village in Lincolnshire, says: “From a concept point of view, the recent trend for outlets has seen an increase in F&B offerings, with the perceived ideal split between F&B to other categories moving from around 5% of space to 15%-25%.

Most commentators see this as an inevitable result of outlet shopping itself having always been a lei-

MAPIC PREVIEW • 45 • October 2019

sure activity. It’s only been more recently that developers and operators have reached the conclusion that F&B is now a draw for visitors.”

The German retail market is facing similar challenges. German retail sales took a bigger battering than expected in July, retreating from a gain recorded in June to reveal the biggest drop this year. Seasonally adjusted sales in real terms fell 2.2% compared with June, the biggest decline since December’s 2.9% drop. The figure though was 4.4% higher than a year earlier, while for the first seven months of this year sales rose 2.8% in real terms, according to the German statistical office Destatis. Since February, monthly retail sales figures have either declined or been flat, with the exception of a relatively robust 3% gain in June.

Facing these issues, Germany has also undergone its own evolution — to the extent that, according to Jennifer Guleryuz,

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REGIONS: FRANCE, UK AND GERMANY senior research consultant at Savills in Berlin, traditional concepts of mall layout and design are being challenged.

“You don’t always have a typical anchor now,” she says. “The shopping centre is not dead, but it’s not the shopping centre that we used to know. It’s about new ideas and products and concepts like VR. The whole point is to generate more footfall.

One of the major trends is the shift towards mixed-use space.

It’s about transformation. You could also question whether ‘shopping centre’ is the right term anymore.”

Jennifer Guleryuz, Savills:

“The shopping centre is not dead, but it’s not the shopping centre that we used to know. You could question whether ‘shopping centre’ is the right term anymore” The German capital has a remarkable array of retail spaces — some 70 shopping centres or smaller mall spaces in total — which means that developers are having to go to great lengths to compete. To see how this is playing out in reality, you just need to look to the work that TIAA and CNP, joint owners of Gropius Passagen in Berlin, with investment manager Nuveen and Unibail-Rodamco-Westfield as shareholder and centre manager, have been doing to revamp the centre.

Gropius, which offers a range of non-retail uses from job fairs to book-reading workshops for children, encapsulates the new way of thinking in retail property, says Frederik Sarnes, Nuveen’s retail asset manager for Germany. “What we’ve been doing with all these assets but particularly Gropius is to see

ECE’s Alexander Otto

the way the market is changing,” Sarnes adds. “Previous retail concepts don’t work in the way that they’ve been working before. You have to react to remain relevant. We see that changing these retail concepts is a very crucial point, especially with the leisure element. We try to implement these mixed-use elements and look at refurbishments and restructuring.”

Meanwhile, German online retailer Otto and European shopping-centre developer and land-

lord ECE have formed a joint venture, Stocksquare, to link online and offline shopping. The cross-channel bridge between brick-and-mortar retail and ecommerce will allow the product ranges of local retailers and manufacturers to be added to the product offering on otto.de.

The objective is to boost offline sales at ECE shopping centres and beyond through greater reach, while expanding Otto’s online selection by including local suppliers. The new services are initially available to the store networks of retailers who operate shops in one of the circa 90 ECE centres in Germany. The project launched with selected retailers on board, including Marc O’Polo, Reno and Ulla Popken. Additional services, such as nationwide same-day delivery, are also planned.

“The shopping experience of the future will take place both online and offline,” says Alexander Otto, CEO of ECE. “In this joint project, we are combining our knowledge from both worlds and enhancing brick-and-mortar retail by expanding its reach online. In

the process, we can draw on our long-standing partnerships with major retailers and our dense network of shopping centres, as well as the omnichannel approach of our Digital Mall project.”

Alexander Birken, CEO and chairman of the Otto Group, adds: “Together with ECE, we have the opportunity to partner with brick-and-mortar retailers and brands throughout Germany and integrate products from the single largest network of shopping centres in the country into the otto.de platform.”

Back in the UK, Rebecca Ryman, regional managing director at intu, points to leisure as a key trend. The British shopping-centre giant has just completed a major extension of its leisure offer at its Lakeside centre in Essex, attracting Nickelodeon Adventure and indoor mini-golf experience Puttshack in the process.

Ryman says the market has dictated the direction that intu has taken in its strategic planning: “One of the big drivers for us over the last three to five years has been to improve the leisure

A major leisure-focused extension has taken place at intu’s Lakeside centre in Essex, in the UK MAPIC PREVIEW • 47 • October 2019

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REGIONS: FRANCE, UK AND GERMANY offer. Lakeside isn’t just a building with different retail brands in it: it’s a resort more than a shopping centre. We’ve been keeping a very close eye on consumer trends and we get inspiration from all over the world.

One of these is ‘competitive socialising’, so we have brought in concepts like Puttshack.”

Rebecca Ryman, intu:

“Lakeside is a resort more than a shopping centre. We’ve been keeping a very close eye on consumer trends and we get inspiration from all over the world” It is what Marie Hickey, director of commercial research at Savills, describes as the “gamification of the public realm”.

She adds: “It’s a question of how you make the retail experience better. We’re discussing

French developer Apsys’ new scheme Bordeaux Saint Jean

this a lot with the big landlords. We’ve found that spend on experiential features has increased significantly since 2009 — concepts like Hero Entertainment from China, Aus-

tralian VR gaming brand Zero Latency, free-roaming gaming systems like The Void [which has signed a multi-centre deal with Unibail-Rodamco-Westfield] and pop-up experiences

The Sant Boi Xperience centre in Barcelona

MAPIC PREVIEW • 49 • October 2019

like Happy Place. And what’s interesting is that a lot of these new concepts don’t need huge amounts of space.”

Darren Williams, founder of retail consultancy DW Exec, says this is not just a question of being on trend: it’s an existential threat for the retail property industry.

“A bit of a malaise seems to have set in across physical space in Europe and in the US,” Williams adds. “Physical stores seem tired and they seem to have lost a bit of their meaning. Shopping-centre owners are looking to new formats to fill their vacant space. Competitive leisure and F&B are hot at the moment — concepts like Flight Club and crazy-golf brand Swingers.

It’s the blending of hospitality with competition. These formats are taking ex-retail space and changing it into F&B competitive space.

We’ll see more of that. Retail and hospitality used to be well defined industries.

Now, they are well and truly blurred lines.”

REGIONS: FRANCE, UK AND GERMANY Darren Williams, DW Exec:

“Competitive leisure and F&B are hot at the moment. These formats are taking ex-retail space and changing it into F&B competitive space. We’ll see more of that” While it faces similar challenges, France is faring somewhat better. Advisor Cushman & Wakefield suggests stability for prime small units and a decrease for medium and large units. An upward trend can be noted on luxury high street and new generation retail parks. As a result, it predicts stability for super-prime assets and an upward trend for secondary shopping centres, which are suffering from decreasing footfalls.

A good development pipeline exists, although Cushman & Wakefield notes that future supply has been readjusted downward because of restrictive planning laws and strong competition between retail locations. Yet demand remains stable in prime and core locations.

Many of the new mall developments in France are also reflecting the changing retail landscape. French shopping-centre developer and owner Apsys is actively working to refresh its portfolio, which has expanded since MAPIC 2018 with the opening of the mixed-use Eden retail park in the Seine-et-Marne area south east of Paris. The developer is also active on one of the most significant new builds anywhere in France — the Bordeaux Saint-Jean scheme. As well as offering a complete mix of uses, from office and retail to hotels and leisure — even bars and discos — the centre will include no less than 10,000 sq m of new public-realm space right

Altarea Cogedim’s Cap3000 in Saint Laurent du Var — extensions are doubling its size

in the heart of Bordeaux.

This public area represents a major component of the project, but Apsys’ marketing director, Eleonore Villanueva, says that changing consumer priorities demand that developers think much more about the overall offer they are providing, especially in terms of non-retail space. “The major trends in shopping centres, entertainment, food, offer mix and public space all contribute to making shopping centres more and more like ‘lifestyle centres’,” she adds. “When you go to a shopping centre, it’s not just about shopping: it’s about seeing things you don’t see elsewhere and being entertained.

And at Apsys we have a lot of imagination when it comes to creating original events for our customers.”

Also showcasing its retail offer at MAPIC is the metropolis of Greater Nancy, which has a catchment area of 650,000 inhabitants, serviced by 450,000 sq m retail sales area, along with a low vacancy rate of 6.4% in the city centre. Central to this is the Saint Sebastian shopping

centre, which offers 107 commercial units and a permanent food market consisting of 80 shops. The city offers outstanding heritage buildings, including the Vaxelaire stores and the Belle Jardiniere, with Art Nouveau features, 19th century facades, stained-glass windows and 18th century staircases.

“These elements are now sought after by retailers in terms of the cachet they bring and how they help enhance the experience for customers,” says Cyrille Thiery, retail investment expert at Agence Scalen, the Greater Nancy and Nancy city economic development agency.

Metropole du Grand Nancy offers tailor-made support to retailers wishing to set up shop in the region, including premises research and assistance with recruitment.

French developers also continue to be active. By 2021, for example, Ceetrus plans to have opened 80 new centres or extensions, and reports that it has 1.2 million sq m of projects in the pipeline. This record level of investment in France, Eastern Europe and Asia includes

MAPIC PREVIEW • 50 • October 2019

a number of large-scale projects, with 10 sites of more than 50,000 sq m. The company will invest more than €1.9bn in the development and improvement of its retail parks by 2021 and €1.2bn on other activities.

Meanwhile, Ceetrus’ strategy of dynamic asset management has resulted in the transfer of more than €2bn worth of assets since 2013. The developer is also focusing on increasing the value of its portfolio by enhancing its sites with retail, offices or residential complexes. New schemes include redevelopment by architect Chapman Taylor of Barcelona’s Sant Boi Xperience, a 14,500 sq m, semi-open-air centre that includes leisure, catering and retail and is linked to the Sant Boi shopping centre; and the 57,000 sq m Cloche d’Or in Luxembourg, which consists of 250 apartments, 140 shops and a 12,500 sq m Auchan ‘new generation’ hypermarket.

Altarea Cogedim is also honing its focus on what it calls the most “resilient and promising formats” in retail. These include regional shopping centres in “exceptional” sites, such as

REGIONS: FRANCE, UK AND GERMANY

AXA Investment Managers bought a 75% stake in Italie-Deux, Paris

Cap3000 and Ferney-Voltaire, train stations, retail parks with secure rents and convenience stores. In terms of its existing assets, the group says that it has no specific disposal targets.

In the first half of the year, Al-

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tarea Cogedim acquired the retail concessions at five Italian stations, including Milan’s Porta Garibaldi. Under the deal, the developer will be responsible for the management and renovation and/or extension of the retail ar-

eas of these stations until 2041.

Three assets were also sold for a total of €122m, including the retail park 14e Avenue in Herblay, on the outskirts of Paris. The group’s shopping-centre pipeline consists of 12 building or extension projects, and nine retail projects that are being developed as part of larger mixed-use schemes.

In other Altarea Cogedim news, the final phase of the five-year Cap3000 extension on the seafront in Nice started earlier this year. When complete, the centre will have doubled in size to offer 135,000 sq m of fashion outlets, services and restaurants. Works are also nearing the end on the second tranche of the retail outlets at Paris’s Montparnasse station, with delivery planned at the end of this year.

Hammerson, meanwhile, is continuing with its non-core disposal programme. In July, it

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MAPIC PREVIEW • 51 • October 2019

exchanged contracts with AXA Investment Managers – Real Assets to sell a 75% stake in the Parisian shopping destination Italie Deux and the forward sale of 75% of the Italik extension for a total of £423m (€473m), reflecting a yield of 4.1%. The sale brings Hammerson’s 2019 sales programme to £456m, representing 90% of its £500m target for the year. AXA IM also bought a €203m in a stake in Passage du Havre from Eurocommercial Properties.

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REGIONS: THE NETHERLANDS

Westfield Mall of the Netherlands will feature 280 stores, restaurants and leisure outlets

Fresh concepts find favour

A

MSTERDAM has long been synonymous with fashion brands. It has also been one of the European cities to benefit the most from the impact of Brexit uncertainty on London, attracting increased investment in its offices and industrial markets. Retail, however, has enjoyed a mixed 12 months, with Japanese fast-fashion retailer Uniqlo debuting in Amsterdam in October last year, taking over the former flagship of fast-fashion chain Forever 21, which closed its Amsterdam store in early 2018.

Uniqlo unveiled a 2,040 sq m shop — the retailer’s largest brickand-mortar outlet in the Benelux.

The three-storey building is located on the Netherlands’ busiest shopping street, Kalverstraat, across from Hudson’s Bay, which has announced the departure of Saks Off Fifth Avenue from Amsterdam. Moreover, the future of Hudson’s Bay in the Netherlands remains in question.

Arket, H&M Group’s newest retail concept, also opened its first store in the Netherlands last year, located in Amsterdam.

Arket managing director, Lars Axelsson, said of the opening: “As a large European city, Amsterdam is important in the overall expansion of Arket. The strategy for Arket is to be where our customers are and Amsterdam is such a city.”

Meanwhile, Tommy Hilfiger reopened its Premium concept store on Amsterdam’s Hoofstraat. The premises has undergone a dramatic evolution as part of a two-phase delivery of the progression of the retailer’s Sportswear 16 concept. Under Armour has also opened its new EMEA headquarters in Amsterdam’s Olympic district. The new facility has the capacity to house more than 200 employees, as well as showrooms for retail partners.

The brand says the move reflects its commitment to continued growth in the region.

City centres across the Netherlands are reshaping to reflect the demand for different types of spaces. And the result is a more dynamic market, writes Annelies Keus

As Fabien Stutz, senior director real estate & store construction at Nike, says: “I believe physical retail is a great opportunity to bring the brand to life and offer an immersive experience to consumers. In today’s digital world with more people shopping online, you need to create more than just a place to buy products.

It’s about the physical experience, which you cannot replicate online. It’s about listening to your consumers and staying relevant by combining physical and digital retail and offering highly personalised experiences that advance the relationship you have with your consumer.”

Nike, on the other hand, is serving a global consumer base composed increasingly of digital natives. Stutz adds: “We want to make the shopping experience seamless, frictionless and

MAPIC PREVIEW • 53 • October 2019

personal for the consumer as they move between physical and digital. Creating fully immersive and connected experiences opens new ways for brands to present themselves and for consumers to explore a retail space.

You need to think beyond the physical walls of a store and deep dive into the world of your consumer and learn about their needs and expectations.

“Technology is already improving the engagement between retailers and consumers. Data-driven insights help to personalise the experience and new technology like Nike Fit, further enhances this.”

Hubert Stech, managing director of Multi Germany and Benelux, adds: “There will always be a demand for physical stores. To walk through a city and explore the local brands, and enjoy food

REGIONS: THE NETHERLANDS and drinks in between shopping is irreplaceable. However, mixeduse shopping destinations will become the future of retail.” .

known for pioneering new concepts, working with brands to innovate, and converging digital and physical in state-of-the-art surroundings. That is exactly what we are doing here.”

Hubert Stech, Multi:

“There will always be a demand for physical stores. However, mixed-use shopping destinations will become the future of retail” Retail development in the Netherlands has been comparatively quiet. However, Neptune, a joint venture between Neinver and Nuveen Real Estate, has acquired a plot at SugarCity in Halfweg for Amsterdam The Style Outlets, which is expected to open in the third quarter of 2020 with 115 stores set across 19,000 sq m. Overall, there is more redevelopment than new building in prime areas.

In the summer, Unibail-Rodamco-Westfield confirmed that it was rebranding its upcoming development in the Randstad area as Westfield Mall of the Netherlands, as part of a continent-wide

Bart van Twillert, Unibail-RodamcoWestfield:

Uniqlo debuted in Amsterdam in October last year

strategy to leverage the consumer-facing Westfield brand. Christophe Cuvillier, group CEO of Unibail-Rodamco-Westfield, says of the move: “As the only global brand in the industry, the introduction of Westfield will enhance the value and positioning of our destinations across continental Europe. Supported by global marketing campaigns, it will make the centres a venue for spectacular events, while delivering significant benefits to our visitors and providing an international platform for retailers to enter new markets.”

Opening next year, Westfield Mall of the Netherlands will feature 280 stores, restaurants and leisure outlets across 117,000 sq m. And like the other flagship centres in the portfolio, it will offer a range of events and experiences beyond traditional retail.

Bart van Twillert, Unib a i l - Ro d a m c o - We s t f i e l d ’s country manager for the Netherlands, adds: “It’s a transformative time for the Dutch retail landscape, with people craving more personal interactions and enriching experiences.

Unibail-Rodamco-Westfield is

Neptune’s The Style Outlets, expected to open in late 2020

MAPIC PREVIEW • 54 • October 2019

“It’s a transformative time for the Dutch retail landscape, with people craving more personal interactions and enriching experiences” Indeed, around 25% of the existing retail floor area in the Netherlands will be redundant by 2023, according to data from advisor CBRE. So how do spaces remain attractive to developers, retailers and investors?

The answer, according to Multi’s Stech, is that the traditional shopping centre is set to undergo a transformation: “Retailers no longer need large spaces for inventory. This will bring a lot of opportunity for diversity and mixed-use shopping centres in the near future. For example, we will soon start to see medical and healthcare centres, supermarkets, retailers and offices all under one roof. This will be a big change in the redevelopment and refurbishment of shopping destinations.”

As a result, concepts such as Foodhallen in Amsterdam, founded in 2014, are likely to become mainstream as consumer demand for experience in F&B continues to evolve.

The idea of creating a marketplace where people can combine business with leisure and enjoy different cultures through food will increasingly define the way we shop, agrees

REGIONS: THE NETHERLANDS Jeroen Lokerse, head of Netherlands at Cushman & Wakefield.

Places where people can eat and meet at the same time will mean destinations become “more than a product or service”, he adds.

“Establishment criteria will make the difference between the success and failure of organisations.”

A good example of this is Multi’s Forum Rotterdam, an innovative mixed-use regeneration

project in the city centre that is being completed in various phases throughout 2019. The site is located in the busy geographical and emotional heart of the city, and surrounded by areas dom-

inated by clusters of culture, transport, museums, creativity and innovation. Once complete, Forum Rotterdam will consist of 64,000 sq m of shops, F&B outlets, offices and apartments.

Meanwhile, Holland Metropole — an alliance between the cities of Amsterdam, Rotterdam, The Hague, Utrecht and Eindhoven and the top tier of the country’s real estate development and investment managers — is helping to create a multi-centred metropolis, with numerous projects aimed at changing the way consumers live, eat and play.

CONFERENCES & EVENTS AT MAPIC

SNAPSHOT BELGIUM Wednesday 13 November - 11.00-12.00 Verrière Grand Auditorium, Level 1 SNAPSHOT NETHERLANDS Wednesday 13 November - 14.45-15.30 Verrière Grand Auditorium, Level 1

Mixed use regeneration: Multi’s Netherlands Forum Rotterdam

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REGIONS: ITALY Aedes’ Caselle Open Mall: Open-air, urban-style architecture and a huge entertainment offer

If looks could thrill...

Italian retail is still looking good as ever, but the acceleration of e-commerce even in Southern Europe means that the future will be all about experience, writes Isobel Lee

T Talking Italy in Milan

HE ITALIANS, it is said, have a gift for looking good. While caring about appearance has long encouraged the country’s love of shopping, the persisting popularity of retail therapy is having far from superficial consequences for Italy in the property-investment stakes.

“Italy is still one of the strongest countries in Europe in terms of physical stores, with Milan and Rome remaining the most important shopping destinations,” says Francesca Cattagni, head of high-street leasing at Savills Italy.

“Although the click-and-collect model is emerging for fast fash-

ion, people still want that physical experience — and investors are taking note.”

Giuseppe Amitrano, CEO of Italian high-street retail specialists GVA Redilco, agrees: “Great weather, stunning historical towns and ancient monuments make the physical Italian shopping experience truly unique. Another key aspect is luxury shopping, which has still maintained a strong ‘in person’ appeal.”

Giuseppe Amitrano, GVA Redilco:

“Great weather, stunning historical towns and ancient monuments make the physical Italian shopping experience truly unique” A love of labels combined with the ubiquitous satisfaction of clinching a bargain has also helped keep outlet centres in

MAPIC PREVIEW • 57 • October 2019

vogue, according to Mario Pello, head of real estate Italy at Nuveen Real Estate. “Designer outlets have been one of the most widely misunderstood but strongest performing real estate sectors in Europe over the past decade,” he says. “This is particularly true in Italy, where some of Europe’s most notable outlets are located.” Nuveen recently sold its Barberino Designer Outlet in Tuscany, managed by McArthurGlen, to German fund DWS, underlining investor interest in the sector, according to Pello. “Despite some difficulties seen across the traditional retail sectors, outlet malls are proving to be resilient, ensuring their continued attractiveness to long-term investors looking for quality and diversification,” he adds.

However, property investors’ concerns about retail headwinds across Europe are necessarily driving change, even in Italy.

While Italian e-commerce pene-

REGIONS: ITALY tration currently stands at 4.1%, according to market research firm Forrester, it is predicted to climb steeply in the next two decades. Add in the millennial-driven focus on shopping for experiences over things and some bold new ideas are starting to emerge.

“We are working on the transformation of shopping centres into social hubs,” says Massimo Moretti, president of Italian shopping-centre association CNCC. “Italy’s well-renowned food culture has made us sector leaders in terms of F&B concepts while, in the leisure stakes, new experiences are being born all the time.”

According to Moretti, service is another emerging theme: “We are seeing more and more healthcare centres and dentists in shopping centres, and this trend will keep on growing.”

Italy’s major shopping-centre developers and operators are now leading by example. “Retail today is all about experience, which is what consumers are looking for, and providing it is the only way to drive footfall,” says Giuseppe Roveda, CEO

of Italian commercial REIT Aedes. “This means easily accessible locations, attractive architecture, ample and pleasant common spaces, and an offer that extends way beyond retail into leisure, entertainment and personal services.”

Aedes’ Caselle Open Mall attempts to tick all those boxes “with its innovative, open-air, urban-style architecture, a massive offer of entertainment opportunities and a vast array of F&B outlets, ranging from fast food and casual dining to fine dining and social drinking”, Roveda adds.

Retail mecca Scalo Milano Outlet & More — another Italian success story — has also been evolving to meet shoppers’ needs, according to company CEO Davide Lardera. Recent innovations have included Amazon Lockers and Prime Now collaborations, plus further F&B concepts. “Fifteen of our 150 units are dedicated to F&B,” Lardera says, noting that Scalo Milano was the first outlet centre to launch a dedicated food court. “Over the last 12 months, we have inau-

gurated a new shopping street with 22 stores to reach a surface area of 35,000 sq m,” he adds.

“We’re also driving Scalo Milano’s evolution into a real destination for tourists and entertainment-seekers, with concerts, cultural initiatives, exhibitions and social projects.”

Another Italian leader in shopping centres and hypermarkets, IGD, is also looking beyond traditional retail, according to management executive Daniele Cabuli: “We truly believe in omni-channel and think that our shopping centres should be places where people can meet and spend time together. They are Italy’s modern-day piazzas, requiring a much broader tenant mix.”

Daniele Cabuli, IGD:

“Shopping centres should be places where people can meet and spend time together.

They are Italy’s modernday piazzas”

Innovative leisure specialist Industrial Frigo is making its MAPIC debut this year

MAPIC PREVIEW • 58 • October 2019

IGD’s latest development project, fashioned from former naval offices along the Livorno waterfront, will also represent the vanguard in the evolution of leisure, Cabuli adds.

Similarly, Svicom has been involved in a number of new openings and expansions, while its leasing department has also focused on new services for leisure and co-working spaces.

This year Svicom has supported the launch of La Birreria in Naples, Maregrosso in Messina, Granroma in Rome and the upcoming opening of the Bari Santa Caterina retail park in Bari, due by the end of the year.

For La Birreria, Svicom is completing the leasing of the external area and buildings, completing the centre offering with the inclusion of services (clinic, gym) and more food points.

Svicom has also strengthened its presence in Rome by adding Happio to its portfolio, located in the heart of the city, while leasing is ongoing at Go! Torino, located in the city centre, a “beautiful and innovative” project due to open in 2021.

While Italy has perhaps gained an easy lead in Europe in the F&B stakes, leisure could be the country’s next big challenge — although exciting concepts are already emerging, such as the snow and ice wonderlands created by Industrial Frigo. According to the company’s owner, Roberto Penocchio, the Italian leisure specialist has already created ice-rinks and snow domes across Italy and has begun expanding into territories as diverse as the US, Brazil and Uzbekistan.

Making its debut at MAPIC this year, Industrial Frigo’s USP involves “creating environments at room temperature where the elements made of ice don’t melt, so that people can enjoy our entertainment facilities without having to dress for the

REGIONS: ITALY cold”, Penocchio says. Expanding rapidly into hotels, shopping centres and even creating stand-alone parks, the company is another example of Italian invention that looks set to go far.

“Leisure has to involve a strongly innovative element if a shopping centre is to stand out from the pack,” Penocchio adds.

Worldwide advances in Italian influence are aided on the home front by the Italian government and some key organisations.

The Italian Trade Agency (ICE), CNCC and Confimprese back Italian companies that are ready to expand, and help international investors to find the right opportunities in Italy, encouraging further foreign investment.

“We’ll be present at MAPIC once again to back both CNCC and Confimprese,” says Stefano Nigro, director of Italy’s

Scalo Milano Outlet & More, an Italian success story

foreign investment promotion office. “After a record 2017 for investment volumes in Italy, 2018 underlined the decisive role being played by overseas capital, which reached 65% of total investments — a trend

that is continuing this year.”

Nigro adds: “The Italian pavilion will include an investors’ arena to launch key projects to MAPIC’s professional audience and plenty of networking opportunities. With another

034_DOWNTOWN HOTEL_PV_PIC_page 2

MAPIC PREVIEW • 59 • October 2019

€1.25bn of public real estate up for grabs this year, there are going to be a wide range of unrepeatable prospects on show, from former barracks and convents to villas and palaces — all ready to be transformed into prestigious investment opportunities.”

“Our main objective for MAPIC will be supporting Italian retailers that are planning to open new sales points overseas,” adds Mario Resca, Confimprese’s president. “We’re currently following around 110 launches around the globe.”

CONFERENCES & EVENTS AT MAPIC SNAPSHOT ITALY (Part 1) Wednesday 13 November - 15.30-16.15 Verrière Grand Auditorium, Level 1 SNAPSHOT ITALY (Part 2) Thursday 14 November - 17.45-19.15 Main conference room, Level -1

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regions: SPAIN AND PORTUGAL

Fun in the sun

McArthurGlen’s Designer Outlet Malaga

Spain’s latest retail-led developments feel more like luxury resorts than shopping centres, while Portugal is regenerating for tourists and Gen Z consumers. Sarah Morris reports

I

N A WORLD where retail development is driven by far more than shopping, the Iberian Peninsula has one major advantage: an all-year-round supply of leisure-seeking tourists. With visitor numbers rising in both Spain and Portugal for much of the last decade, developers and retail managers have targeted tourists from across the globe with resort concepts that are strong on leisure and F&B. It’s a mix that also works for sociable Spaniards and Portuguese, with both nations enjoying falling unemployment and economic growth higher than the EU average.

In Spain, which hit another record tourism year in 2018 at 82 million visitors, 18 new shopping centres totalling 780,787 sq m GLA and 1.1 million sq m of extensions are to open by 2021, according to the Spanish Association of Shopping Centres and Business Parks (AECC).

These include projects on the coast and near popular cities.

“The sector is immersed in a period of transformation that is generating opportunities for everyone willing to accept that the formulas used years ago are no longer enough,” says recently appointed AECC chairman Eduardo Ceballos, who is also

country head of Spain and Italy for outlet specialist Neinver.

“Shopping centres are strengthening their position as meeting points, where retail co-exists with a varied offer of ever-more diverse, innovative and healthy restaurants, as well as sports and leisure activities, and cultural events like concerts and even water parks.”

McArthurGlen, Europe’s largest designer outlet operator, is stepping into Spain — its 10th country — through a joint venture signed with Sonae Sierra.

Designer Outlet Malaga will benefit from the well-established footfall at Sonae Sierra’s

MAPIC PREVIEW • 61 • October 2019

AECC’s Eduardo Ceballos

adjacent Plaza Mayor Shopping Centre, which attracts 10 million shoppers a year. It will target tourists through its sales teams in 15 long-haul markets, as well as a tourist manager working with agents on the Costa del

regions: SPAIN AND PORTUGAL Sol to ensure the centre is on visitors’ itineraries. “And we have teams in our source markets helping us source tourists before they leave their home,” adds Joan Jove, McArthurGlen’s managing director for southern Europe.

Phase one, due to open this autumn, consists of 17,500 sq m of retail space and 100 designer brands. Moreover, McArthurGlen is in the planning stage to add extra retail space to the centre to bring it up to 30,000 sq m.

In terms of design, Italian and local architects have incorporated an Andalusian style within an open-village concept. A central luxury plaza will feature dancing fountains and a children’s playground. “We always use the local architectural language,” Jove says. “We don’t want to impose a foreign language on a centre.”

Not surprisingly given the warm climate in Spain, water is a major attraction at new centres. Lar Espana — the first Spanish REIT to list on the Spanish stock exchange last year — has put a 6,000 sq m lake centre stage at Lag-

oh, a 123,500 sq m shopping and leisure destination to the south of Seville, which expects to receive 14 million visitors a year after its opening in September.

French developer Compagnie de Phalsbourg, meanwhile, has a 10,000 sq m lake, a private club with an artificial beach, a jacuzzi and a swimming pool at its first Spanish centre, Open Sky Torrejon, 20 km east of Madrid, which is due to open next April. It will offer 21,500 sq m of retail space and plentiful leisure facilities, including 32 bars and restaurants, a stage for concerts, theatre productions and opera, and a wind tunnel.

The term ‘shopping centre’ doesn’t begin to capture the experience on offer, observes Raphael Martin, chairman of the French group’s Spanish subsidiary. “We’re going to invent a new term,” he adds. “Every Saturday, people are going to say, ‘Let’s go to Open Sky…’ — because every Saturday there will be something on.”

Lar Espana’s Lagoh development south of Seville

Raphael Martin, Compagnie de Phalsbourg:

“We’re going to invent a new term for shopping centre” Leisure will also underpin intu Costa del Sol, a large mixeduse scheme planned for 2023 at Torremolinos, on Spain’s southern coast. UK-based developer intu and Madrid-based Eurofund Group believe the centre will become a new tourist attraction, pulling in an estimated 29 million visitors a year. With

142,00 sq m of retail units, intu Costa del Sol will include eight distinctive neighbourhoods, a year-round circus, an urban farm, two hotels, more than 70 restaurants, a conference centre and a 5,000-person concert venue.

In Portugal, the shopping-centre market is expanding and existing centres are being renovated to create hubs for family and friends. “It’s not like 20 years ago, when people just went shopping, had a sandwich and went home,” says Cristina Cristovao, retail agency director at Savills. She adds that centres and their brands are targeting Gen-Z, which is driven by leisure and social networks, and cites a friend who waited hours with her daughter at the Centro Colombo in Lisbon because a Portuguese YouTuber was making an appearance.

“Everywhere these YouTubers go, young people go and the shopping centres are very aware of these tendencies,” Cristovao says.

Cristina Cristovao, Savills: “It’s not like

Open Sky Torrejon, east of Madrid, is due to open next April

MAPIC PREVIEW • 62 • October 2019

20 years ago, when people just went shopping, had a sandwich and went home”

regions: SPAIN AND PORTUGAL Sonae Sierra is spending €151m adding an extra 10,500 sq m and a 33,000 sq m office building to Colombo. It is also spending €77m on an extra 14,000 sq m at NorteShopping in Porto, which is due to open next year.

In August, Iberia Coop — a fund owned 10% by Sonae Sierra and 90% by international investors — brokered an agreement for the sale of AlgarveShopping and Albufeira Retail Park to French developer Frey. Under the deal, Sonae Sierra will continue to be responsible for the property management and leasing.

Fernando Guedes de Oliveira, CEO of Sonae Sierra, describes the transaction as “another important milestone” in the implementation of the retail real estate company’s strategy.

Elsewhere in Portugal, CBRE is managing and leasing the UBBO shopping centre for Eurofund Group and AXA Investment Managers – Real Assets, transforming the former

Sonae Sierra is investing in an extension to NorteShopping, Porto

Dolce Vita Tejo in Amadora with a plan that includes private health-care group Trofa Saude.

The latter will invest €50m in creating what will be its second hospital in Lisbon, complete with 160 beds, consultation rooms, operating theatres, a

maternity ward, and a 24-hour accident and emergency service.

The revamped centre will also have new gardens, rest areas, terraces and cafes, as well as a plaza with a trampoline park, climbing walls, mini golf, a traditional merry-go-round and

The Hood, an urban space that Eurofund Group says will take “an original approach to shopping through entertainment and art”. “It will be the first resort shopping centre in Portugal,” adds Carlos Recio, director of retail advisory and transaction services at CBRE. Portugal’s high streets are also undergoing a revolution due to the abolition of a protected rental law and the arrival of international food and fashion brands looking to cash in on tourism, boosted by the growing number of cruise liners docking in ports such as Lisbon.

“Tourism continues to be the driving force behind street shopping in prime areas, but the new lifestyle of the Portuguese is also pushing the locals further and further on to the street,” adds Patricia Araujo, head of retail in Portugal for advisor JLL.

CONFERENCES & EVENTS AT MAPIC Appealing to locals and the region’s huge tourist industry, intu Costa Del Sol will open in 2023

MAPIC PREVIEW • 63 • October 2019

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REGIONS: THE NORDICS

Citycon is redeveloping and extending Lippulaiva, Helsinki

Northerly winds of change As a region, the Nordic territories — Sweden, Norway, Denmark and Finland — are as subject to shifting retail patterns as anywhere else. But this doesn’t mean physical retail is in terminal decline, writes John Ryan

I

N EUROPEAN terms, the Nordic region is frequently regarded as a thing apart, a place with its own rules, sense of style and, when it comes to business, way of doing things. This is Europe’s far north and geography plays as big a part in what happens here as anything else. With the exception of Denmark, these are large countries — in European

terms — with small populations, making them both wealthy but with their own challenges. Practically, this means that communications operate differently in certain parts of the region.

Oliver Fraser-Looen, joint head of regional investment advisory EMEA and head of retail investment EMEA at Savills, notes that “the Nordics have some of the world’s worst road

infrastructure”. He adds: “If you want to get from Oslo to Trondheim by road, you just can’t do it.”

All of which means that, despite IKEA and H&M being global retail giants, there is a distinct feeling of ‘Nordicness’ about the region. Many foreign retailers have looked at the territory and considered it a market with too many problems — not least the price of entry. There is also the matter of population size and the number of shops. Of the group, only Finland fails to make the top 10 in terms of European retail meterage per head, meaning that these are countries that are generally over-shopped.

Rural depopulation has also had a part of play in the Nordic retail landscape, with large num-

MAPIC PREVIEW • 65 • October 2019

bers of people heading for the relatively few big cities. FraserLooen says that it has been boom time — “We’ve had seven years of high-street retailing being phenomenal…” — but adds that things have now plateaued or are on a downward path.

Oliver Fraser-Looen, Savills:

“We’ve had seven years of high-street retailing being phenomenal” It is a view echoed by Pal Martin Fosdal, head of retail services, Norway, at Cushman & Wakefield Realkapital. “We’ve had a good time and there is still growth, but it is not as good as it was,” he says.

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REGIONS: THE NORDICS Pal Martin Fosdal, Cushman & Wakefield:

“We’ve had a good time and there is still growth, but it is not as good as it was” Change has been apparent.

Fraser-Looen points to the fact that the Nordics have embraced luxury, with both Stockholm and Copenhagen developing luxury quarters and a similar area take shape in Oslo. In this respect, the region remains relatively underdeveloped when set against other areas of Western Europe.

Yet the obvious question, given the fact that the region’s four main economies are still buoyant, is what is taking the place of high-street retail for landlords and developers? Allowing for the number of shopping developments already in place, refurbishment and extension are the order of the day, rather than spanking new schemes.

Practically, this means that schemes such as Hede Fashion Outlet outside Gothenburg and the Oslo Fashion Outlet have had money pumped into them in order to boost their pulling power. In the case of VIA Outlets’

Work is nearly complete on Hede Fashion Outlet, Gothenburg

Hede, where work is just coming to an end, an additional 2,700 sq m has been added to the centre, bringing the total number of stores to 75 and the GLA up to 19,000 sq m. This may not sound huge, but it is symptomatic of the direction being taken.

Equally telling is the shift towards mixed use rather than pure retail. This trend is exemplified by Oslo’s Bispevika scheme, where OSU has taken a phased approach to the development of a large area on the Norwegian capital’s waterfront. In addition to high-rise apartments and offices, retail is a key part of Bispevika’s

At Oslo’s Bispevika scheme, OSU has taken a phased approach

mix — a reflection of the place being afforded to retail in the Scandinavian scheme of things.

It is also fair to say that edge-oftown shopping malls are, to an extent, being somewhat left out in the cold, as consumers in the big cities return to shopping the urban centres. Again, Bispevika demonstrates this trend in action.

Finland’s Citycon has embarked on the redevelopment and extension of Lippulaiva, located in the rapidly growing and affluent neighbourhood of Espoonlahti in the Helsinki Metropolitan Area. A completely new, modern and urban shopping centre, more than double the size of the old centre (from 19,200 sq m to 44,300 sq m), will be built in order to accommodate a new metro station and bus terminal.

Expected to complete in 2022, the revamped Lippulaiva will host around 80 shops, cafes, restaurants and services, in addition to municipal and health-care facilities, and a kindergarten. Lippulaiva will also house the world’s largest geothermal plant in a shopping centre, which will make it almost completely self-sufficient in terms of the energy required for heating and cooling. Not surprisingly, it has a certification target of BREEAM Excellent.

MAPIC PREVIEW • 67 • October 2019

As elsewhere, ecommerce is on an upward path and growing quickly. The Swedes show the greatest propensity for this, but etailing is performing well across the entire region. However, there’s a caveat for etailers eyeing up the Nordics: regional operator DIBS Payment Services notes in a recent report that Nordic consumers shop online in order to save money and baulk at delivery charges, meaning that the bar is set high as far as making a profit is concerned.

In general, the Nordic region is experiencing the slowdown that has been apparent across the rest of the European continent.

But although change is taking place, urban shoppers, mixeduse development and refurbishment are all contributing to a regional retail landscape that remains vibrant even in the face of considerable challenges.

It should also not be forgotten that, with H&M and IKEA, Sweden is home to two retail giants — a feat that many countries with much larger populations have not managed to achieve.

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REGIONS: RUSSIA AND CEE

New formats, new faces

I

N RUSSIA, the consolidation of the traditional retail players and the increasing dominance of omni-channel is resulting in both a market shift and structural change.

Among the spate of consolidations was the 2018 acquisition

by Russian consumer electronics chain M.Video of its two main competitors, Eldorado and MediaMarkt. Last year also saw the merger of the country’s two largest mobile-phone retailers, Euroset and Svyaznoy. And in 2019, two of Russia’s top 10 FMCG retailers — Dixy and Krasnoe & Beloe — have combined forces.

This period of market consolidation follows somewhat moderate growth in Russia’s retail sector, with retail sales expected to grow by 1.7% this year, according to Anna Nikandrova, a partner at Colliers International Russia. This, she adds, is on the back of both real disposable-income stagnation and

the increase in competition among quality shopping centres. Around 1 million sq m of new shopping-centre space is expected to be opened by the end of this year. “This has led to developers shifting from classic shopping-centre construction to mixed-use concepts that offer customers the chance to shop, be entertained and solve other everyday tasks in a more convenient way, close to transport hubs, offices and other points of interest,” Nikandrova says.

Anna Nikandrova, Colliers International:

“Developers are shifting to mixed-use concepts that offer customers the chance to shop, be entertained and solve other everyday tasks in a more convenient way”

The Spektrum centre in Prague

Russia’s retail market has been reshaped in the last year by a wave of consolidation and an influx of new players. The story is the same in the CEE, especially in the core markets of Poland and the Czech Republic. Liz Morrell reports

The move from classic shopping centres to new and more specialised formats is particularly obvious in Moscow, where 65% of new delivery in 2019 is expected to be mixed use and specialised. Prominent among these is the Ostrov Mechty, or Dream Island, amusement park, whose 190,000 sq m GLA will account for more than a third of the new space in the Russia capital, Nikandrova says.

Ostrov Mechty is based around an indoor-theme park design and will be the largest such concept in Europe when it opens later this year. This is complemented by retail, a food court, a cinema, a hotel and a concert hall, as well as residential. Construction of the park completed

MAPIC PREVIEW • 69 • October 2019

in May, with finishing work and the installation of attractions expected to be finished this autumn.

Among the new faces to have entered the Russian market in the last year is US children’s fashion brand OshKosh B’gosh, which opened in Moscow’s MEGA Teply Stan mall with a 156 sq m store. OshKosh B’gosh’s new Russian flagship joins MEGA Teply Stan’s ‘kids’ cluster’ — an area specially designed for families and children, which is currently being extended from 5,428 sq m to almost 14,000 sq m. Among the kid-friendly features on offer are play areas, special-interest clubs and activities, restaurants featuring children’s menus, and edutainment

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REGIONS: RUSSIA AND CEE offerings designed to help kids to learn and make friends. There is also the first children’s hypermarket, which includes special play areas and is operated by Russian children’s goods retailer Detsky Mir. Other international brands in MEGA Teply Stan’s kids’ cluster include Mothercare, CityKids, Lego and Gap Kids.

“MEGA Teply Stan is being transformed into a vibrant ‘meeting place’ for recreation, leisure, entertainment and dining that will attract high levels of footfall long into the future,” says Vasco Santos, global sales and leasing manager at Ingka Centres (formerly IKEA Centres), which manages Russia’s MEGA-branded shopping centres.

Emporio Armani’s EA7 brand has also entered Russia via the same mall. It is located in a 200 sq m store within a 3,000 sq m multi-branded department store that houses brands including Karl Lagerfeld, Marc Cain and Liu Jo. Last year, Ingka Centres announced a new strategic vision, part of which will see it take its retail-led mixed-use ‘meeting place’ concepts to the heart of cities for the first time. It plans to invest €3bn in centres in 30 major cities across Russia, Eu-

OshKosh B’gosh’s new Russian flagship joins MEGA Teply Stan’s ‘kids’ cluster’

rope, North America, Asia and Oceania.

Another new concept, Angara, opened in September — the first of ADG Group’s redevelopment of 39 Russian cinemas into ‘neighbourhood centres’.

The early results of the scheme will be revealed at MAPIC. Grigoriy Pecherskiy, managing partner of ADG Group, says the concept will help meet consumers’ changing demands.

“Russian consumers are tired of the usual retail offerings and are becoming more interested in buying products that fit them personally and underline their individuality,” he says. “They

Emporio Armani’s EA7 brand has entered Russia

prefer smaller, unique places where, for example, they can chat with a familiar barista while waiting for their coffee to be made with organic milk from a family farm with a good reputation.”

Grigoriy Pecherskiy, ADG Group:

“Russian consumers prefer smaller places where, for example, they can chat with a barista while waiting for their coffee to be made with organic milk from a family farm” F&B continues to be a strong — and developing — category in Russia, with the eating-out industry growing more than 1.5 times faster than retail sales in 2017 and 2018. F&B is continuing on a fast growth trajectory in 2019, according to Colliers’ Nikandrova.

Against this backdrop, the majority of the ADG centres will include food halls that combine different national cuisines and support small local businesses.

“Our understanding of

MAPIC PREVIEW • 71 • October 2019

where the market is heading allows us to choose the best projects for our Angara neighbourhood centres to offer Muscovites the best concepts in food, integrated omni-channel sales and entertainment to suit any taste,” Pecherskiy says. “But most importantly, we are going beyond retail trends and looking at what is happening in society as a whole. People are starting to value neighbourly relations more and want to feel part of a local community. Our project caters to this broad public demand. We are creating local focal points and making sure that they offer the functions that will be most popular in each specific district and micro-society.”

As Pecherskiy notes, there is a strong shift to omni-channel and the best developers are embracing this trend. As a result, an increasing number of lockers and pick-up points are emerging across Russia — and Nikandrova believes many more will follow.

“The market will move to omni-channel becoming a necessity for all major retailers,” she predicts. “Online delivery, in-store click-and-collect services and self-service kiosks have already been introduced by many top retailers and the market is grow-

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REGIONS: RUSSIA AND CEE ing. The Russian internet giants Yandex and Ozon are developing their own 24/7 locker chains and other retailers use either their own or partner services to deliver goods where the customers want them.”

A number of significant trends are also evident across the CEE region, according to Marta Machus-Burek, senior partner and director of retail advisory services at Colliers International Poland. These largely reflect the trends seen in Russia, including increasing investment in mixeduse concepts and post-industrial space, and the revitalisation of cities. Entertainment and leisure and omni-channel are also strong trends across the CEE. Machus-Burek notes that shopping centres are polarising.

Prime malls, if well managed, are performing better than ever, she reports, but middle-sized centres are struggling to find their place in the market. Meanwhile, smaller retail centres are also doing well, especially those in close proximity to residential districts. “These are developing into strong community centres by adding functions such as

Colliers’ Marta Machus-Burek

ADG’s Angara neighbourhood centres designed to offer the best in food, omni-channel and entertainment

medical centres and educational facilities to their retail offer,” she says.

But it is Poland, once again, that is leading the way in the region.

According to advisor JLL, the first half of the year saw the Polish market grow by 215,000 sq m of modern retail space. It is estimated that around 278,000 sq m of space across all retail formats will be delivered to the market in the second half of the year, although the completion of some developments may be put back until 2020. At the

beginning of July, the overall retail investment volume transacted in Poland stood at around €730m.

“Poland is an attractive location for newcomers,” says Marta Mikolajczyk-Pyrc, head of retail property management in the property and asset management department at Savills Poland. “In 2018, almost 30 new international brands entered the market and the vacancy rate in projects located in cities of above 150,000 people remains low, at circa 3%-4%.”

Atrium’s portfolio includes five shopping centres in Warsaw.

MAPIC PREVIEW • 73 • October 2019

Marta Mikolajczyk-Pyrc, Savills:

“Poland is an attractive location for newcomers.

In 2018, almost 30 new international brands entered the market” However, market saturation is leading to a slowdown in development activity, while a Sunday trade ban is changing how retailers operate. “Interest in retail facilities in Poland on the part

REGIONS: RUSSIA AND CEE of investors has slightly decelerated, similar to many other European countries,” Mikolajczyk-Pyrc says. “Although 2018 was a record-breaking year for the investment market in Poland, both as a whole and from the perspective of the commercial sector, the share of commercial properties in the total transaction volume dropped to 34%, more than half of which was constituted by two portfolio transactions.”

Reconstruction and modernisations are rife in the current market. Mikolajczyk-Pyrc believes that this trend, thanks to the aforementioned market saturation, will gather pace and there will be fewer new facilities as a result.

“Online sales and the Sunday trading ban is resulting in changing retailer strategies and store formats, new concepts and landlords increasing food offers to diversify and become more competitive,” adds Liad Barzilai, CEO of Atrium European Real Estate Management, which is increasing its focus on large, high-quality retail centres in prime urban locations and capital cities. Around 84% of

Primark will open its first Polish store in the in Galeria Mlociny in Warsaw’s Bielany district

Atrium’s portfolio is now in Poland and the Czech Republic. In Warsaw, it owns five shopping centres, including Wars Sawa Junior, which it acquired last October, and Atrium Promenade.

Barzilai says the higher expectations of a new generation of CEE shoppers is driving demand for a new type of shopping destination. “We see increasing demand for quality

spaces with interesting architecture, constantly changing fashion offers and more food diversity,” he adds. “We can say it’s more a social phenomenon: the creation of local communities, where food halls and food spaces are becoming the places to spend quality time with friends — or to meet future friends.”

Atrium is also focused on refurbishment and extensions to bring new life to existing cen-

tres. “This gives us the opportunity to implement new retailer concepts, gives a home to online retailers looking for a brick-andmortar presence and offers new food socialising spaces,” Barzilai says. It also gives centres the flexibility to host pop-up offers and work with “young, Instagram-born brands”, he adds.

As a result of these changing market dynamics, Atrium is redefining its role, moving from asset management to venue management. “We no longer manage shopping centres,” Barzilai says. “Instead, they are experiential assets that present well on social media — places that are Instagramable.”

Liad Barzila, Atrium Real Estate:

Panattoni Europe’s Amazon facility is part of a hot logistics market in the CEE

MAPIC PREVIEW • 74 • October 2019

“We no longer manage shopping centres. Instead, they are experiential assets that present well on social media — places that are Instagramable”

REGIONS: RUSSIA AND CEE Poland’s strong retail performance led Primark to confirm in July that it will open its first store in the country — a 3,600 sq m outlet over two floors in Galeria Mlociny in Warsaw’s Bielany district. The retail and leisure complex opened this May, with more than 240 stores alongside 5,000 sq m of office space and 6,000-plus sq m of restaurant and entertainment options. Galeria Mlociny is 70% owned by EPP, which manages it, and 30% by Echo Investment.

Tom Meager, group director of property for Primark, says the Irish fast-fashion retailer had been looking for a suitable location for its first store in Poland.

“We’re delighted to be opening in Warsaw’s newest shopping centre,” he adds.

Marcin Materny, Echo Investment board member responsible for retail, describes Primark’s debut as sending a “strong message to the whole world that the Polish retail market still has enormous potential to accept new brands”. Poland’s other advantages include a firstclass retail infrastructure, a strategic geographical location and high footfall,” he adds.

Primark’s new Warsaw store follows the opening in June of its first CEE store in Ljubljana, Slovenia. In addition, the company has announced plans to open in Czech Republic, which

Prague will welcome a new Time Out Market in 2021

will also welcome a Time Out Market in 2021.

Meanwhile, CPI Property Group, the biggest owner of the retail space in the Czech Republic, reported a “record-breaking” start to 2019, marked by both project launches and the continuation of ambitious reconstruction schemes aimed at reviving premises and making the shopping experience more enjoyable for customers.

“Investments in our shopping centres will once again be in the hundreds of millions of Czech crowns this year,” says Petr Brabec, CPI’s head of asset management, shopping centres.

“The Spektrum centre in Prague is a very special case as it’s being pulled down to be replaced with a new, modern design [by architect Chapman Taylor].”

RUSSIAN BREAKFAST AT MAPIC THE RUSSIAN Breakfast, organised by Impress Media, will be held on November 14 at the Salon Diane in the Majestic hotel in Cannes. The Russian Breakfast at MAPIC is a traditional professional event for networking

for over 250 leaders in the Russian retail real estate market. This year the format of the event is a business dialogue to assess the current potential of the market and to search for new development strategies.

Robert Dobrzycki, Panattoni Europe:

“Over the past 12 months, many investors have begun to perceive logistics as the best asset class going forward” Poland also leads the CEE in another trend that is gathering in strength across the region — warehouse stock. In the first quarter of 2019, industrial and logistics space had already exceeded 16 million sq m, driven largely by the growth of the ecommerce sector. It is a development that is leading to a shift in investment focus.

“Two to three years ago, we all knew ecommerce would have a big effect on logistics, but it has been even more of a driving force and a dominant theme than we expected,” says Robert Dobrzycki, CEO of Panattoni Europe. “Traditional retail is losing out in a big way.

No-one anticipated the trend would come on so quickly and with so much force. Over the past 12 months, many investors have begun to perceive logistics as the best asset class going forward and have started to acquire properties in the sector to hedge against the weaker performance of the retail assets they hold.”

MAPIC PREVIEW • 75 • October 2019

Dobrzycki says Panattoni is being asked to find sites for big distribution centres located close to large labour pools, as well as smaller last-mile facilities situated closer to the consumer. “Ecommerce’s growing share of the market is a very positive trend for the sector because it uses three times as much distribution space as regular retail,” he adds.

“It accounts for around 30% of our business today, compared with less than 5% five years ago.”

Colliers’ Machus-Burek suggests the trend could result in a new use for struggling retail centres: “Shipping and logistics centres may be the new hot tenant or developer for vacant centres, because they can take advantage of these large vacant sites once they appear on the market.”

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REGIONS: TURKEY AND MENA

In search of the perfect blend The global shift towards the greater use of leisure and F&B spaces in shopping centres is shaping — and being shaped by — a new wave of developments across Turkey, the Middle East and North Africa. Ben Cooper reports

D

Avi Alkas, chairman of JLL Turkey

OMINATED by a grand 25-metre-high crystal dome and with no less than 1.2 million sq ft (111,400 sq m) of leasable space, the Nakheel Mall in Palm Jumeirah, Dubai, is set to be one of the high points of UAE retail-property development of the past decade. Due to open by the end of the year, the centrepiece of developer Nakheel’s project marks a new phase in mall design in the UAE, not least because, as part of a wider drive by the Dubai government to boost tourism to the Emirate, some of the mall’s most magnetic features — a public viewing deck looking out across the Arabian Gulf and Palm Jumeirah, and a rooftop dining deck — are

not even retail.

This change of focus from pure-play retail to centres that include leisure and dining is reflected in a wave of new developments across the Middle East and North Africa. From Ankara to Abu Dhabi, innovative new concepts in leisure, sports, culture, food, entertainment and wellness are being introduced alongside retail to create the sort of modern spaces and experiences that visitors are calling for.

It is what Timothy Earnest, chief executive of Al-Futtaim Malls, describes as the “fourth pillar” that all malls now need to transform themselves into attractive centres that provide “the special moments or unique experiences for visitors”. He

MAPIC PREVIEW • 77 • October 2019

adds: “With social media and selfies trending, having Instagramable spots is essential for a mall. It needn’t be a static onetime event, but something that happens though the year. As a mall-owner, our role is to help deliver those moments that people want to share or be a part of. This complements the ‘traditional’ mall elements of F&B, entertainment and retail.”

Timothy Earnest, Al-Futtaim:

“As a mall-owner, our role is to help deliver those moments that people want to share or be a part of”

REGIONS: TURKEY AND MENA To this end, Al-Futtaim has been actively working to enhance the entertainment value of its Doha Festival City mall in Qatar with a series of investments and innovations. As of last year, for example, the mall has been the home of the world’s first Angry Birds World entertainment park.

This year saw the extension of Doha Festival City’s outdoor park and leisure offering, which now measures 17,000 sq m and boast 20 rides and attractions.

In the UAE, Al-Futtaim is also busy putting the finishing touches to a mixed-use retail and leisure ‘local lifestyle destination’ called Festival Plaza. Set to open in December, the new centre will bring with it a 30,000 sq m IKEA store — the second largest in Dubai — along with a host of retail and leisure brands, 40 dining units and a 500-seat food court.

Festival Plaza is part of a new wave of developments in the Gulf and beyond that is seeing developers “pushing the boundaries for customer experience, digital, events and entertainment”, Earnest says.

The evidence for this can be found throughout the MENA

Meydan One Mall: Half of the space in the new centre will be dedicated to pop-ups

region. In Turkey — which is once again hosting a pavilion at MAPIC — Avi Alkas, chairman of JLL Turkey, says a post-development-boom phase of refining and enhancing malls with “frequency magnet” features is under way. “Consumers are increasingly viewing shopping as an experience and we need to accommodate this by creating engaging spaces with activities that are hard to experience at home,” he adds. “Landlords understand the growing importance of leisure, F&B, entertainment and events. Nowadays, we call them ‘frequency magnets’.

They attract the audience and ensure footfall frequency at shopping centres.”

Avi Alkas, JLL:

“Nowadays, we call leisure, F&B, entertainment and events ‘frequency magnets’. They attract the audience and ensure footfall frequency at shopping centres”

Doha Festival City has been extended this year

MAPIC PREVIEW • 78 • October 2019

The drive to create the sort of blended, experiential centres that Earnest and Alkas describe is good news for consumers, who now want more from their malls than shopping. But it is also a plus for the retail brands that occupy the malls.

Istanbul Apparel Exporters Association (IHKIB) will be at MAPIC for the third time, with the help of the Ministry of Trade of Turkey. IHKIB has over 10,000 active members managing an export volume of $17bn annually and at MAPIC it is supporting nine Turkish fashion brands at the Turkish Pavilion, helping companies that want to grow abroad, discover new locations with existing or new franchise partners, find new investment opportunities and expand their overseas store networks. This year Kigli, Avva, Damat, BG Store, Hemington, Penti, Yargici, Ipekyol and Perspective are participating.

Taylan Kirali, head of international retail at Turkish clothing brand Avva, says: “Shopping centres are now developing into wellness centres. The key point here is that they are becoming areas where people can go about doing their daily activities within close proximity. In addition, the increase in unique and

REGIONS: TURKEY AND MENA interactive spaces within the compounds is making shopping centres more attractive.

Kirali adds: “The Middle East is a rapidly growing market where we see a new project almost every month. We are excited to follow all these new projects, especially in Iraq and the Gulf countries.”

The UAE, however, is not in as rapid a growth phase as it once was. Both Abu Dhabi and Dubai are facing challenges in the form of consumer habits moving towards value shopping and online, driving landlords and developers to think more about new ways to increase visits, footfall and dwell time.

And there are other subtle changes, according to Dana Salbak, research associate for MENA at JLL. “As the retail market evolves, we’re seeing a shift away from the franchise model to more joint ventures and home-grown concepts,” she says.” These offer unique and more tailored experiences to customers, who appreciate a more personal experience of retail. Could retailers become leading tech players? Increasingly, technology is collecting and feeding retail data on customers to retailers, enabling them to nurture a more personalised experience for customers.”

Dana Salbak, JLL:

“As the retail market evolves, we’re seeing a shift away from the franchise model to more joint ventures and home-grown concepts” But there is still plenty of bricks-and-mortar activity in the UAE. By the end of 2021 a further 1.6 million sq m of retail space is expected to be delivered, according to JLL, with 600,000 sq m of this due by the

Arabian Centres is adding to its 21-centre portfolio across Saudi Arabia

end of this year. Much of this is accounted for by the major projects that are already under way, which include, in Dubai, Meydan One Mall and the Dubai Hills Mall.

By the end of 2020, Abu Dhabi, meanwhile, will have gained another 3 million sq m of retail-led space, the headlines there being The Galleria on Al Maryah island, which opened in September, and Reem Mall, which is set to open its doors next year.

Delivering 2.8 million sq ft of retail (2m sq ft of leasable space), Reem Mall will comprise around 450 stores, including 85 F&B outlets and a range of family-focused entertainment offerings. Positioned on Reem Island – in the heart of new Abu Dhabi – the mall will offer easy access along with parking for 6,800 vehicles. Construction began in late 2017 and is slated for opening late 2020.

“Both here in Saudi Arabia and across the wider MENA region, there has been a growing transformation in how experience is delivered. Increasingly we are seeing new formats such as open-air plazas or strip mall concepts creating increased competition for traditional malls,” says Arabian Centres CEO Olivier Nougarou. “As the leading lifestyle destination operator in the Kingdom in 21

locations Arabian Centres is successfully making this transition a reality through new concepts such as our open-air plaza UWalk, which will be launched in Riyadh soon.”

The company is also redeveloping existing destinations through new design features, a broader range of entertainment, new retail concepts and an increasing focus on F&B. “At Arabian Centres we are developing many new casual dining concepts and this year will open four cinemas in Jeddah, Riyadh and Dammam and will open in the bulk of our destinations by the end of 2020,” adds Nougarou.

In North Africa, Egypt still accounts for the most malls — 106 out of a total of 579 across the whole continent, according to the first Sagaci Research report into Africa, published last year. Egypt also has a healthy pipeline of more than 30 projects in various stages of development.

But there are major developments take place the length of the North African coastline — not least in Morocco, where the long-term Rawaj Vision 2020 programme, which aims to stimulate, among other things, the retail property sector, is nearing completion. If all the current projects proceed as planned,

MAPIC PREVIEW • 79 • October 2019

Morocco will have gained some significant new mall space by the end of this year in the form of Marina Shopping at Marina Casablanca, which opened in April, and an extension of the Marjane Californie.

Then there is the latest project from Groupe Aksal — the developer of the largest centre in Africa, the Morocco Mall in Casablanca — which is developing a major mixed-use retail-led project in the capital Rabat. In July, the company, which is also a franchise partner to a number of brands, opened the Amazzin multi-brand store, also in Rabat. Positioned around accessible premium brands, including Armani Exchange, Emporio Armani, Just Cavalli, La Martina and Polo Ralph Lauren, the new 200 sq m space is located on rue du 16 Novembre in the Agdal district, which has a large concentration of fashion boutiques.

Technology, changing consumer habits and the increasing influence of ecommerce have shaped, and are continuing to shape, the retail property paradigm in MENA’s diverse territories. The current phase of developments, redevelopments and extensions under way in the region will be the first in the new era of lifestyle-focused, experience-led centres that both shoppers and retailers want to see.

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REGIONS: NORTH AMERICA American Dream, East Rutherford, New Jersey

S

O MUCH empty space, so much opportunity.

The retail woes in the US — and, to a lesser extent, Canada — are creating an opportunity for suburban and urban property owners and leasing professionals to explore non-traditional uses to fill empty anchors and large boxes.

But caution must still be exercised, as any use, be it food and beverage (F&B), entertainment, health and wellness facilities or co-working spaces, must be assessed with how it integrates with its surrounding community.

“The traditional shopping centre is evolving,” says Derek Coss, senior vice-president and chief development officer at Ivanhoe Cambridge. “It’s now a dynamic cultural hub.”

Derek Coss, Ivanhoe Cambridge:

“The traditional shopping centre is evolving. It’s now a dynamic cultural hub” Times remain challenging. Store closures in the US could reach 12,000 by the end of 2019, according to New York Citybased think tank Coresight Re-

Anchors away as US dreams big A host of new users and blended activities are filling the empty spaces left by the decline in traditional retail across the US and Canada, allowing retail centres and communities to evolve into different destinations for new generations.

Debra Hazel reports search, compared with 5,864 closures in 2018. These include the shuttering of a number of Bed, Bath & Beyond, Pier 1, Sears and JCPenney stores, and the total shutdown of Payless, Henri Bendel, Dressbarn, Charlotte Russe and Charming Charlie, among others. By contrast, by early August, 3,118 store openings had been announced.

Even with companies such as discounters Dollar General and Dollar Tree, athleisure giant Lululemon and specialists such as Ulta Beauty, Sephora and Warby Parker continuing to expand, while Nike has opened some notable new formats, retail owners and managers are looking for alternatives to fill those empty boxes. Increasingly, they are looking to non-retail uses to serve a rapidly changing demographic.

“It’s really site-dependent,” says John Stevens, vice-president of leasing for CBRE, Sacramento, California. “In some cases, we have a Class A property with a C use that needs to be adapted.”

Many owners continue to turn to F&B to attract consumers seeking convenience and experience. The two largest generations in US history are the millennials, born between 1981 and 1996, and thus entering their prime spending years, and the baby boomers, born between 1946 and 1964, and now in or nearing retirement. These cohorts are looking for socialisation — and to avoid cooking. Previously at an average of 10% in US properties, it is estimated that dining and entertainment could reach 25% or more in top-level US centres.

MAPIC PREVIEW • 81 • October 2019

But with that shift comes risk.

“The nature of food has always been experimenting with concepts, and there tends to be more turnover,” says Chicago-based Todd Caruso, senior managing director of CBRE. Though the oft-cited statistic that 90% of restaurants fail in their first year is false, an Ohio University study did note a 60% failure rate in year one, and an 80% failure rate after five years.

Planning ahead is key: it pays to have a deep bench of prospective tenants that can use a space.

Even so, “there probably will be some scaling back in some food categories”, Caruso says.

The recent trend towards food halls requires input from the community, notes Naveen Jaggi, president of JLL retail advisory and capital markets in the

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REGIONS: NORTH AMERICA Americas. “You can’t do a McDonald’s of food halls,” he says.

“They have to be organic.”

Even though the sector is less over-built than in the US and thus seeing fewer closures, Canadian developers and managers also are looking to increase the percentage of gross leasable area allocated to F&B. Ivanhoe Cambridge, for example, will up the space allocated to F&B from 9%-12% to as much as 20%, Coss says.

“We’ll continue to look at food and beverage, from micro-grocers to food halls,” he adds.

“All of these revolve around food — good food. But will we go to 50%? No.” One project that is dedicating significant space to food is the long-awaited American Dream in East Rutherford, New Jersey. The project will open to the public on October 25, with 55% of its 4.5 million sq ft (418,063 sq m) dedicated to entertainment and dining. This includes a Nickelodeon Universe theme park and a DreamWorks Water Park, North America’s first indoor snow-sports centre, an NHL-size skating and hockey facility, and a miniature golf experience, as well as more than

Ivanhoe Cambridge’s Creative, including an expansion in partnership with Cirque du Soleil

100 dining options and retail.

Future phases will add hotels to the property.

“Creating a destination or ‘place’ where one makes truly unique and memorable experiences is in our DNA,” according to the company. “We are a social gathering hub for the local community and visitors traveling from around the globe — a place for discovery, entertainment and togetherness.”

Meanwhile, Ivanhoe Cambridge has partnered with Cirque du Soleil to expand Creactive, which includes gymnastics-style training and play.

In July, Simon Property Group, the largest owner of malls in the US, announced a partnership with e-sports operator Allied Esports to build locations for competitions. Uses such as brewhouses, bowling alleys and axe-throwing (yes, really) have become popular in both urban areas and suburban properties, and often include F&B as well, CBRE’s Caruso points out.

“The big thing we’ve seen is the need for experience — about creating a visceral connection that’s not transactional,” says Fri Forjindam, chief development officer of Mycotoo, a Pasadena, California-based development company that creates location-based and live entertainment. “We look at it as creating an authentic place.

Whether we’re creating a full theme park or a museum exhibit, we need to know why a place is relevant. That in itself starts a story.”

The story is critical to achieving return visits: it’s impor-

tant to know how an entertainment facility will operate going forward, including how it will be updated, and how the experience it offers will change at different times of day. Equally important will be investment from community-input developers. “They’re going to have to have some skin in the game and we’re starting to see that shift,” Forjindam adds.

A growing sector, especially in urban areas, is medical facilities such as walk-in urgent-care centres which offer basic services. Essentially, these are a subset of the office sector, says Lee Block, executive vice-president of Winick Realty Group, New York.

“We’re finding tenants such as urgent-care facilities, day-care centres and schools are taking traditional spaces and making long-term deals,” he adds. “It shows that landlords are getting more creative. In prior years, they may have wanted the ‘cool’ apparel tenant.”

Fri Forjindam, Mycotoo:

Nike New York flagship: Rethinking the store

“We look at it as creating an authentic place.

Whether it’s a full theme park or a museum exhibit, we need to know why a place is relevant. That in itself starts a story” MAPIC PREVIEW • 83 • October 2019

REGIONS: NORTH AMERICA Lee Block, Winick Realty Group:

“We’re finding tenants such as urgent-care facilities, day-care centres and schools are taking traditional spaces and making long-term deals. It shows landlords are getting more creative” These tenants also can be much more appealing financially, as they typically sign a longer term deal and make a significant financial investment in equipment. But CBRE’s Caruso warns that these uses may not make sense for every property.

More sophisticated healthcare uses, such as sleep labs, wellness centres, hospitals and testing facilities, remain a possibility, but require more time and care.

“The interest in the medical field is still there, but it moves slowly,” JLL’s Jaggi says. “They may take a year or two to make a decision. Most are not publicly held and don’t have the pressure to deliver for Wall Street, so they can move at a slower pace.”

Co-working spaces have become a tenant of choice, as they bring possible shoppers into a project during week days, which is typically a slow time. A number of shared office-space operators have partnered with US mall owners — Industrious, for example, has opened locations at Taubman’s The Mall At Short Hills in New Jersey and Macerich’s Broadway Plaza in Walnut Creek, California. In fact, the appeal is so great that real estate companies are creating their own versions, including CBRE’s flexible-space Hana, which is rolling out to class-A assets in the top 25 US cities as well as London, with future growth expected throughout Europe, the Middle East and

Paris Baguette has signed six leases in Manhattan, with more expected

Africa. A Dallas location opened in August, with Irvine, California to debut later this year.

“We are committed to solving the needs of our clients and that means continuing to iterate on our product to meet them where they are,” says Brian Harrington, Hana’s chief experience officer. “As such, we may place Hana solutions in the suburbs,

at transit hubs, retail locations, airports and more.”

Harrington adds: “We believe that the demand for flexible space will continue to evolve to include a variety of different spaces and property types, coupled with technology and amenities that enable people to accomplish their goals.”

Suburban projects close to large

PUTTING RETAIL SPACE TO WORK CO-WORKING space is predicted to grow at retail properties by 25% annually through to 2023, according to a report from real estate advisor JLL. By this date, shared office space is expected to account for roughly 3.4 million sq ft (31,587 sq m) of retail space, JLL concluded from surveying 75 co-working locations at malls, strip centres and within street-level retail shops across the US. Developer Macerich is the first mall owner to land a multi-property deal with a shared office-space provider. Industrious has roughly 50 locations in 33 cities across the US.

Other popular co-working businesses popping up around existing retail centres include Regus and WeWork. The latter is starting to lease space from Hudson’s Bay’s Lord & Taylor building and has opened its own ‘store’

as it expands beyond co-working.

Macerich says that goal is to create “top-tier, builtin amenities for today’s professionals” at its malls, which also include Tyson’s Corner in Virginia. Industrious’ first mall location is

MAPIC PREVIEW • 84 • October 2019

set to open in Scottsdale in January, with a wider roll-out to follow.

Unibail-Rodamco-Westfield and General Growth Properties (GGP) have already started experimenting with co-working in the mall. A start-up called Cowork at the Mall is taking the empty Sports Authority in Chicago’s Water Tower Place mall, owned

by GGP. In San Francisco, Westfield’s Center on Market Street now rents space to a co-working company called Bespoke.

In New York, Westfield has brought WeWork into the Fulton Center shops — an extension of Westfield’s World Trade Center.

REGIONS: NORTH AMERICA metropolitan areas also are adding residential components to create urban living centres. These tend to dominate urban gateway areas.

Options are limited once you leave major markets, JLL’s Jaggi notes. “We are seeing residence concepts,” he says, adding that ‘Opportunity Zones’, which offer tax incentives to build in under-served communities, could assist: “If the city co-invests, that’s an interesting angle.”

But traditional tenants should not be counted out — as long as they remain flexible. “You have to create a space that encourages people to dwell longer, and create a variety of experiences within that space that connect emotionally with consumers, with the flexibility to programme multiple events,” Coss says.

Meanwhile, successful retailers such as American Girl have continued to adapt to changing

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ick Realty Group’s Block. “You can make deals that perhaps you couldn’t before, because the landlords had an eye on a different user, or because the space has become more affordable.”

But don’t expect rapid evolution. The US is in the 10th year of economic expansion, Jaggi points out — the longest recovery of the post-Second World War era. And until the 2020 US presidential election takes shape, changes will be slow.

Specialists like Sephora are out-performing the market

generations, Caruso points out — just as they will have to learn the needs of Gen Z, which follows on the heels of the millennials. With rents declining in major urban areas, fashion and other retailers have a new opportunity.

“We represent tenants who are well positioned to take advantage of these market conditions,” such as fast casual bakery Paris Baguette, which has signed six leases in Manhattan and is negotiating several more,” adds Win-

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REGIONS: ASIA

Smart retail shines despite political clouds A growing middle class and the rapid take-up of online commerce and mobile shopping continue to drive the Asian retail market, despite the economic and political disruption of the past year. All eyes are now on India, where overseas investment is pouring in, writes Mark Faithfull

C

HINA continues to dominate the economic landscape of Asia, but this has not been a vintage year. The country is locked in an unpredictable trade standoff with the US, while one of the region’s retail powerhouses, Hong Kong, has been rocked by political turmoil and pro-democracy street protests.

A number of major retailers have reported a slowdown in Hong Kong, one of the world’s largest luxury retail markets.

Richemont and Swatch Group are among the luxury brands to have been hit by store closures and the drop in tourist arrivals, with Swatch reporting a 27% decline in the export of its watches to Hong Kong in June.

The drop in foreign visitors to stores in June — the month the street protests began — was estimated at somewhere between 30%-50%. Brands including Prada, Ralph Lauren and Levi Strauss have seen sales plummet

amid the unrest.

InterContinental Hotels Group reported a decline in business travel to China on the back of the trade war with the US and the unrest in Hong Kong. And Macau casino revenue dropped 3.5% in July amid the escalating Hong Kong protests. These are unusual times indeed for a market more accustomed to relentless year-on-year retail-sales increases.

Perhaps driven by the changing retail landscape, retailers’ strategies are changing. Suning Xiaodian, the convenience-store arm of online retailer Suning. com, is a case in point. This year, the company acquired 61 Circle K outlets in Guangzhou from Hong Kong giant Feng Group, consolidating its foothold in southern China. Suning has been pushing to increase its number of stores, including department stores, supermarkets and convenience stores.

In addition to setting up new outlets, the omni-channel re-

Pro-democracy protests have rocked Hong Kong’s retail economy

tailer is acquiring existing locations from chain-store operators. Alibaba-backed Suning acquired Spanish multinational Dia Group’s China retail operations in April last year, taking over more than 300 Dia Tiantian outlets in Shanghai. In late 2018, Suning bought 31 stores in the central Chinese city of Xi’an from Grea Convenience.

This was followed, early this year, by the acquisition of 37 department stores from the Chinese conglomerate Wanda Group and, in June, an 80% stake in hypermarket operator Carrefour China, for which Suning paid RMB4.8bn ($695.7m).

According to Bian Nong, president of Suning’s con-

MAPIC PREVIEW • 87 • October 2019

sumer-goods business group, Suning expects the Circle K management teams running the stores and their experience in merchandising, supply chains and regional networks to facilitate its move into Guangzhou and the broader South China market. The move comes at a time when German discounter Aldi has opened new concept stores in China and Costco has just opened its first store, which was inundated with shoppers upon opening.

Through the acquisition of 37 Wanda department stores, Suning.com (formerly Suning Commerce) plans to revamp its offline-shopping and department-store supply-chain opera-

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REGIONS: ASIA

Tencent Smart Retail’s Cecilia Tian

connections with consumers in physical environments easier.

Brands, she adds, will have to work out how to connect online with offline.

Tian points to “the massive adoption of technology” in China as a platform for new ways of retailing: “Scan-andpay is becoming very common in China,” she says. “This requires building trust and removing the fear of technology. That is very valuable. If you look at the results, almost 40% of consumers in a shop are using scanand-pay, which is driving a very unique experience.”

Photo Credit: Landini Associates

tions by leveraging the power of new technologies, including big data and AI. As a major player in China’s new retail market, Suning.com has been pushing its offline expansions in an effort to promote its smart retail solutions. The company aims to open 15,000 offline stores this year.

The deal is not surprising given the history between Suning and Wanda Group. Together with Tencent, JD.com and Sunac China Holdings, Suning. com purchased a 14% stake in Wanda Commercial Properties, Wanda’s real estate arm, for RMB34bn in 2018.

Leveraging technology to create a seamless online and offline experience to build sales from stores is creating new ways of shopping, according to Cecilia Tian, general manager of Tencent Smart Retail. She believes that China’s high adoption of services such as WeChat and QR codes makes

Cecilia Tian, Tencent Smart Retail:

“Scan-and-pay is becoming very common in China. This requires building trust and removing the fear of technology. That is very valuable” But Tian believes that the online experience should start with real relationships: “Fundamentally, we want the relationship to start face to face, offline, where people feel comfortable building a relationship.”

Part of this approach is to encourage sales people to engage with the consumer. “Staff and shoppers can be connected by WeChat.,” Tian adds. “We are seeing a lot of good results coming out of that.” The benefits include a rise in sales orders when a store is physically closed, because shoppers can still talk to assistants via WeChat.

Over in Singapore, the marriage of technology and physical space was brought into sharp relief this sum-

German discounter Aldi has entered China with a bold new concept

mer by the opening of Funan, one of the island state’s bestknown retail locations. Marking the beginning of a new chapter in its evolution, Funan opened its doors to shoppers in late June after a three-year redevelopment programme. Home to some 190 brands clustered around six ‘passion’ themes — tech, craft, play, fitness, chic and taste — developer CapitaLand hopes that Funan will become the centre of commercial, social and cultural activities in Singapore’s Civic District.

More than 30% of Funan’s tenants are new-to-market brands, concepts or flagships. And reflecting its ambition to serve as a showcase for local talent, more than 60% of its brands originate from Singapore.

In one of the most futuristic developments, by year-end, shoppers can expect a robot-enabled hands-free shopping experience at Funan. A 24/7 click-and-collect drive-through service is also set to launch. And parking, too, has been made easier by new

MAPIC PREVIEW • 89 • October 2019

technology: of the centre’s 400 or so parking spaces, 36 have been set aside for its carpark reservation system, whereby drivers can book a day in advance via the CapitaStar app. Upon arrival, drivers are guided to their allocated lot by a video-based smart-car parking facility.

Behind the scenes, Funan uses video analytics to measure and analyse footfall throughout the mall and in each store. In-store, smart terminals further capture transaction data so that tenants can use the analytics to refine their offerings and enhance the customer experience.

Chris Chong, managing director of retail for CapitaLand Singapore, says that Funan re-imagines the mall as “a social space for discovery, learning and shopping, underpinned by a digital layer of customer experience to enhance satisfaction”. He adds: “With this configuration, CapitaLand aims to support retailers in embracing opportunities in the brave new world of bricks-and-clicks

REGIONS: ASIA by attracting and growing a responsive and vibrant community, powered by an eco-system of sensors and analytics to deepen consumer insight.”

Chris Chong, CapitaLand:

“The reimagined Funan is a social space for discovery, learning and shopping, underpinned by a digital layer of customer experience to enhance satisfaction” One of the retailers to open at Funan is Daiso’s ThreePpy retail store. Known as the ‘premium’ version of Japanese discounter Daiso, the first ThreePpy outlet in Singapore and SouthEast Asia offers kitchenware, household goods and stuffed toys, among other items. Daiso currently operates 22 ThreePpy shops in Japan and plans to add 30 more each year.

With 2,800 stores in Japan and over 4,000 worldwide, Daiso has established itself as ‘the Japanese dollar store’ since opening its first US outlet in 2005. It now has 78 stores across Washington, California and Texas, with more opening every year.

The chain, which already has a strong presence on the West Coast of the US, is now pushing into the New York metropolitan area. It opened its second store in the region — in Edgewater, New Jersey — this summer. With two additional stores scheduled to open in New York and more expected in New Jer sey, Daiso is poised for rapid growth. For its first East Coast locations, the retailer looked for neighbourhoods with a sizable Asian population, knowing that would give it an enthusiastic base among customers already familiar with the brand.

Similarly, women’s fashion and

CapitaLand’s Funan has introduced Singapore shoppers to a fusion of technology and place

accessories retailer Baroque Japan operates 18 brand portfolios, including Moussy, Sly, Enfold and Azul by Moussy, all of which have high name recognition in Japan, China and other parts of Asia. In all, it has 355 stores in Japan, 251 stores in China, three stores in Hong Kong and one store in the US. The company is attending MAPIC as it is interested in introducing overseas brands to Japan, as well as bringing its Japanese designed and made brands to Europe, Asia and the Middle

East. The company said that it is open to co-work as a franchise partner or JV partner.

The company is also interested in expanding its core brands in to South East Asia and Europe after its successful JV with a local retailer enabled it to expand to more than 250 Chinese stores, plus wholesale retailers for its brands including Moussy Vintage Jeans, which are available through Harrods department store in the UK. Investors are moving away from pure retail schemes, to develop

Iconsiam, on Bangkok’s Chao Phyraya River

MAPIC PREVIEW • 90 • October 2019

large scale, mixed-use projects, including Iconsiam, a $1.6bn development on Thai capital Bangkok’s Chao Phraya River.

The 750,000 sq m mega-destination includes retail, residential, offices and dining. But its retail areas are difficult to define, blending the mall with an eclectic mix of international names and local Thai artefacts.

All the architectural features of Sook Siam have been designed to make visitors feel as if they are in a large city, complete with streets, canals, and modern structures. ‘Icons within Icon’ is the design concept for the middle floors, featuring a set of four triplex retail towers, each of with its own 360-degree façade.

These unconventional structures afford the stores occupying them the opportunity to present their brand in a 360-degree environment. Iconsiam has been developed by Siam Piwat, Magnolia Quality Development Corporation and Charoen Pokphand Group.

Back in Japan, Mitsui Fudosan Co, headquartered in Tokyo, opened Mitsui Shopping Park LaLaport Numazu in the Higashishiiji district of Numazu

REGIONS: ASIA

Walmart continues to strengthen its position in India

City, Shizuoka Prefecture in early October. The centre has 214 stores in total, including 118 stores opening in eastern Shizuoka Prefecture for the first time. Alongside the stores, the scheme features Mercado De Samasa, a market combined with a food hall and an Italian restaurant to provide an experience that is “not just buying and not just eating”. Meanwhile, Numazu Grand Dining is one of the largest LaLaport food courts, with approximately 1,100 seats.

One of Japanese developer Aeonmall’s latest projects is the Noritake Garden Project in Nagoya, Japan, a mixed use office and retail centre sited where the Noritake Co pottery factory was established in 1904 and build-

ing on Noritake Garden, which opened in 2001. Aeonmall is developing a 57,000 sq m mixedused shopping mall due to open late 2021. A retail specialist, for Aeonmall this is its first mixed use project, with 37,000 sq m of retail and 22,700 of offices.

Within the complex, Aeonmall is incorporating a supermarket, post office, nursery, clinic and food court for convenience, with restaurants, lifestyle stores, a fitness club and cooking school, plus gardens for visitors and workers based around culture, heritage and relaxation.

The closing gap between online and offline is also evident in India. According to an India Brand Equity Foundation report, the subcontinent’s retail

Alibaba is extending its online and offline channels

Retail specialist Aeonmail is to open its first mixed-use scheme

market is expected to reach $1.2 trillion by 2021. Furthermore, total consumption expenditure is forecast to hit $3.6 trillion by 2020. The Indian market is also seeing solid momentum across online retail sales on the back of ongoing digitisation, and rising internet and smartphone penetration.

Last year, Walmart acquired 77% of Flipkart — India’s leading marketplace — and has plans to strengthen the latter’s grocery offering. This summer saw Amazon step up its efforts to expand its presence in the India retail market. The e-commerce giant initially revealed its intention to buy a minority stake of around 10% in Future Retail, owned by Kishore Biyani’s Future Group, and in August, in a complex deal, it actually acquired the equivalent of a circa 3.6% stake in the company, which is one of the largest retailers in India. Not only does the deal bolster its bricks-and-mortar presence in India, but it may pave the way for Amazon to strengthen its fresh-produce and vegetables delivery in the country.

Future Retail owns more than 2,000 stores across 400 Indian cities. More importantly, it operates Big Bazaar — one of the nine supermarket brands

MAPIC PREVIEW • 91 • October 2019

that it owns. Moreover, the retail group is expanding fashion-wear chain fbb rapidly.

Elsewhere, Alibaba is planning to invest $250-$300m in Indian online grocer BigBasket and is attempting to strike deals with Indian giants Reliance and Tata.

Reliance Retail and Reliance Industries’ plan to develop an ecommerce platform by combining Reliance Retail and Reliance Jio Infocomm. And online marketplace eBay is also planning to relaunch its Indian division.

So could the new decade see the retail axis spin from China to India? The latter has been a latent powerhouse ever since the potential of the BRIC economies became a thing. So far, however, India’s poor infrastructure and overseas-investment restrictions have hamstrung progress, but that appears to be changing.

As for China, its economy has been cooling irrespective of the recent political and trade turmoil. But empowered by ambition and cutting-edge technology, the country’s retail and real estate giants could yet turn their attention outwards to opportunities around the world.

CONFERENCES & EVENTS AT MAPIC

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MAPIC PREVIEW • 92 • October 2019

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MAPIC PREVIEW • 93 • October 2019

MAPIC free hotel shuttle

MAPIC AWARDS 2019

Honouring the new retail mix This year’s MAPIC Awards have been expanded to reflect the growing diversity of the retail and leisure sectors and recognise the influx of new players. And 2019 sees a new jury president in the shape of Resolution Property’s Mayte Legeay

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HIS year’s MAPIC Awards will be presented at a gala ceremony on Thursday, November 14 in Cannes. As in previous years, the red-carpet event will be attended by more than 300 of the most influential retail real estate professionals.

The winners will be selected by a hugely experienced awards jury — headed for the first time by Mayte Legeay, senior asset manager, Europe, for Resolution Property — drawn from all sectors of retail and all corners of the globe. And importantly, this year’s MAPIC Awards classifications have been expanded to represent the changing face of retail, with categories for pop-ups, F&B, leisure, city regeneration and future developments as well as a category dedicated to the best retail innovation.

New to the position of president, although not new to the MAPIC Awards jury, Legeay believes that the judges have a key role to play in shaping the future of the industry. “The retail sector is in constant evolution and the industry is facing challenges in order to embrace customers’ new behaviours,” Legeay says. “The MAPIC Awards aim to pay tribute to the influential and inspiring companies that are emerging as leading retail trend-makers.”

She adds that it is important to recognise and reward those companies whose innovative thinking and performancefocused solutions are “helping to build the

future of retail and lifestyle destinations”.

The MAPIC Awards also reflect the need to create the differentiated destinations and retail offers that are key to survival in today’s turbulent market.

“Retail is definitely alive and kicking, but it is experiencing great challenges,” Legeay says. “Retail is evolving fast and the industry needs to adapt.” She adds that, while some retailers are slowing down their storedevelopment programmes, there has been an increase in concepts including pop-up stores, temporary shop-in-shops, e-shops and outlets, as retailers adopt omni-channel as a full distribution strategy.

“There is a strong focus on regeneration and the optimisation of existing retail assets and destinations,” Legeay concludes. “There is a need to create something different — lifestyle hub destinations versus the classic shopping-centre proposition — in order to attract customers again.”

YOUR CHANCE TO VOTE MAPIC delegates will be invited to vote for their favourite project in each Awards category.

WHEN? From Wednesday 13 November, 9.00 to Thursday 14 November, noon.

WHERE? In the Awards Gallery (Palais-1) The final result will be weighted 70% to the Jury vote and 30% to the public vote.

MAPIC PREVIEW • 94 • October 2019

THE JURY President of the jury

Mayte Legeay Senior asset manager, Europe Resolution Property, UK

Alain Boutigny Editor-in-chief Sites Commerciaux, France

Edoardo Favro CEO RES Srl – Real Estate Strategist, Italy

Ana Guedes de Oliveira Executive director, developments Sonae Sierra, Portugal

Barry Hughes Isabelle Hervouet Design director Benoy, US Group director of digital UnibailRodamcoWestfield, France

Anders Liljenstolpe Managing director, Russia and CIS JLL, Russia

Charles Read Managing director Blooloop, UK

Fabien Stutz Senior director of real estate and store construction, EMEA Nike, The Netherlands

Wilson Tan Chief retail innovation officer CapitaLand Group, Singapore

Gala dinner by reservation only:

Steffen Friedlein Managing director leasing ECE Projektmanagement, Germany

Stefan Sjostrand Global commercial and digital manager Ingka Centres, Sweden

Justin Taylor Co-founder P-Three, UK

For ticket information please contact MAPIC Awards co-ordinator Laurene Dureault at mapic.awards@reedmidem.com

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RETAIL REMIXED: RETHINKING SPACES & PLACES 200+ INTERNATIONAL EXPERTS WILL SPEAK AT MAPIC

Otto Ambagtsheer CEO VIA OUTLETS

Selma Belkhayat Deputy Managing Director AMS AFRICA

Sébastien Bismuth President JENNYFER

Olivier Bossard Group Chief Development Officer UNIBAIL-RODAMCOWESTFIELD

Sacha Bostoni Co-Founder JIMMY FAIRLY

Christophe Burckart Country Manager France & Monaco IWG

João Cepeda President & Creative Director TIME OUT MARKET

Aureliano Cicala General Manager MSC CRUISES

Antoine De Oliveria E Castro CEO PAREF GROUP

Jacques Ehrmann President / Executive Director CNCC FRANCE / ALTAREA COGEDIM

Winston Fisher CEO AREA15 - FISHER BROTHERS

Julia Goroschenya Director of Real Estate Development DECATHLON - OCTOBLUE

Julien Goubault Chief Communications Officer KLEPIERRE

Rebeca Guzman Vidal Group Head of Retail Strategy CHELSFIELD

Christine Hager Managing Director REDOS

Reginald Otten Country Manager France & Morocco EASYJET

Matteo Perino Chief Operations Officer EUROPACITY

Cécile Poujade Associate Director Retail & International SAGUEZ & PARTNERS

Julian Powell Director of Hospitality GALERIES LAFAYETTE

Charles Read Managing Director BLOOLOOP

Myf Ryan Strategic Marketing Director UNIBAIL-RODAMCOWESTFIELD

Guillaume Sadoux Partner - Head of Development ADG GROUP

Jibran Saleem-Sheikh Brand Acquisition Manager LANDSEC

Claude Sirois President Retail IVANHOE CAMBRIDGE

Hubert Stech Managing Director Germany & Benelux MULTI

Klaus Striebich CEO RARE ADVISE

Raphaëlle Toledano Partner FABERNOVEL

Jace Tyrrell Chief Executive NEW WEST END COMPANY

Quentin Vicas Development Director DUCASSE PARIS

Reinhard Winiwarter Managing Director / Publisher ACROSS MAGAZINE

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CONFERENCE & EVENT PROGRAMME

RETAIL REMIXED: RETHINKING SPACES AND PLACES TUESDAY 12 NOVEMBER 14.45-18.45 OUTLET SUMMIT [Majestic Hotel Cannes] - By invitation only Gold Sponsor: VIA Outlets - Silver Sponsors: ART Software Group, California Bliss, Fashion House Group, Neinver, Scalo Milano Outlet & More, Sushi Shop, TORG, Via Jurmala Outlet Village 19.30 WELCOME RECEPTION [Majestic Hotel Cannes] - Open to all delegates

WEDNESDAY 13 NOVEMBER CONFERENCE ROOM Palais Level -1

VERRIERE GRAND AUDITORIUM Palais Level 1

09.00-10.15 WHY FASHION RETAILERS ARE STILL ON TOP OF THE STORE GAME?

09.30-11.00

SNAPSHOT RUSSIA Co-organised with: RBC Sponsored by: ADG Group

NORTH AMERICA FORUM Gain insights into North American retail & retail real estate markets!

Part 1: USA Part 2: CANADA

11.00-11.45

11.00-12.00

WHY MOST SHOPPERS STILL CHOOSE BRICK & MORTAR STORES OVER E-COMMERCE? In partnership with: FEVAD

SNAPSHOT BELGIUM Co-organised with: Belgian Luxembourg Council for Retail & Shopping Centres

10.15-11.00

INNOVATION FORUM Palais Level -1 Sponsored by:

LEISURE ZONE Palais Level -1

PRIVATE TOURS [All-day long] Book your guided visit of the MAPIC Innovation Forum! eugenia.irvine@gmail.com 10.00-11.00 WORKSHOP - DATA: IS IT THE GAME CHANGER? Co-organised with: FCE - Edouard Detaille Consulting 11.00-12.00 WORKSHOP BLOCKCHAIN

10.45-12.00 LEISURE FLASH TALKS Find the best technologies & solutions to entertain your customers

12.00-12.45 SNAPSHOT UK

12.00-15.00

14.00-15.15

14.00-14.45

14.00-15.00

14.00-16.00

FOOD IN THE NEW MIX! In partnership with: Curtice Brothers, Food Service Vision & WhiteSpace Partners

SNAPSHOT LATIN AMERICA Co-organised with: Lizan Retail Advisors

WORKSHOP O2O Co-organised with: Altavia RetailTech

LEISURE TALKS STORY-TELLING @ WORK Co-organised with: TEA - Themed Entertainment Association Inspired by art, theatre, film & themed attractions, the speakers will challenge the view on the role of storytelling in the retail industry.

15.15-16.00 SNAPSHOT NORDICS Co-organised with: NCSC - Nordic Council of Shopping Centres 16.00-16.45 COSMETICS & BEAUTY, HEALTH, WELLNESS... TO ADD VALUE & BRING BENEFICIAL SYNERGIES IN THE TENANT MIX 16.45-17.30 SNAPSHOT SPAIN Co-organised with: AECC - Spanish Association of Shopping Centres

11.30-14.00 MULTI-UNIT FRANCHISE SUMMIT By invitation only [Majestic Hotel Cannes]

11.45-12.30 SNAPSHOT POLAND Co-organised with: Eurobuild CEE

OTHER LOCATIONS & EVENTS

14.45-15.30 SNAPSHOT NETHERLANDS Co-organised with: NRW Dutch Council of Shopping Centres 15.30-16.30 SNAPSHOT ITALY Organised by: CNCC - Italian Council of Shopping Centres Sponsored by: IGD SIIQ 16.30-18.00 ASIA FORUM Gain insights into Asian retail & retail real estate markets!

Co-organised with: Retail in Asia

15.00-16.00 INNOVATION FLASH TALKS Discover the latest innovations to increase the performance of your shopping destinations

EUROPACITY Private session [Salon Croisette, Level 3]

15.00-16.00 RETAIL FLASH TALKS Spot & connect with international in-vogue retailers & new brands [Retailers’ Lounge, Riviera 8]

16.00-17.00 DEVELOPING CINEMA & LEISURE IN EMERGING & MATURE MARKETS Organised by: Department for International Trade In partnership with: The Big Picture

17.30-18.15

17.30-19.00

HOW CO-WORKING, CO-LIVING AND CULTURAL CHANGES REDEFINE RETAIL AS A SERVICE?

THE MEDELAN: PROJECTED TO THE FUTURE...

Private session & cocktail Organised by DeA Capital Fondo Broggi In association with PAREF [Salon Croisette, Level 3]

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Conference programme sponsored by:

Bronze Sponsors:

E U R O PA C I T Y Special thanks to our international partners:

THURSDAY 14 NOVEMBER CONFERENCE ROOM Palais Level -1

VERRIERE GRAND AUDITORIUM Palais Level 1

09.15-10.00 CEOs VISION: STRATEGIES & AMBITIONS FOR THE NEXT DECADE 10.00-11.00 RETHINKING CITY CENTRES: THE NEW TENANT MIX Co-organised with: ESSEC Business School 11.00-13.00 FRANCE FORUM Part 1: Fashion retail is not dead!

Part 2: Retailtainment or the new art of retailing Part 3: Retail sites & new usages Co-organised with: CNCC - French Council of Shopping Centres & INfluencia

09.30-10.15 SNAPSHOT SWITZERLAND Co-organised with: SCC - Swiss Council Community 10.30-12.00 LA MATINALE DE L’ECO Private session Organised by: Métropole Nice Côte d’Azur

INNOVATION FORUM Palais Level -1 Sponsored by:

OTHER LOCATIONS & EVENTS

LEISURE ZONE Palais Level -1

PRIVATE TOURS [All-day long] Book your guided visit of the MAPIC Innovation Forum! eugenia.irvine@gmail.com 10.00-11.00 WORKSHOP - LOGISTICS: FROM SHOPPING TO SHIPPING Co-organised with: Institut du Commerce 11.00-12.00 INNOVATION FLASH TALKS Discover the latest innovations to increase the performance of your shopping destinations

10.00-11.00

10.45-12.00 LEISURE FLASH TALKS Find the best technologies & solutions to entertain your customers

RETAIL FLASH TALKS Spot & connect with international in-vogue retailers & new brands [Retailers’ Lounge, Riviera 8]

13.00-14.30 ITALIAN LUNCH

14.00-14.45 WHAT ARE THE NEW OPPORTUNITIES FOR (RETAIL) REAL ESTATE INVESTMENT?

By invitation only

Sponsored by: IGD SIIQ In partnership with: CNCC Italy

14.00-15.00

14.00-16.00

WORKSHOP PAYMENT

LEISURE TALKS TECHNOLOGY @ PLAY Co-organised with: TEA - Themed Entertainment Association The speakers will present the combination of play and technology as one of the key factors in designing engaging retail leisure spaces.

14.45-15.30 SNAPSHOT MIDDLE EAST Co-organised with: MECS+R - Middle East Council of Shopping Centres & Retail 15.30-16.15 ICONIC PLACES AND “LOVE BRAND” STRATEGIES: HOW TO CREATE EMOTIONS & PASSION BETWEEN CUSTOMERS, BRANDS & PLACES Co-organised with: Saguez and Partners

15.00-16.00

15.30-16.15 SNAPSHOT GERMANY Co-organised with: GCSC - German Council of Shopping Centres

INNOVATION FLASH TALKS Discover the latest innovations to increase the performance of your shopping destinations

19.00-23.00

16.15-17.00 THE NEW MIX IN MODERN DEVELOPMENTS & REGENERATION PROJECTS Co-organised with: ACROSS Magazine 17.00-17.45

MAPIC AWARDS GALA DINNER By registration only [Martinez Hotel Cannes]

16.15-17.00 SNAPSHOT AFRICA Co-organised with: Broll Property Group

23.00 MAPIC PARTY Open to all delegates [Martinez Hotel Cannes]

HOW TO ENHANCE CUSTOMERS’ HOSPITALITY EXPERIENCE WHILE MAINTAINING STANDARDS Co-organised with: MKG Group

2019 THEMES

17.45-19.15 ITALY: NEW DEVELOPMENT PROJECTS Co-organised with: CNCC - Italian Council of Shopping Centres Sponsored by: IGD SIIQ

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RETAIL REMIXED: RETHINKING SPACES AND PLACES

SHOPPING THE WORLD

INNOVATION

LEISURE

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PREVIEW October 2019 www.mapic.com

// DIRECTOR OF PUBLICATIONS // Paul Zilk

// MARKETING DIRECTOR // Mathieu Regnault

/ EDITORIAL DEPARTMENT / Editor in Chief Mark Faithfull Contributors Ben Cooper, Debra Hazel, Annelies Keus, Isobel Lee, Liz Morrell, Sarah Morris, Graham Parker, John Ryan Sub Editor Joanna Stephens Proof reader Debbie Lincoln Editorial Management Boutique Editions Head of Graphic Studio Herve Traisnel Graphic Studio Manager Frederic Beauseigneur Graphic Designer Carole Peres

/ GRAPHIC DESIGN AND LAYOUT /

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Reed MIDEM, a joint stock company (SAS), with a capital of €310.000, 662 003 557 R.C.S. NANTERRE, having offices located at 27-33 Quai Alphonse Le Gallo - 92100 BOULOGNE-BILLANCOURT (FRANCE), VAT number FR91 662 003 557. Contents © 2019, Reed MIDEM Market Publications.

Publication registered 4th quarter 2019. ISSN 1961-022X. Printed on PEFC certified paper.

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Palais des Festivals, Cannes, France 13 – 15 November 2019

2019 Special focus:

Retail remixed: Rethinking spaces and places How can property owners build & reshape lifestyle destinations to suit the changing face of retail?

Join the conversation @MAPICWorld #MAPIC #ReinventingRetail

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Visit us at MAPIC, stand

R7.G14

30 MIN. That’s all you have to wait to get the new, in-stock sneakers you found on otto.de from your nearest ECE shopping center. This is because for around 60% of Germany’s population, the closest ECE center is less than a half hour away. You won’t be able match this speed – not even in your new running shoes! www.ece.com/connected-commerce

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