Helsinki-listed retail landlord Citycon is adopting an integrated urban approach to new developments, the company's CEO Marcel Kokkeel has told PropertyEU.
The company is planning to demolish its existing shopping centre in Lippulaiva in Espoo (pictured), one of the wealthiest areas in Helsinki, and replace it with a scheme that will be more than double in size and which will accommodate public amenities including healthcare facilities and a library as well as 350 residential units.
While the shopping centre itself is not that old, the location is perfect for building a new urban centre, Kokkeel said. 'This centre will breathe new life into the area. You can't always build on the past; we’re taking a long-term view with this project.'
Scheduled for completion in 2020, the new Lippulaiva will host around 80 different shops, cafés, restaurants and services in addition to municipal services and health care facilities. The service offering will have a strong focus on groceries and other necessity driven retail, Kokkeel added. 'We will be creating a new part of the town and are adopting an integrated visitor approach with facilities including healthcare, education and culture. It would be a missed opportunity if we were to think about in terms of a retail destination only.'
Master-developer
The residential units will be developed by a specialist company while Citycon will play the role of master-developer, Kokkeel said. ‘This shows how active we are on a super-urban level, we’re focusing on more than shopping.’
The new metro station of the second phase of the Länsimetro extension and the terminal for connecting traffic will be located under the shopping centre.
While the residential element is new for Citycon, the company has a history of creating urban and multi-functional developments, Kokkeel said. ‘We already create urban well-connected locations and are focusing more on healthcare facilities and libraries. We think functionally and we think in terms of our customer needs and we already deal with the municipalities. This is a perfect match.’
Urbanised developments
All in all, Citycon is looking at developments valued at between €800 mln and €1 bn in the next five years, Kokkeel said. 'We are developing more and more as part of our goal to improve and expand our existing assets. As part of that objective, we will also urbanise developments where that can add more value within the portfolio.'
Elsewhere in the Helsinki area, Citycon is currently engaged in expanding Iso Omena, a 65,000m2 shopping centre in Espoo. The scheme is due to become one of the largest shopping centres in Finland following a 35,000 m2 extension which will take the total to 100,000 m2. 'Iso Omena will be more than just a shopping centre,’ Kokkeel said. 'The centre will also include a healthcare facility and medical services as well as a 3,500 m2 library.'
The beauty of these public services, he added, are that the buildings are leased on the basis of 50-year contracts. Moreover, public buildings like libraries and healthcare facilities create traffic, he said. 'The library at our Kista shopping centre in Stockholm brings in one million visitors a year.'
Leisure and entertainment
Leisure and entertainment are key features at Iso Omena as well, Kokkeel said. In November, Citycon signed a lease with Duudsonit Activity Park, a Finnish adventure park which will be located on the second floor of the shopping centre. The 4,000 m2 park is set to open in autumn 2017 and will replace the library and movie theatre, which are moving to new locations. This will be the chain’s first adventure park in the Helsinki metropolitan area.
The extended shopping centre will also accommodate a seven-screen movie theatre, the largest in Espoo. Set to open in April, the new Finnkino theatre will have over 900 seats, and its theatres will be equipped with the most advanced audio and visual systems.
Occupancy rate rises to 95%
In mid-December the retail landlord announced that it had signed up several major new tenants, bringing the occupancy rate to 95%. In addition to the expanded entertainment offering, the second phase of the Iso Omena enlargement will see the arrival of several top fashion brands, including Espoo’s first Zara and the recently signed Levi’s store. This follows the opening of a new Nespresso store last month.
Other anchor tenants in the extension include Lidl and H&M. Another key feature of the Iso Omena restaurant world M.E.E.T (Meet. Eat. Enjoy. Together) is also set to grow next spring, with the addition of about 30 new restaurants when the second phase opens. This will make Iso Omena home to the most diverse shopping centre restaurant cluster in the Nordic countries, offering a choice of 50 different restaurants and cafés with seating for 3,000 customers.
Altogether, the expanded centre will be setting a new standard in terms of entertainment and experience, Kokkeel said. 'The F&B concept will account for about 25% of the retail offering compared to an average of 9%. The Duudsonit activity park will also bring lots of customers.'
The project includes renovating part of the existing shopping centre, and the extension will be fully integrated with the new Matinkylä metro and bus terminal.
