The findings of a recent analysis by UK data intelligence company CACI must have put smiles on the faces of managers at Paris-based retail giant Unibail-Rodamco.
The findings of a recent analysis by UK data intelligence company CACI must have put smiles on the faces of managers at Paris-based retail giant Unibail-Rodamco.
The report concluded that shoppers who make use of catering options at retail locations spend 48% more during their shopping expedition. Different types of catering outlets available to shoppers strongly influence how much they spend, the survey found. For example, increases in spending in 2013 were largely driven by larger amounts of money forked out in restaurants rather than cafes and fast food establishments where a slight fall was recorded.
The findings are based on 170,000 exit interviews with shoppers in over 100 retail centres across the UK as part of CACI’s annual Shopper Dimensions report. Admittedly, Unibail-Rodamco does not have any shopping centres in the UK and it would be unwise to extrapolate the conclusions to its own malls without further evidence on shopping patterns on the Continent. Nevertheless, the survey does suggest a trend that Unibail-Rodamco has already anticipated with the launch of its Dining Experience at its Maquinista shopping centre in Barcelona in July 2012.
The programme is part of the Franco-Dutch property group’s strategy to put restaurants and gastronomy at the heart of its shopping experience which it is seeking to make ‘unique and exceptional’. Europe’s largest listed commercial property company plans to roll out the new dining concept in 25 malls by 2015, either by extending the mall’s existing space, or by converting vacant areas to new restaurants. The initial signs were already encouraging: shortly after the launch of the Dining Plaza at La Maquinista, traffic in the mall increased by 9%. No doubt, Unibail-Rodamco will also seek to roll out the Dining Experience at the Krokus shopping centre in Kraków, Poland where it is working on a redevelopment and extension together with the mall’s owner Valad Europe. In a press announcement this week, Arnaud Burlin, Unibail-Rodamco’s managing director for Central Europe said the redevelopment would add a further 50,000 m2 of GLA and transform the asset into a state-of-the-art jumbo shopping centre ‘in order to achieve an unprecedented level of customer experience in the city of Kraków’.
Designer outlets are sweetspot
Another sweet spot in the European retail sector is designer outlets. Last week, Spanish developer Neinver announced that the 15 outlet centres it manages in Europe received more than 39.4 million visits in 2013, up 12% from 2012. Additionally, total sales rose to €863.5 mln, which marked an 11% increase on 2012. As Andrew Rich, director of outlet malls at TIAA Henderson (formerly Henderson Global Investors) said this week, designer outlets have been one of the strongest performing retail sectors across Europe over the past decade. He made the comment following the announcement that TH and mall operator McArthurGlen have opened a 5,000 m2 second phase of their Barberino Designer Outlet in Tuscany, Italy, bringing the total GLA to over 27,000 m2. 'We are confident the second phase will drive investment performance even higher,' he said.
Elsewhere on the retail front, UK-based Intu Properties announced this week that it has bought malls in The Midlands, Derby and Northern Ireland worth £863 mln (€1.03 bn) from Westfield Group. The sale of the provincial UK assets is part of the plan by the listed, Australian mall operator to strategically reposition its international portfolio in line with its focus on investing and operating ‘iconic retail destinations in major world cities’. And in Spain, a prime mixed-use asset combining office and retail at Castellana, Madrid’s main avenue, has sparked a fierce bidding war among international investors eager to re-enter the Spanish property market at rock-bottom prices. According to well-informed sources, the complex which was formerly owned by bankrupt property group Reyal-Urbis before being repossessed by banks Banco Santander, Banco Bilbao Vizcaya Argentaria and the Bankia Group, has attracted over 20 offers exclusively from foreign investors. US investors Pimco and Perella Weinberg, as well as Anchorage Capital Partners from Australia are believed to have been shortlisted for the asset, which is expected to fetch around €150 mln.
Investor appetite is also finally heating up for the shopping centres CBRE Global Investors is looking to divest in Spain and Italy. In Spain, the European investment manager is believed to on the verge of selling the 84,900 m2 El Boulevard regional shopping centre in Vitoria, Northern Spain, for a yield below 6.75% after having received a dozen bids for the asset, which comprises 161 shops and 4,000 parking spaces. The cap rate compares to a net initial yield of 7.2% paid by Intu and CPPIB for the Parque Principado regional mall in late 2013, giving an indication of the extent to which values are rising as a result of growing competition in the market.
Judi Seebus
Editor in chief PropertyEU
Related articles
Shoppers who eat and drink, spend more
Unibail, Valad Europe to add 50,000 m2 to Krakow mall
Neinver outlets increase sales by 11% in 2013
Henderson opens another 5,000 m2 at Tuscan outlet mall
Intu spends €1b on three UK Westfield malls
Madrid's Castellana asset unleashes bidding war
CBREGI seeks buyers for 3 malls in Spain, Italy¨
Other headlines this week
Orion, AEW vie for major stake in Spanish Realia - report
Italy's Ideafimit seeks buyers for Atlantic 2 assets
Price tag of Poznan City Center put at €250m
Allianz seeks to boost retail portfolio
Moscow captures four of the top 10 malls in Europe
Rockspring targets €1.5b of deals in 2014
France's FdR sells logistics portfolio to Blackstone
Swedish offices look strong; Danes still distressed, says Genesta’s Palmgren
BAML, AXA REIM finance Lone Star's Coeur Defense buy
Pbb to increase new lending in 2014; privatisation on the cards for next year
Aareal Bank expects €8b of new lending in 2014
M&G raises €1.6b for junior mortgage funds
For more news from our daily newsletters, please go to our website and click on LAST 7 DAYS (ordered by date)