ICSC: Internet hasn't killed the shopping centre

Shopping centres in Europe appear to be holding their own despite all the gloom and doom predictions that the rise of etailing has sounded the death knell for the sector.

In an environment where internet sales are growing strongly, shopping centres in Europe saw footfall rise 1% on a like-for-like basis in 2013, according to a survey presented by the International Council of Shopping Centers (ICSC) Europe at its annual conference in Istanbul this week.

Like-for-like footfall growth was strongest in southern Europe at 8.6% This was due, the researchers said, to a strong performance in Turkey and signs of improvement in Spain. Northern Europe also saw positive growth of 2.2% but footfall in Western and Eastern Europe was relatively flat (0.0% and 0.6% respectively).

Alexander Otto, chair of ICSC's European advisory board and CEO of shopping centre developer-investor ECE Projektmanagement, indicated that even the results for Western and Eastern Europe were a positive sign. 'This is very interesting data because there are a lot of headlines in the press about what the internet is doing to footfall in shopping centres; the end of shopping centres and the amount of retail space that is supposed to be phased out over the next couple of years.'

There is no question, he said, of the tremendous growth in internet sales. 'The growth in some areas is in double digits or just below 10%. Yet in some countries we are seeing very good footfall numbers. I think this is extremely positive and we see this in ECE's own portfolio.'

The ICSC Europe survey did not look at the correlation between footfall and the income generated by shopping centres. However, drawing on ECE's performance, Otto noted that its centres in Turkey - where footfall is rising strongly - recorded 'very strong turnover development' last year and the beginning of 2014 has also been positive.

In Germany - where footfall growth is flat - ECE still managed to chalk up a 0.8% like-for-like sales increase. Otto also noted that ECE manages one shopping centre in Moscow, Vremena Goda, which has the weakest footfall but the highest turnover. 'The difference is that if you have a few ladies coming out with big bags from Prada and Gucci it is easier to achieve (strong sales).'

More news on the footfall survey