European retail property has held up well as an asset class during the crisis, but it is hard not to ignore the winds of change that are sweeping through the sector. In the latest chapter of its Retail 2020 study entitled 'The New Retail Rulebook: 5 Key Lessons from the Future', Jones Lang LaSalle predicts that by 2020, more than 50% of all non-food retail transactions will be digitally influenced in mature markets. Another forecast: up to 30% of retail space in developed markets is potentially obsolete in its current form. And finally, a wake-up call to landlords in mature markets: up to 15% of shopping centres could be unsellable from 2018 in certain countries such as the UK.
European retail property has held up well as an asset class during the crisis, but it is hard not to ignore the winds of change that are sweeping through the sector. In the latest chapter of its Retail 2020 study entitled 'The New Retail Rulebook: 5 Key Lessons from the Future', Jones Lang LaSalle predicts that by 2020, more than 50% of all non-food retail transactions will be digitally influenced in mature markets. Another forecast: up to 30% of retail space in developed markets is potentially obsolete in its current form. And finally, a wake-up call to landlords in mature markets: up to 15% of shopping centres could be unsellable from 2018 in certain countries such as the UK.
While the big listed investors and institutional players continue to target core properties in prime locations, dominance in big catchment areas alone is not enough to win over consumers. Consumer spending patterns are becoming less predictable and consumer profiles more complex in our highly competitive global market. A recent report by CBRE revealed that men are replacing women as shoppers of the future. ‘Across Europe, two in five people (40%) now shop online - and it's men not women that are driving the charge,' the adviser said.
The trend is not confined to young consumers: the poll was based on respondents aged between 16 and 65. At the same time, the effect age has on defining shopping habits differs widely across Europe: in Sweden there is little difference by age whereas in Russia and Poland the use of internet shopping reduces dramatically for those aged over 45 years. Nevertheless, the bottom line is that ecommerce is penetrating all levels of society and all generations. Even a growing number of senior citizens with more time on their hands to visit the shiny new temples for worshippers of international brands will explore the internet before embarking on a shopping expedition.
The full analysis appears in the November edition of PropertyEU Magazine. Click on the link below to subscribe and order your copy now
