Resolution Property has embarked on the expansion of its retail outlet centre in the Netherlands ahead of a spate of new schemes hitting the market

Resolution Property has embarked on the expansion of its retail outlet centre in the Netherlands ahead of a spate of new schemes hitting the market

The opening of an 8,000 m2 expansion at Resolution’s Rosada Fashion Outlet in the Dutch city of Roosendaal next spring is seen as the opportunity to re-affirm its position in the market. ‘An opportunity like this only comes around once and you have to use it to the full,’ said managing director Gerben Boomsma of Stable International, the Dutch manager of Rosada and contracted developer of the expansion for Resolution.

Resolution, the London-based value-add European real estate fund manager, acquired Rosada from CBRE Global Investors back in 2012. The expansion will add over 30 retail units and food and beverage options to strengthen Rosada’s appeal for consumers. The expanded scheme will have 125 units over 24,000 m2.

Resolution says it is bringing its long experience in the European outlet centre to bear. ‘Investing in outlet centres has more in common with running a business than simply putting money into real estate,’ said Michel Nangia of Resolution’s asset management team. ‘Through hands-on, day-to-day management and good marketing you can also increase the value of the bricks and mortar.’

Growing competition
Resolution and Stable will need to draw on their combined experience in the outlet sector as the Dutch landscape is set to change drastically. In the coming years Dutch consumers searching for bargains in outlet brand villages will have more and more choice about where to spend their money as new schemes open.

Spanish retail specialist Neinver is opening Amsterdam The Style Outlets, located in the town of Halfweg between Amsterdam and Haarlem, in 2017; Dutch player Provast plans to open an outlet in the western Dutch city of Zoetermeer at end-2018, while Stable is involved in two projects in the east of the country.

Meanwhile, the new owners of Batavia Stad outlet centre in the northern Dutch city of Lelystad are also seeking to strengthen its profile. The first outlet centre in the Netherlands, Batavia Stad features 100 retail units on 26,000 m2. It was acquired by VIA Outlets, a joint venture between UK REIT Hammerson, Dutch pension fund asset manager APG and European retail asset manager Meyer Bergman – for €102 mln in March 2014. In addition, outlet specialist McArthurGlen is adding 10,000 m2 to Designer Outlet Roermond, which is already the best performing scheme in the Netherlands.

Resolution and Stable launched work on the expansion at Rosada during the summer to remain competitive in the crowded marketplace. ‘This is a necessary expansion,’ Nangia said. ‘Consumers will be able to transform a trip to Rosada into an outing for the day.’

Given the limited size of the catchment area for outlet centres, with most schemes within a 1-1.5-hour-drive from anywhere in the country, it is inevitable that everyone is fishing in the same pond. Resolution is therefore cautious about new investment in the Dutch outlet market. ‘First let’s see how the expansion at Rosada settles in the market and what other projects are coming,’ Nangia said.

That said, Resolution is more than happy with the scheme at Roosendaal, according to Nangia. The centre was opened by developer McMahon Development Group in 2006 and sold to ING REIM (now CBRE Global Investors). When Resolution bought it from CBRE GI six years later the asset had a vacancy rate of 24%. Nangia: ‘We acquired Rosada because we saw there was room for improvement. As a result of intensive asset management the vacancy rate has been reduced to 5%.’

Double-digit sales increases
Retailer sales have increased by double digits in recent years, Boomsma added. Last year sales volumes rose by 14% on the back of 10% higher visitor numbers. In the first half of 2015 sales at Rosada were up 11% despite lower Dutch consumer spending figures.

Boomsma attributes the performance to hands-on management: ‘We have daily insight into the key indicators; not just retailer sales volumes but also visitor numbers, the number of transactions and the number of sold products that these figures are based on. Using this data we can evaluate our marketing offers and events.’ Performance is key as outlet rents comprise a basic rate plus a flexible element linked to sales revenue, something which is a big draw for investors.
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By Gabriëlle Klaver
PropertyNL

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