Turnover is the New Black
Saturday 27 February 2010
Yvonne Court of Cushman’s in my view is one of the most consistent research consultants in the industry. In today’s Property Week she reckons the time has come for retail property to reinvent itself. Taking a look at my previous blogs you’ll see how we intend to do just that.
But one quote stood out for me: “The challenge ahead for retailers will be how to continue to develop their businesses in a market where there is a dearth of good-quality retail space and a significantly reduced development pipeline, particularly beyond 2012”.
Landlords are similarly struggling to deal with rental deflation and a lease expiry bubble in about 6 years time is simply adding to the misery. Because successful retailers underpin successful shopping centres the industry needs to realise that keeping customers captive (L&T Act ’54) is simply old-fashioned – setting them free will sharpen up your marketing skills and keep them coming back. Turnover rents are the new black.
I-AM sees both sides of the argument and is trying its hardest to persuade landlords that working with tenants is far more productive for both businesses in the post-recession, post-Google post Tesco Clubcard age. The game has changed.
So, to help owners and occupiers in secondary shopping centres “develop their businesses”, here’s what we’d do to add value.
1. We’d streamline
2. We’d inspire
3. We’d Innovate
4. We’d surprise
5. We’d modernise
Because our ideas are built on information, these benefits would all be measurable. Doing more of what works and less of what doesn’t soon becomes a darn sight easier.
Feel free to comment,
Mike.
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