Tenant Mix And Big Brands The Key To Secondary Shopping Centre Success

CBRE Research Analyses Secondary Shopping Centres Across Europe

A diverse range of shops and the presence of big brand retailers such as Primark, Apple and Zara are vital for a secondary shopping centre to be successful, according to a new study by global property advisor CBRE.

CBRE analysed a range of ‘good secondary shopping centres’* across Europe to identify the most important factors that contribute to a centre’s success. The research reveals that the quality of tenant mix is by far the most important factor ahead of good car access/parking and the ability to draw from a substantial catchment.

Tenant mix, and the presence of ‘high profile’ retailers, is the main reason why consumers shop in a particular location. Managers identified the three most sought-after retailers in their shopping centres – those that generate the biggest footfall. Regardless of size or standing in the retail hierarchy, each centre boasts key ‘anchors’ such as Zara, Primark or H&M. This demonstrates that many ‘high profile’ retailers have wide ranging store portfolios that include both prime and secondary locations.

Good car access and parking provision is rated highly by managers regardless of the size of the shopping centre or its location. This confirms the findings of CBRE’s recent report - How We Shop: Inside the Minds of Europe’s Consumer – that reveals shoppers’ strong preference for using their cars for both food and fashion shopping.

The research shows that good secondary shopping centres operate in all types of location: neighbourhood, district, sub-regional and regional. While the size of the catchment is considered an important factor, this is largely incidental to the success of the centre – it is the ability to capture spending from within this catchment. ‘Good’ secondary shopping centres also tend to have wealthier customers.

Albert Hoogland, Executive Director, Shopping Centre Management, CBRE, commented:

“Shopping centre managers can have a significant impact on the success of a centre, particularly if this is backed up by regular investment to keep the centre fresh and competitive. It is notable that the majority of successful centres either opened or had major refurbishments in the last 10 years, many of which were in the last five years. Conversely, poorer performing secondary centres typically suffer from a lack of investment, which is often connected to the ownership structure of the centre.

“It is clear that one size does not fit all - good secondary shopping centres can be large or small and operate in neighbourhood, district and regional locations. What does unite them is the ability to either dominate their catchment or capture sufficient spend from this catchment. To achieve this, a strong tenant mix is vital and needs to be appropriate for the size of the scheme and demographic profile of the area. Good car parking and access is also important, while cleanliness and security are considered a given by consumers - they must be done well.”

The location of a shopping centre within its urban environment is rated slightly more highly in the UK and The Netherlands where having a good location in a town or city is a pre-requisite. Italian shopping centres tend to be located in suburban or out-of-town locations which explains the relatively low rating. Good public transport is clearly an important success factor for some centres.

The level of competition in the town varied significantly, depending on the type of centre, the function it performs and the centre’s dominance within its catchment. In the larger cities, secondary shopping centres typically face substantial competition from other retailers, but this competition contributes to the critical mass and overall attraction of the city. Thus, if the secondary centre has sufficiently strong characteristics to attract shoppers, the nearby competition can also be considered as complementary.

EMEA ViewPoint Secondary Shopping Centres
EMEA ViewPoint Secondary Shopping Centres