Transcription
ICSC European Retail Property SchoolRESEARCH & SELECTIONOF TENANTSAvi Alkaş, CRX, CSM, CMD, CLSChairmanJLL Turkey
WHAT IS LEASING?Lease: a transfer of rights to the possession and enjoyment of propertyfor a definite period of time.The signed agreement between landlord and tenant that establishesresponsibility, set standards, and states what is recoverable fromtenants for the maintenance process.ICSC’s Dictionary, 2nd Edition22
WHY THE NEED FOR RESEARCH?
I. WHY MARKETING AND RESEARCH?Research Is Building Block for Knowledge Research : Process of collecting, analyzing andsynthesizing information for the purpose ofmaking knowledgeable business decisions––– Understanding demographics & psychographics of atrade area,Analyzing a center’s potential customer profile andshopping habitsTo determine the prospective tenants for the centerKnowledge based on FACTS rather than opinionsor assumptions
S.W.O.T.Strength, GY(Solution)TACTICS(Execution)Results
WHY RESEARCH?Leasing Requires Knowledge Knowledge of population statistics,demographics and lifestyle of trade areathrough market researchClear target market definition of the centerLeasing strategies to meet thecharacteristics of the given trade area
WHY RESEARCH?21st Century Leasing Requires Knowledge Knowledge-based leasing– DATAMarket research defines the tenant mix needed to meetconsumer demands within a particular trade area andhelps to eliminate opportunistic leasingOn-going trade area research to follow dynamic& changing needsCaution : Always Use Recent DataINFORMATIONKNOWLEDGEWISDOM
WHY RESEARCH?Utilization of research Maximizes CompetitiveAdvantageStrongmarketKnowledgeBetter targeted andfocusedleasing planMore Successful andDifferentiatedShopping Center
NO TENANT NO CENTRE99
AGENDA1. Shopping centre concept2. The market Tenant mix and categories Leasing strategy3. Finding and identifying the right tenants1010
1. SHOPPING CENTRE DEFINITIONSShopping centre: a group of retail restaurants and othercommercial establishments that is planned, developed,owned, and managed as a single property The 3 mainconfigurations of shopping centres are enclosed malls, openair centres and hybrid centres.ICSC’s Dictionary, 2nd Edition1111
1. SHOPPING CENTRE DEFINITIONS
1. SHOPPING CENTRE DEFINITIONS
1. TYPES OF CENTRES Super regional SC: 80 000 sqmSimilar to a regional centre, but because of its larger size, has moreanchors, a deeper selection of merchandise, and draws from a largerpopulation base. Typical enclosed, with multilevels.ICSC’s Dictionary, 2nd Edition Regional SC:40 – 80 000 sqmProvides general merchandise (large part is apparel) and services in fulldepth and variety. Main attractions are its anchors such as massmerchant, fashion, department stores etc.ICSC’s Dictionary, 2nd Edition Neighbourhood SC: Small local centre:1420 – 40 000 sqm5 – 20 000 sqm14
1. TYPES OF CENTRES Shopping centres: power centres etc Factory outlets Retail parks, Fashion parks Themed centres Hybrid centres1515
1. CONCEPTWhat determines the concept?Projects/new centresRefurbishment Market share unknownUse existing knowledge: Reliance on market studies Commercial/data Focus on return on investment rentalincome Limited freedom Relative freedom to organize mix1616
2. MARKET – THE CONSUMER DECIDESTenants categories and typesa. Tenants categories/trendsb. Merchandising/tenant mix1717
2a. TENANT CATEGORIES Anchor stores Key tenants Line tenants Mom and pop stores1818
2a. STORE DEFINITIONS Anchor Store: 1 000 sqm Junior anchor/MSU: 500 – 1 000 sqm Average store unit: 250 – 500 sqm Satellite store: 250 sqm1919
2a. THE ROLE OF ANCHOR TENANTSWhat is an anchor tenant?– A major store (usually a chain) in a shopping centre having substantial economic strength, occupying a large square footage.– A major department store branch in a shopping centre.– Stores that occupy the largest spaces in a centre,– serve as the primary traffic generators.ICSC’s Dictionary, 2nd EditionAnchors: Make the centre commercially viable vs financially in itself Being (one of) the primary draw(s) of customers Occupies the largest spaces of a shopping centre2020
2a. TENANT CATEGORIES ANDCLUSTERINGTenant categoriesAggregated Category1 Daily goods2 Fashion21Mandatory CategorySub Category11 Hypermarkets12 Supermarkets13 Miscellaneous goods and specialist food11112113113213313413514 Beauty and health products141 Cosmetics and Toiletries142 Pharmacies and Medical stores143 Health Food stores21 Fashion ; small units211 Men's wear (GLA 500 m2)212 Women's wear (GLA 500 m2)Hypermarkets (GLA 4.000 m2)Supermarkets (GLA 4.000 m2)Flower shopsMagazines- and newspapers storesTobacconistsButchers, Bakeries, Liquor storesPet shops, Zoo shops21
2a. TENANT CATEGORIES 4025026029031032033034035036039022Ready wearWomen’s WearMen’s WearUnisexSportwearLeather, shoes, bagsUnderwear / Swimwear /SocksKids’s wearOtherJewelryAccessoriesOptics / WatchesCosmeticsBeauty Center / SpaHairdresserHealth Club / SolariumOtherSpecialty Gourmet StoreFast FoodRestaurantsCoffeshopsDried fruits / Candy /ChocolateWine House / TobaccoOther410100RETAIL SECTOR CATEGORIESReady wear200300400Beauty / Health / AccessoriesFood&BeverageHome500Hobby / Gifts / Specialty Ret.600700800/ 900Culture / Art / 0CinemaBowlingTheaterKids play areaArt 0490510520530540550560570590FurnitureWhite goods / Electronics /GSMHome accessoriesHome textileIlluminationHome DecorationOtherMusic / BooksStationaryOutdoor sports accessoriesToys & ModelsComputer / ComputerGamesPetshopSpecialty StoresOtherDry cleaningLocksmith, Bootblack,TailorDrugstorePhoto / PhotocopyTravel AgencyFlower shopBank / ExchangeOther810820830840850860870890Department StoreDIY (Do-it-yourself)Discount Department StoreAutomobileShowroomOfficeHypermarket /SupermarketOther22
2b. MERCHANDISING/TENANT MIXTenant mixTenant mix is a critical variable when planning a commercial area andwill have a major impact on: the commercial profile of the business the visitors we want to attract2323
2b. MERCHANDISING MIX/TENANTMIX/MERCHANDISING PLANMerchandising plan: an overall plan locating merchandise mixthroughout the lease plan.Lease plan: a detailed plan showing the size and configuration of eachspace located within the shopping centre.Merchandise plan: a forecast of all major elements that enter into grossmargin.ICSC’s Dictionary, 2nd Edition2424
2b. TENANT MIXWhat is the right tenant mix?Right for the centre what the shopper wants (keep in mind when putting mix together, notonly yield focus, it will pay off).2525
2b. RENT ROLL AND THEMERCHANDISING MIX/DESIGN You need a merchandising mix/plan in order to complete a rent roll. They go TOGETHER! Each unit is unique, therefore its value is different from itsneighbour’s value.268 m shopfront16 m shopfrontRent XRent X 3Reduced visibilityRent X - 326
2b. CATEGORY ANALYSISOptical/Jewellery/Watch(Rent)600Asian MallMiscellaneousSmall Fashion450Footwear and leatherBeauty and HealthChildren’s wear and toysF&B300Average:Large FashionHome Furniture150Entertainment & ,00020,00025,000Size27(sqm)
2b. DISTRIBUTION OF CATEGORIESCategoryF&BAudioBeauty & health productsChildren's wear & toysFootwear & leather goodsFurniture & household goodsFashion Over 500sqmFashion Under 500sqmAsia MallSportsOptical goods, watches, jewelleryElectrical goodsEntertainment & leisureMiscellanous goods & servicesSupermarketHypermarketTotal GLA28GLA 2525,8003,95414,74017,6535,1001,00020,000160,000% of Total 9.2%11.0%3.2%0.6%12.5%100%# of Tenants574401539211712917412312461145428
2b. THE MARKETMarket Studies & Trade Areas: Demographics Competition Pre-letting (tenants interest)Evolving the mix, adaptation to behaviour, environment,competitionTaking into account new shopping habits, internet, click and pick –New trendsUse/clusters vs. Price-point positioning(cultural differences)2929
2b. COMPETITION MAP: Lublin, PLno changeEcho, 70TGLA, 2013Agreement with the City signedOLIMP, 2TGLA, 2012Extenssion – CinemaE.Leclerc, 13TGLA, 2011ExtenssionFELICITY, 80TGLA,New agreements with TenantsINTERBUD, 55TGLA, 2013Looking for a partnerGALA, 120(exist.15)TGLA,Extenssion303030
2b. COMPETITION MAP: Lublin, PL3131
2b. COMMERCIAL CONCEPT – AN EXAMPLE Format: Super regional shopping centre ( 80 000 sqm GLA) Target: Mid to mid-high income families Core customers: Fashion conscious women age 25-45 and highspending late teens/young adults. Concept: Mix of international and national retailers supported byhypermarket, substantial F&B offer, cinema and entertainment Planned anchors:» Full size hypermarket (12 – 25 000 sqm)» Electronic store, Sport, Toys, Furniture» Substantial F&B offer (5% - 20% of GLA)» Junior anchors, fashion (Zara, H&M, C&A, etc.)» Entertainment (cinema, arcade, kids education, etc.)3232
2b. COMMERCIAL PLAN EXECUTIONBased on the overall concept: Identify and prioritize possible anchors Define tenant categories incl. mandatory category leaders Divide into sub-categories Cluster and allocate space Name, size, rental income and main conditions3333
2b. THE MARKET - CONCLUSIONRequirements to achieve a good tenant mix Knowing brands, trends, new concepts, bestsellers Thorough analysis of market and competition Knowing the retailers(their business; good relationship)3434
2b. CONCLUSIONRequirements to achieve a good tenant mix Individual retail identity (positioning) and clear retail clustering areas important as the tenant mix itself. Lease Strategy must be carefully planned and organized Secure the best possible tenant mix by adapting to local marketconditions.3535
III. RESEARCH: VITAL AND NECESSARYA. Project Assessment and Viability4. Best Use/Risk Analysis–“Highest and Best Use” Physically Possible Legally Permissible Financially Feasible Maximally Productive
III. RESEARCH: VITAL AND NECESSARYB.Understanding the Market/Consumer1.How, What, Where They Make Purchases Consumers iousquality-consciousprice-consicence
III. RESEARCH: VITAL AND NECESSARYB.Understanding the Market/Consumer Consumers look for– convenience– attractive shopping atmospheres– impeccable service
III. RESEARCH: VITAL AND NECESSARYB.Understanding the Market/Consumer2.Population Concentrations, Growth Areas Knowledge of target catchment area–Population statistics
III. RESEARCH: VITAL AND NECESSARY
III. RESEARCH: VITAL AND NECESSARYGAYRİ SAFİ MİLLİ HASILA*GROSS NATIONAL PRODUCT*BEYKOZ 2528.75 BEŞİKTAŞ 8429.95 KADIKÖY 4659.44 KARTAL 3782.55 MALTEPE 1671.00 SARIYER 2193.13 ÜMRANİYE 1825.60 ÜSKÜDAR 2664.72 ŞİŞLİ 13866.09 * KAYNAK: DEVLET İSTATİSTİK ENSTİTÜSÜ* SOURCE: STATE STATISTICS INSTITUTENÜFUSCATCHMENT 1 Km:23,6775 Km:587,02710 Km: 2,140,329
III. RESEARCH: VITAL AND NECESSARYB.Understanding the Market/Consumer3.Demographics Vital–––––––statistics of the marketing areapopulation,age and sex distribution,average income levels,number of children,education level,unemployment level,socioeconomic level Basic neutral, unbiased data about potential shoppers in ageographic area can be inferred
III. RESEARCH: VITAL AND NECESSARYExample : AN OUTLET CENTERPOTENTIAL RESEARCH INISTANBULbyAKADEMETRE in 2003
III. RESEARCH: VITAL AND NECESSARYResearch took place in the following districts with theindicated ratio:Research koyAvcilarFatihSisliBesiktasKadikoyKartal
III. RESEARCH: VITAL AND NECESSARYIn these city districts, the followingGender Distribution exists :GenderWomen; 48,6Men; 51,4
III. RESEARCH: VITAL AND NECESSARYThe Education Distribution is asfollows :Education Status6048,85040302030,718,4102,10Primary Sc hooland LowerHigh schoolCollegeGraduate
III. RESEARCH: VITAL AND NECESSARYMonthly Personal Incomedistribution is as follows:Personal Income - MONTHLY3026,3252016,517,214,815107,48,42,150250 mil. 250 - 350 350 - 500 500 - 750And lowermilmilmil750 - 1mil1-3 mil3 mil andhigher
III. RESEARCH: VITAL AND NECESSARYB.Understanding the Market/ConsumerPsychographics Populations are grouped, not according todemographic statisticsalone, but according tolife style clusters too.Case Study Bluewater -1Bluewter 3
III. RESEARCH: VITAL AND NECESSARYC.Knowledge Is Greater & Faster Than Ever1. Technological AdvancesCommunication of all means–Internet – Magnificent tool of our era Searching for competitorsSearching for statisticsNetworking Easy questionnaires /ValuationsPolls &
III. RESEARCH: VITAL AND NECESSARY
III. RESEARCH: VITAL AND NECESSARY
III. RESEARCH: VITAL AND NECESSARYC.Knowledge Is Greater & Faster Than Ever2.Growing Sophistication Of Shopping CenterProfessionals Knowledge is shared through bothinternational and national industry &professional associationsMore information available to moreprofessionals through periodic meetings(fairs, seminars, conferences) and advancedcommunication means (internet, e-groups,etc)
III. RESEARCH: VITAL AND NECESSARYC. Knowledge Is Greater & Faster Than Ever3.Greater Acceptance of Research in Both Retailand Real Estate (cont’d) –Differentiate from other retailersNational and international site selection processAnalysis of governmental, sociological,technological, economic factors, economicstrengths and weaknesses of a locationMore successful and guaranteed results ifresearch is done
III. RESEARCH: VITAL AND NECESSARYC. Knowledge Is Greater & Faster Than Ever3.Greater Acceptance of Research in Both Retailand Real Estate (cont’d) Real Estate–To add value during the developmentprocess Providing informationAnalyzing information and creating knowledgeSimilar approach with retailer research––Location analysis / trade area analysisTo Make more informed and correct decisions
III. RESEARCH: VITAL AND NECESSARYD. Research Sources ICSCResearch companiesInternetState Statistics InstituteIndustry booksIndustry magazines, periodicalsSimple observation of major marketplayersContacts with retailers
III. RESEARCH: VITAL AND NECESSARYE.Using Research to MakeLease Plan DecisionsSearch for New Tenant Concepts Health and beautySports and recreationIndulgences Eating EducationFunNesting Take Away FoodPersonal financeDay spa, health clubExtremesports/ interactiveFrench pastries,Belgian ChocolateOutdoor, ethnic chains,quick casualBookstore/café/eventsArtplex, skateparkHome entertainment,furnishingsPrepared gourmet foodsStock broker, banking
III. RESEARCH: VITAL AND NECESSARY1. Refining the Merchandising Plan–b. “Twig” Units/Brand Extensions
III. RESEARCH: VITAL AND NECESSARY1. Refining the Merchandising Planc. Entertainment Concepts World Examples––––Xanadu Madrid: Ski pistAlmada Forum : Climbing WallBudapest : OceanariumGalleria : Ice skating
III. RESEARCH: VITAL AND NECESSARYENTERTAINMENT CONCEPTSKI PIST - SPAINALMADA FORUM PORTUGAL
III. RESEARCH: VITAL AND NECESSARYENTERTAINMENT CONCEPTGALLERIA - ISTANBUL
III. RESEARCH: VITAL AND NECESSARYENTERTAINMENT CONCEPTTropicarium Oceanarium, Budapest
III. RESEARCH: VITAL AND NECESSARYENTERTAINMENT CONCEPT
III. RESEARCH: VITAL AND NECESSARY1. Refining the Merchandising Plan–d. Dining
III. RESEARCH: VITAL AND NECESSARYRefining the Merchandising Plan–e.Leisure ConceptsEASTON PARK COLUMBUS
III. RESEARCH: VITAL AND NECESSARYE.Using Research to Make Lease Plan Decisions2. Recognizing Market Realitiesa. Successful Concepts Must Appeal tothe Greater Marketb. Research Should Not BeManipulated to Paint A False Picture
3. FINDING & IDENTIFYING TENANTSFinding the right tenants: Positioning (existing centres) /Commercial concept (projects) Marketing – Marketing material / trade fairs / iPads & other electronicsupport Long standing relations – a tenant brings a new tenant Agents6666
3. IDENTIFYING TENANTSPositioning Pure retail vs leisure & entertainment vs F&B etc- Complexity: role of hard discounters and value retailers that make itconfusing to organize and target. Brands- Importance of brands vs categories- Different cultural appreciation6767
3. FINDING & IDENTIFYING TENANTSApproaching tenant & merchandising mixstrategy – checklist Target, list and rank the best retailers in each category based onbrand recognition, range, performance and customer expectation, allclearly clustered and easy for visitors to overview and grasp. Focus on Junior Fashion Anchors Focus on Newcomers-First-to-Market and/or unique tenants68 Diversify Tenant Mix – ensure that one category does not dominatetoo much, especially in markets where the same fashion brands arefound at all competing shopping centres.68
3. FINDING & IDENTIFYING TENANTSApproaching tenant & merchandising mixstrategy - checklist Price points range – ensure broad appeal, particularly with middleprice point. Support tenant mix with services, food & beverages, playgrounds,sport and other leisure facilities to make the mall more attractive andto prolong the dwell time. Bring in food stores to increase frequency. Strive for at least 40% cross border retailers.6969
3. IDENTIFYING TENANTSBrands The strength and importance of brands vs categories Brands take the lead over pure mix: Apple, A&F, Primark etc.7070
3. B2B MARKETINGAn example: Leasing brochures7171
3. B2B MARKETINGAn example: Leasing brochures7272
3. B2B MARKETINGAn example: Leasing brochuresWhat other key info will yougenerallyfind in a Leasing Brochure?Hint: something that startswith a ‘C’ something that startswith a ‘D’ and what else?7373
Thank You!.Avi Alkaş, CRX, CSM, CMD,CLSChairmanJLL [email protected]
ICSC European PartnersICSC Global PartnerICSC European Partners
310 Specialty Gourmet Store 320 FastFood 330 Restaurants 340 Coffeshops 350 Dried fruits / Candy / Chocolate 360 WineHouse/Tobacco 390 Other 410 Furniture 420 Whitegoods/Electronics/ GSM 430 Homeaccessories 440 Hometextile 450 Illumination 460 Home Decoration 490 Other 510 Music/Books 520 Statio
