BUSINESS, LIFESTYLE AND SHOPPING CENTERS
INTERVIEWS WITH SHOPPING CENTRES Concept Mall Bikini Berlin Palladium, Prague Punta Carretas Shopping, Uruguay Mall of Quatar Jewel Changi Airport Devt, Singapore
JUNE 2015 | www.shoppingmallexpert.com | 14,99 euro
25
YEARS OF CHINA SHOPPING CENTERS DEVELOPMENT
BEST COUNTRIES FOR
BUSINESS SHOPPING CENTRE MARKET
IN WESTERN EUROPE
Omar Khoory SHOPPING CENTER ON PALM ISLANDS
DIRECTOR NAKHEEL RETAIL
Source of inspiration Dear readers, The first edition of our brand-new international publication, the Shopping Mall Expert, has finally landed on your desks. Over the next pages, we share our knowledge and present our opinions on the expansion of the retail sector on the developing markets. With our expert analyses investigating the most important issues and trends in the sector, as well as crucial innovative concepts and technologies, we hope the magazine to become a source of inspiration for all of you. In this edition, we highly recommend reading the article on the functioning of the Chinese shopping centre market that was written by Victor Guo, the Chariman of China Shopping Center Development Association of Mall China. Right now, China is one of the leaders of the global market with over 3800 shopping centres of the total area of over 20,000 sq m, with a high chance of becoming the world leader in the near future. The situation in China will influence the retail sector on all of the other continents. What is interesting, the situation in Qatar looks a lot different. Phil McArthur, founder and Managing Director of McArthur + Company says that the Qatar shopping centres are obsolete and poorly maintained. Is the Mall of Qatar the answer to this problem? We are confident that all of the articles, interviews, and analyses published in the Shopping Mall Expert will provide you with valuable knowledge that will be able to use in everyday work. Because regardless of the geographic location, cultural differences or development stage, the goal is one and the same for all – plenty of satisfied tenants and malls full of customers. I wish you every success. Enjoy reading. Agnieszka Nejman Managing Editor
Q&A Enchanted garden
PUBLISHER: CentraNet s.c., Dominik Rybarczyk, Paweł Tracichleb ul. Wronczyńska 10, 60-102 Poznań centranet@centranet.pl, www.centranet.pl EDITORIAL OFFICE: Galerie Handlowe, ul. 28 Czerwca 1956 r. 314 c, 61-469 Poznań tel. + 48 (61) 282-17-24, biznes@galeriehandlowe.pl, www.galeriehandlowe.pl
Interview with PHILIP YIM, Chief Executive Officer, Jewel Changi Airport Devt
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DTP AND PHOTO EDITION: Joanna Szczepaniak, CentraNet s.c. MANAGING EDITOR OF THE Agnieszka Nejman SHOPPING MALL EXPERT: tel. + 48 (61) 415-51-24, contact@shoppingmallexpert.com EDITORIAL BOARD AND Marta Mrowińska, Hanna Marciniak, Klaudia Stanecka, Magdalena COLLABORATORS: Nowocin, Marta Wiśniewska, Agata Poturalska, Anna Chwałczyńska, Kamil Wyszkowski, Victor Guo The Editorial Board of The Shopping Mall Expert has a right to select the received material as well as to proofread and shorten the received texts. Unsolicited material will not be returned. All material published in The Shopping Mall Expert Report is protected by copyright. The Editorial Board is not liable for the content of advertisements and press releases. Non-contractual dissemination of publications is not allowed. Cover photo: Omar Khoory, courtesy of Nakheel Retail
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A gallery of beautiful memories Interview with PHIL MCARTHUR, managing director McARTHUR+COMPANY
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CONTENTS
FEUILLETON Not just consumer-oriented but also producer-oriented economy
ANALYSIS
48
Poland conquers international markets
EXPERT
42 SHOPPING CENTER ON THE PALM ISLANDS
54
25 years of China Shopping Centers Development
10 Sustainable development and shopping centers – hidden synergy
22
Interview with OMAR KHOORY, Director Nakheel Retail
REPORT Best countries for business The added value to the world of toys Interview with FÉLIX TENA, CEO and funder Imaginarium
Interview with BERNHARD TAUBENBERGER, head of communication and strategic marketing Concept Mall Bikini Berlin
24 Chi va piano, va sano, e va lontano Interview with STEFAN LINDENBERGER, Vapiano franchise owner in Poland
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Unique German minimalism
34 An imprisoned shopping center
Interview with JULIO DURLACHER, commercial director of Punta Carretas Shopping
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Shopping centre market in Western Europe
38 From barracks to a shopping mall Interview with KAROLÍNA PETERKOVÁ, Marketing Manager of Palladium at Property Solution s.r.o.
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NEWS
LIVE PAINTINGS On 15 April, the fashion brand Desigual decided to celebrate the World Art Day in an unusual way. The brand teamed up with Alexa Meade to create a series of images painted on bags and models’ bodies that, together with the backdrop, created a coherent piece of art. Alexa Meade is famous for painting portraits on human bodies and creating multi-dimensional works of art.
LEGO SHOPPING CENTRE An unusual construction appeared in the Toy Kingdom in Harrods. On the third floor, a 72000 Lego brick miniature sits, featuring the famed department store. The representatives of Harrods want to challenge all Lego lovers and encourage them to build their own versions of the city’s landmarks.
PEOPLE AS ANIMALS On 24 April, the biggest Lush store was opened on Oxford Street in London. The brand has also launched a new animal rights campaign. Members and activists from various organisations, such as Common Decency, The League Against Cruel Sports and Animal Aid, joined the Lush employees in their protest. Dressed in an unusual way, suffragette dresses, with animal masks on their faces, they marched the main streets of London. Carrying banners and handing out leaflets, the participants encouraged the passersby to check what their representatives in the upcoming May elections had to say about animal rights. For two decades, i.e. since the first Lush store was opened, the company has been organising international campaigns, fighting for animal rights and raising awareness of their customers all around the world.
HISTORY OF COUNTERFEITS Until 25 April, an interesting exhibition was held by the New York Fashion Institute of Technology. The “Faking It: Originals, Copies, and Counterfeits” exhibition investigated the history of fashion counterfeits. The visitors could admire the works of world-famous designers and their exact copies, both authorised and unauthorised. One of the most copied designer of all times was Coco Chanel, her tweed suits in particular. They were counterfeited so often, she eventually saw them as a form of publicity.
JEAN PAUL GAULTIER BACKPACKS Jean Paul Gaultier, the world-famous designer, designed a collection of backpacks for Eastpak. His products were inspired by the world of fashion, e.g. characteristic denim jacket or pilot style bomber jacket. Part of the profits from the sale of this unique collection will be donated to a designers organisation fighting with AIDS.
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NEWS
CANNOCK SHOPPING CENTRE SUPPORTS THE ELDERLY WITH DEMENTIA According to the Alzheimer’s Society in Great Britain, in 2015, 850,000 people may suffer from
dementia. According to the forecast, by 2021, the problem will have grown by 48% in the country. Addressing the issue, the Cannock Shopping Centre opened special clinics for the elderly at the mall and organised trainings for their personnel on how they can support this group of customers. Now staff members know how to help a person who got lost in the mall, forgot their home address or just felt unwell. During the workshops, the shopping centre employees also learned about signs of dementia. - More and more people suffer from dementia and it is important for them to feel safe when shopping at our centre - said Inderpal Bajwa, manager of the Cannock clinic. - We took several simple steps to ease the communication within the facility for the elderly. For example, we removed shiny floor tiles that can be mistaken for wet or slippery surface - he added. The Cannock Shopping Centre representatives say that it is just the beginning of positive changes at the mall.
CORNWALL CENTRE FIGHTS WITH BULLYING Nearly $5000 were collected during the Day of Pink fundraiser organised in the Cornwall Centre in Canada. The event aimed at raising awareness on bullying and at showing how to prevent and combat these harmful practices. The funds raised will be spent on training programmes to be organised in collaboration with the Red Cross at workplaces, schools and public utility facilities. One day, the customers of the Cornwall Centre could participate in building a symbolic wall representing the isolation of bullied people. To add a brick, people had to pay 1 dollar. At the end of the event, a white wall was built with a STOP sign on it.
BAL HARBOUR SHOPS AND VILLAGE OF MERRICK PARK JOIN THE EXCLUSIVE SHOPPING EXCURSION PROGRAMME
THE MALL WALTHAMSTOW COLLABORATES WITH A WORLDFAMOUS PHOTOGRAPHER Nadev Kander, a photographer famous for his pictures of Prince Charles or President Obama, has started collaboration with a British shopping Centre, the Mall Walthamstow. The artist opened his own photographic studio at the facility. Looking for simplicity and authenticity, he asked 85 volunteers to take part in a portrait photo shoot. Known for his collaboration with celebrities, he now decided to work with ordinary people. At the same time, a photography competition was held at the centre. Its participants were asked to photograph unique places at the facility. The lucky ones could consult their ideas with the master and get some advice with regard to their work. This type of events shows that shopping centres can become an inspiration for photographers, even the world-class ones.
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The Conrad Hotels & Resorts debuted its tailored luxury shopping experience for their customers during their stay in Miami. Two shopping centres were added to the guest package: Bal Harbour Shops and Village of Merrick Park. The hotel’s guests will not only have a chance to buy souvenirs but will also be provided with a one-of-a-kind luxurious experience. The participants will get access to top local boutiques in a chauffeur-driven car: Lincoln Navigator or Cadillac Escalade. Additionally, each shopper will be given a personal shopping escort. - The Shop the City programme is part of our relentless efforts to provide our guests with interesting ways to connect with the Miami culture. The guests will have a chance to enjoy Miami in its entirety, from luxury shops on the beach, through great restaurants, to historic monuments - says Stephane Mercier, General Manager of Conrad Miami. The programme is also available in the hotels in Dubai, Istanbul, Hong Kong and Beijing.
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NEWS
NORWOOD VILLAGE – A SHOPPING CENTRE IN A VILLAGE A new shopping centre is under construction in Australia. It is going to cost $50 million. The Norwood Village gallery will be commissioned in mid-2016. It will have not only shops but also a hotel, a park, playgrounds and restaurants. The shopping centre will be divided into several segments. In general, the whole area is designed to look like a big village. The visitors will have a chance to rent a room, shop or eat and relax at one of the restaurants with a view to the park. Passages between segments will be open and often outdoor. The paths connecting different parts of the gallery will be surrounded with green to make the visit even more pleasant. Moreover, the gallery will have a parking lot for 340 cars.
In Parañaque, a city in the Philippines, a new shopping centre is under construction. The gallery will be bigger, though only slightly, than the Mall of Asia of the area of 406,000 sq m. According to the plans, the new centre will occupy 407,000 sq m. The construction of the
THE BIGGEST SHOPPING CENTRE IN THE PHILIPPINES
Parañaque gallery will cost approx. $450 million. Apart from shops, the mall will also have a 12-storey hotel with 325 rooms. The visitors will also have a chance to play at one of the gallery’s many casinos. The facility will also lease office space, mainly for local entrepreneurs.
SHOPPING CENTRE IN HONOLULU WITH AUTOMATED PARKING SYSTEM The 808 Center will be developed in Honolulu, Hawaii. The investment will cost over $3 million and will be commissioned in the summer of 2015. Both retail and office space will be available at the gallery, though the biggest attraction for the customers visiting the centre will be, without any doubt, the automated parking system. This is a very innovative solution, so far available only in a few Asian countries. All of the cars arriving at the parking lot at the shopping centre will be automatically transported to specific parking spots. Right now, the only part of the centre that is occupied, is the retail space. Among current tenants are Urban Bistro, Dada Salon, Flower & Spoon and a karaoke bar.
THE BIGGEST SHOPPING CENTRE IN EASTERN AFRICA
EXTENSION OF THE CITY CENTRE MUSCAT The City Centre Muscat in Oman is going to be extended. The redevelopment will be completed in 2016. Right now, City Centre Muscat is one of the biggest malls in the region. As part of the extension, 60 new shops will be added to the mall’s tenant mix, such as F&F, New Look, and Bershka. The parking lot by the shopping centre will grow by additional 700 parking spots. Moreover, the cinema part of the mall will also be extended by another 10 screens. The lighting system will also undergo modernisation – old system will be replaced with LED technology. The interior design will also be changed – the new one will be more elegant and modern. Moreover, floors and ceilings will also be replaced so that the centre could have better acoustics. WWW.SHOPPINGMALLEXPERT.COM |
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A new shopping centre is under development in Eastern Africa. It will be the biggest mall in this part of the continent. The Mall of Kenya will be located in Nairobi. Apart from shops, customers will have wide access to various restaurants, hotels, and recreational areas. The Mall will occupy the area of 620,000 sq m and cost nearly $75 million. The biggest tenant will be the French hypermarket chain, Carrefour. The Mall of Kenya will also feature the Swarovski boutique and the Virgin Active club. The shopping centre will be mainly solar-powered, with almost the entire roof covered with solar panels. Additionally, the Mall’s neighbourhood will also be modernised and the nearby roads repaired so that the mall will be easily accessible for the customers. A special bus line is also planned to increase the number of visitors of the Mall. The centre will open in October 2015.
EXPERT
Photo: pixabay.com/ teetasse
25 YEARS OF CHINA SHOPPING CENTRES DEVELOPMENT China has truly become the most rapid growing economy for shopping centres around the world. By the end of 2014, in 50 major China cities, number of shopping malls with gross floor area of over 20 000 sq m amounted to 3 800. But every region has it problems and challenges. What are the main problems to solve in this part of the world? WWW.SHOPPINGMALLEXPERT.COM |
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pursuing the land development model and strata title sales income, resulting in severe compartmentalization between shopping centre development and operation towards an integrated system approach, lacking thorough and complete management control ability in synergizing the two. Currently, China shopping centres still experience difficulty in obtaining adequate support and response from professional financial investment institutions, where professional financial institutions lack the investment enthusiasm and intensity in general. Great majority of the funds entering into shopping centre development market still focus on land acquisition and short term development returns as the main objectives, thus, successful collaborations between a professional fund and shopping centre remain the exception, extending to a broader coverage in the industry would face extreme difficulties.
C
China shopping centres span a history of 25 years since its inception in 1990. According to the latest statistics from China Shopping Center Development Association of Mall China, by the end of 2014, in 50 major China cities, shopping centres with gross floor area of over 20000 sq m (leasing area of about 10000 sq m) amounted to 3800, with a total floor area that reached 250 million sq m. The composite growth rate for shopping centre gross floor area maintained at about 25% per year while the average floor area of shopping centres decreased to 66000 sq m, wherein, the quantity and floor area of large scale shopping centres more than 100 000 sq m ranked among top three in the global scene. By comparing the floor area and quantity of shopping centres in operation and those under construction in major cities, Shenyang, Chengdu, Tianjin, Chongqing, Xian and Wuhan would find themselves ranking atop the global league of shopping centre cities. Arguably, China has truly become the most rapid growing economy for shopping centres around the world and is expected to become the largest shopping centre market in the world. However, it is worth noting that, while the massing and quantity of China shopping centres have received much attention, the business conditions have also triggered widespread and massive concerns. Diverse intertwining factors like gaps in urban and retail facilities planning, restrictions in consumption capacity and growth, deficiencies in financial support policies, shortage of professional talents, lag in retailer development, etc. have posed considerable challenges to the sustainability of China shopping centres. While there continue to be an abundance of potential for unique case scenarios in particular markets, one had to concede that systemic risk for China shopping centres has increased at this stage.
Private enterprises were still the major investors for China shopping centres, which accounted for nearly 50%
The other 50% market share are mainly listed companies both domestic and foreign, state-owned enterprises, state holding enterprises, and Hong Kong invested or foreign-owned enterprises. Central government enterprises such as China Resources, COFCO, Air China Property, Overseas Chinese Town, Poly Real Estate and other famous organizations took full advantages of own resources and capital to create strong brand impact and professional accolades in the shopping centre sector, while regional state owned enterprises activity level was on the low side as a whole, those with relatively high nationwide influence included Suzhou Harmony Group, Beijing BSD, Guangzhou Parkview, etc., however, the total quantity is relatively low.
About foreign-invested and Hong Kong-invested organizations
Driven by Wal-Mart Real Estate, Inter IKEA, Capita Commercial, SCPG (original name: SZITIC), Taubman & Wangfujing, AEON Group strong market play, the pace of foreign shopping centre investors in China shopping centre development have notably accelerated in year 2014, and activity level have evidently increased too. Currently, foreign invested and Hong Kong invested shopping centres market share have entered an obviously upward trend. Even though shopping centres owned by foreign and Hong Kong invested enterprises made up less than 10% of the total, however, due to general superiority in funding, professionalism and resources, both the
China shopping centre main investors have become more diverse but investor structure remains singular
Of the national top 20 turnover shopping centers,
Firstly, residential real estate developers remain to be the main investors for China shopping centres. While some residential real estate developers have nonetheless achieve a certain degree of superiority both in terms of scale and professional ability, China shopping centres on the whole lack the extent of professionalization to match the current level of development scale. Residential developers still find themselves wanting coming to ideology and professionalism, hiding much uncertainty and insecurity underneath the market performance for most shopping centres. The most direct reflection would be that majority of residential developers still emphasize on
SHOPPING MALL EXPERT |
about 75% realized growth in performance
250 million sq m. in 2014 reached a total floor area of shopping centres with gross floor area of over 20000 sq m. in 50 major China cities 11
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EXPERT
China shopping centre development formats and major changes
business performance and asset returns have ranked amongst the top in the industry. This is inevitable outcome in view of the peculiar background of China shopping centre where industry risks and unique opportunities coexist. Specifically, foreign investments in the China shopping centre mainly come from the Asia region, including Southeast Asia, Japan and Hong Kong, and next, Europe, and the U.S.A. coming up third. With Mall China’s increased attention on the Australian market and frequent study trips and interaction, the connection between Australian and China shopping centres have become closer, the possibility of Australian enterprises entering the China market is on the rise.
The development formats and market structure of China shopping centre remain irrational. Super-regional centres and regional centres command almost absolute dominance during the first 25 years of shopping centre industry development. Quite a number of large scale shopper centres despite not possessing distinct features, but by right of a relatively extensive “big and comprehensive” trade mix strategy, had won consumer support and maximized market opportunities in a market environment without competition, however, due to the entrenched behavior of over reliance upon the “big and comprehensive” approach, resulted in imprecise positioning and inadequate resilience to market changes. Too many super-regional centres crowding the market have also suppressed the competitive vitality of middle and small retail enterprises in the vicinity to a certain extent. Under the new normal of sharp increase, dense distribution, and accelerated growth of super-regional centres and regional centres, consumer divergence are becoming widespread, viscous and disorder competition are on the rise. A section of China super-regional and regional centres have demonstrated the Matthew effect, where superior enterprises are increasingly prominent and weak enterprises are increasingly challenged.
China retail enterprises whose core business is department store are becoming the rising stars in the shopping centre industry
Innovation in the department store business has yet to experience effective breakthrough, in addition, real problems such as continual rise of rental resulting in operating costs facing intense pressure, as well as business performance lacking adequate drive, thus, quite a number of retail enterprises are considering giving up department store business and turn to commercial real estate development and operation, or attempt a fusion of the two. Investment into shopping centre sector for famous retail enterprises like In-time, Wangfujing, Brilliance, Rainbow has significantly increased. With the advent of commercial land development, crossover operation has become an important direction in business innovation for such retail enterprises. In general, department store businesses transforming into shopping centre has become a new trend in China retail business. Mall China is of the opinion that while market demands forced department store businesses into shopping centre development, the venture is mingled with both hope and fear. China department stores need to address the issue of lacking competitiveness at the core and never rely on a shift to shopping centre development, instead, should start with business deepening and customer service, with adequate deliberation in market segmentation, and unceasingly enrich and extend merchandise structure and service delivery, e.g., more rapid development of the groceries merchandise category is one of the important proposition and direction.
For a long period, China developers have a common regard for “high-end and classy” positioning tendency, where there were more shopping centre investors holding the perspective that perhaps shopping centres are destined to a more up-market presence than
Relatively, the performance growth of shopping centres was obviously better than the department stores in 2014
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Photo: pixabay.com/unsplash
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China shopping centre positioning characteristics and occurrent changes
other retail formats like traditional department store, etc., placing their hopes on extending catchment coverage and surpassing actual consumption power to take possession of competitor’s share. China shopping centre developers usually place more emphasis on leading consumer lifestyle and ignore meeting real demands, where upon subjection to practical challenges like relatively low rent affordability of some daily necessity and services brands, shopping centre operators would even dismiss trades that meet daily living needs, resulting in shopping centres becoming synonymous with high-end retail over quite some time, ignoring the development logic where shopping centres should be the service carrier for meeting daily living needs. The tendency of China shopping centres keeping distance from daily living and one-sided avant-garde fashion pursuit has artificially severed the lifestyle interconnection between shopping centres and consumers causing a loss in consumption.
China shopping centre urban expansion trail and occurrent changes
The development trail of China Shopping Center progressing from tier 1 to tier 2 and 3 and gradually to tier 3 and 4 is rather distinct, where tier 3 and 4 cities were once hotspots for shopping centres after year 2012. In the process, a number of quality shopping centres did sprung up in many tier 3 and 4 cities, relying upon certain advantages of a rich trade mix and scarcity of shopping centre in the region, creating a consumption bond between the shopping centre and quality lifestyle. Even though abundant opportunities exist for quality shopping centres in tiers 3 and 4 cities, it remains an undisputed fact that quality shopping centres do not constitute a high proportion overall in the industry.
China shopping center overall performance mingled with hope and fear
Looking at the overall performance of China shopping centre market in 2014, undoubtedly shopping centres led the pack coming to retail market growth; the performance growth of shopping centre relative to other retail channels was increasingly more prominent than it was in the past. Impacted by both online shopping and growth of shopping centres, China department stores continued to face huge pressure and challenges in 2014, some even to the extent of most severely tried ever in past many years, or growth rate slowed down, or performance fell, such have become common phenomenon in the industry. Relatively, the performance growth of shopping centres was obviously better than the department stores in 2014. Relying on sheer size and trade mix advantages, shopping centres enjoyed greater preference from consumers. Even then, in the face of continuing downturn in the market environment, future performance growth pressure begin to surface for shopping centres. Turnover growth rate for majority of shopping centres began to fall in 2014, where performance slow down for high-end shopping centres was more obvious. Of the national top 20 turnover shopping centres, about 75% realized growth in performance, while up to 25% experienced decline in performance, and tended to be mainly high-end positioning shopping centres. Coming to top 20 turnover shopping centres in Shanghai, the proportion for performance increase was 80%, close to 20% experienced different degrees of growth or performance decline.
On the whole, China shopping centres with high turnover or growth level mainly come from core areas or regional centres of developed commercial cities like Beijing, Shanghai, Guangzhou, Shenzhen, Nanjing, Hangzhou, etc.
China shopping centre overall business situation is mingled with both hope and fear
On future market direction, Mall China is of the opinion that shopping centres need to play the role and develop to the full the route of closely connecting to resident’s daily living, integrating rapid changes in consumption behavior, optimizing and innovating the brand and functional mix of new shopping centres, and strategically increase shopping frequency and consumer viscosity is indeed the priority among priorities. Shopping centre operation is a long term process of keep pace with the times, shopping centres need to convert from merely consider introducing what consumers what to buy in the past to become a destination and place that city residents hope to visit and to provide better and more exquisite services to consumers. This is the basic embodiment of the living support facilities and social services function that shopping centres should undertake. Currently, the obsession with big data application and O2O that China shopping centre market has entered into has obviously been deified, where some shopping centres even purported it as the only magic wand to success, as though shopping centres without which will lose fundamental competitiveness, the industry need to be on guard against such, especially not to over emphasize on one aspect in oblivion to others. Mall China is of the opinion that, for excellent enterprises, while it is imperative to further explore and put into practice the depths and breadths of such domains, where all big data will inevitably focus directly on consumer behavior and tap on potential service opportunities, however, from the perspective of the entire industry, considerable deficiencies and inadequacies exists among shopping centre enterprises, where service innovation and service upgrade are more pragmatic and direct solutions that commands high value and brings large opportunities. ☐
Victor GUO ...is the Chairman of China Shopping Center Development Association of Mall China, and Vice Chairman of CASC (Council of Asian Shopping Centers). Mr Guo was previously served in Ministry of Commerce of China, Ministry of Internal Trade of China and State Bureau of Internal Trade of China respectively. He was appointed as Founding Secretary General of China Federation of Urban Commercial Outlets Construction Administration, Vice Chairman and Director of CGCC Shopping Center Professional Committee. As one of the earliest professionals in researching and promoting shopping malls and retail property in China, Mr Guo has more than 12 years of industry experience and has published numerous professional theories and relevant literature in commercial real estate industry, such as “China Shopping Center Report”, “Shopping Center Research and Practice” and “Shopping Center Exploration and Development”.
Q&A
E NCHANTED GARDEN)
With one of the largest indoor collections of plants in Singapore, a 40-metres Rain Vortex and 300 shops, JEWEL CHANGI AIRPORT has a chance to become a truly unique and magical shopping destination on the world map. Because of its location it will attract not only local residents, but also tourists and travelers. Here, everyone will can feel like in Wonderland
Photo: Jewel Changi Airport Devt
Interview with PHILIP YIM, Chief Executive Officer, Jewel Changi Airport Devt
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Jewel Changi Airport will be a mixed-use complex featuring attractions, retail offerings, hotel and facilities for airport operations. What will be the biggest asset of this project?
Indoor garden sounds amazing.
Yes, it will be a really special place. The Forest Valley is a huge five-storey garden filled with thousands of trees, plants, ferns and shrubs. It will house one of the largest indoor collections of plants in Singapore – with about 22,000 sq m of space dedicated to landscaping throughout the complex. Visitors can immerse themselves in the beauty of nature within this idyllic valley of verdant landscaping and waterfalls, and can even take a hike up the valley in air-conditioned comfort. The Rain Vortex, at 40-metres high, is expected to be the world’s tallest indoor waterfall. Located at the central core of the complex, this majestic spectacle will captivate visitors with its magnificent water display. Come night fall, the Rain Vortex will transform into an enchanting Light and Sound show with special lighting effects.
A key vision for Jewel Changi Airport (Jewel) is to be a worldclass lifestyle destination that can attract tourists and transit passengers that will give Changi Airport an edge amidst intensifying competition on the global airports landscape. For Jewel to be a strong tourism product, it must contain a wide range of compelling lifestyle offerings that draw and excite visitors, including unique attractions and a shopping and dining experience of world-class standards. The tourism mindshare that Jewel brings will significantly boost Changi Airport’s status as a leading international air hub.
Photo: Jewel Changi Airport Devt
What was your inspiration to create this unusual project?
The concept for Jewel’s design stems from an extension of Singapore’s reputation of being a City in a Garden. It is also a juxtaposition where a park and a marketplace are situated side by side. Jewel’s unique design features the majestic Forest Valley and Rain Vortex in the middle of the complex, and surrounded by 300 retail stores and F&B restaurants located around both centrepiece attractions. In addition, we want to introduce the concept where the ‘outdoors are brought indoors’, so that visitors to Jewel will be able to enjoy nature, through our many gardens and falls, in air-conditioned comfort. The Canopy Park at Jewel’s level 5 is a good example of how we will be bringing a typical outdoor environment, with unique concepts such as garden dining, to an indoor space.
What attractions are planned in the entertainment part of this complex? Our vision is for the offerings in Jewel to be as inclusive and accessible as much as possible, so that both international visitors and local residents alike have the opportunity to enjoy Jewel’s facilities. Some of the attractions planned are playgrounds with engaging play facilities, which will appeal to both the young and old. There are also plans for a cineplex within Jewel and more information will be shared at a later date.
Who is responsible for the architectural concept?
Jewel is designed by a consortium of consultants comprising Safdie Architects led by world renowned architect Moshe Safdie, as well as Benoy and local architects RSP.
SHOPPING MALL EXPERT |
SINGAPORE
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Q&A
Jewel Changi Airport sq m GFA
134 000 21 700 18 500 3,5 hectares about 300 about 130 about 2 500 40-metres
sq m of indoor gardens and attractions sq m of facilities for airport operations
Site area (approximate)
number of shops
hotel rooms
Car park spaces
The Rain Vortex
Very attractive is the localization of the new project.
I totally agree. With its advantageous location right at the heart of Changi Airport and linked to Terminals 1, 2 and 3, Jewel is wellpositioned to serve the passengers, local residents and the airport community, who will constitute its customer base.
The centre will provide a wide shopping offer due to its size.
Jewel will have a total Gross Floor Area (GFA) of about 134,000 sq m, and Nett Lettable Area (NLA) will be approximately 54,000 sq m. There will be about 300 shops in Jewel, with about 30% of the space dedicated to F&B and the remaining to retail.
Among the tenants of Jewel Changi Airport will be international flagship stores and local labels.
The retail experience at Jewel will be customised and curated and the offerings will be unlike any other mall in Singapore. For instance, we will look at homegrown retailers, designers, and craftsmen to introduce a strong Singapore retail story to share with the world. There will also be opportunities for us to make shopping a discovery where people are exposed to the stories behind the products from all over the world. For transit travellers, they can refresh and re-energise with the variety of wellness and rejuvenation offerings that will be available in Jewel. We will also source for international brands that are new to
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Singapore and Asia. The integration of world-class retail brands and unique dining concepts with indoor gardens and leisure attractions will provide visitors with an amazing myriad of experiences all under one roof – making Jewel a one-of-a-kind lifestyle destination that can appeal to both tourists and local residents alike.
When the complex is scheduled to open?
Construction has already started, and Jewel is scheduled for completion by end 2018.
Changi Airport will be an effect of partnership between Changi Airport Group and CapitaLand. How previous experiences of this two leading names will help in the development of new project?
Strategically located in the heart of the airport, Jewel Changi Airport is envisaged to be a world-class lifestyle destination that will enable the Changi air hub to capture passenger mindshare, and strongly boost Singapore’s appeal as a stopover point for travellers
With the vision of Jewel as an iconic global attraction that can capture tourism mindshare on the world stage, there is a need to leverage the expertise of the stakeholders – Changi Airport Group (CAG) and CapitaLand. Changi Airport is the world’s most awarded airport, and CAG’s know-how and expertise in airport development and management, together with CapitaLand’s in-depth industry knowledge and extensive retailer network underpinning its position as one of Asia’s largest shopping mall developers, owners and managers, are strong leveraging factors for the Jewel team to develop a world-class mixed use complex that offers not just aviation facilities, but also exciting leisure attractions and comprehensive retail offerings.
Photo: Jewel Changi Airport Devt
What are your predictions for Jewel – how many clients and tourists will visit your project yearly? We expect a good mix of local repeat visitors and international visitors including tourists and transit/transfer passengers. Changi Airport handled a total of 54.1 million passenger movements in 2014 and this is a very attractive catchment group for Jewel, given its strategic location in the heart of the airport. Jewel is envisaged to be an iconic world-class attraction that will capture tourism mindshare, drawing international travellers to visit Changi Airport and Singapore. For local residents, we believe that the unique attractions and exciting retail offerings at Jewel will attract them to visit the complex repeatedly, with their families and friends. ☐
Agnieszka Nejman
SHOPPING MALL EXPERT |
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Q&A
A GALLERY OF BEAUTIFUL Today, every shopping centre strives not only for customers attention but also, and more importantly, for their loyalty. With the growing competition, the promise of pleasant and successful shopping is not enough anymore. That is why the MALL OF QATAR, with its exclusive entertainment offer, art shows and extravagant live shows inspired by Cirque du Soleil, and the biggest digital cinema screen in the world, strives to become a national monument. A visit to this centre is by no means a regular shopping experience. It is an unforgettable adventure Interview with PHIL MCARTHUR, managing director McARTHUR+COMPANY
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DOHA QUATAR
Mall of Qatar is an amazing and huge project and promise of worldclass shopping. What in your opinion will be the biggest asset of this new shopping centre?
of GBA with a rentable area of more than 200,000 sq m. There will be over 450 shops, services, restaurants and cafes. The total cost of the investment is confidential.
What was the inspiration to create this project?
The key anchor tenant of Mall of Qatar will be Carrefour. What other regional and international brands will be in new shopping center?
Mall of Qatar will represent the first international calibre shopping centre to be built in Qatar. Current mall supply suffers from being out of date and poorly maintained.
We are strategic consultants advising the owner of the Mall of Qatar. Mall supply is currently well under the regions average and our studies indicated a huge opportunity to develop in an area that also features Education City, The Qatar National Convention Centre, the new Metro, as well as new rail connectivity to all Gulf countries. ↓
Salam Fashion new 10,000 sq m department store, MAF’s new Carrefour design concept will elevate the guest experience through new merchandising and display techniques and decoration. All major retail groups from Qatar, Dubai, and the Gulf region will be present in the centre. Azadea group will be
« McARTUR+COMPANY
Mall of Qatar 31th March 2016 400,000 sq m GBA (first phase)
more than
Mall of Qatar will be located in Al Rayyan area. What are your predictions – how many clients and tourists will visit your centre yearly?
GLA (first phase)
450
Our primary and secondary market is well in excess of 1 million residents. We predict 20 million shoppers per annum in the first few years and good growth from there as Doha’s population increases from 2,3 million to 3 million to the end of the decade. Tourism is on the rise in Doha with great events, conferences, sporting events, wonderful winter weather, excellent hotels and soon world class shopping.
shops, services, restaurants and cafes
19-screen cinema complex
Could you please present your new investment in numbers?
The first phase of the mall is well in excess of 400,000 sq m
SHOPPING MALL EXPERT |
200,000 sq m
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www.mallofqatar.com.qa
opening date
Q&A
www.mallofqtar.com.qa
Mall of Qatar is strategically situated in the heart of the high net worth Al Rayyan area, with easy connectivity to over 75% of Qatar’s 2 million population. From 2022 it will be located right next to a FIFA World Cup Stadium
opening a full stable of Inditex brands (Zara, Massimo Dutti etc.) as well as Eataly, Virgin Mega Store and Decathlon. The Landmark and Apparel groups from Dubai will open a full stable of 35 international brands and F+B concepts.
I think that we can say, that Mall of Qatar is something more than just shopping.
a Five Star Luxury-Hotel.
We believe regional malls need hotels and Y PAN +COM other complementary community services. McARTUR Large malls in Dubai and elsewhere have some of the region’s highest occupancy rates. The hotel with be the Luxury fashion boutique, Curio Hotel by HILTON.
I totally agree. There are many initiatives in the design of Mall of Qatar that will be fresh and entertaining for the consumers. The QLIVE at the Oasis will be a trend setting live entertainment venue with new shows every day in a “Cirque du Soleil” style extravaganza. The mall will also feature a 19-screen cinema complex featuring 5 VIP theatres, a Sushi bar, a bowling alley and the world’s largest IMAX digital screen. Mall of Qatar will raise the bar in the variety of family entertainment options with Kids Mondo as well as adventure and thrill rides for the audience.
Some experts predict that shopping centres will losing ground to the increasing influence of online retail. Do you agree with this opinion?
QLIVE is the name of the live entertainment programming that will be a tremendous attraction and daily feature of the Mall. Faced with growing competition in the market, the owner of the mall has created Qatar’s largest live entertainment facility. QLIVE will be a defining feature of the Mall of Qatar. Nightly live performers will feature actors, singers, dancers, musicians and entertainers all choreographed into a large-scale performance.
I would agree that we have lost some market share to online shopping. Some services are well suited for online such as travel agencies, florist, and car rental. Fashion is hard to buy online if you care about the look and feel. It’s impossible to have a coffee with a friend online or join your friends to browse the mall and take in a movie. All that being said, the shopping centre industry must merge our traditional retailing methods with new age technology. Our consumers are shopping in multiple channels. Mall services should be utilizing RFID and near field technology to assist the shopper with way finding, concierge services and other customer friendly initiatives.
The Mall will feature not only retail units and luxury brands, but also
McARTHUR+COMPANY has international experience in providing the
Could you say something more about “QLIVE”?
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Mall of Qatar is a promise of worldclass shopping, outstanding dining and unique entertainment. It will feature 50 luxury brands, a five star luxury Hotel-curio-A collection by Hilton, 3 top department stores and many flagship shops McARTUR+COMPANY
leasing and marketing expertise. What in your opinion is the biggest challenge for shopping centres today?
Today is undersupplied however that will soon change as the there is a mall boom in Qatar that will see the opening of 20 new retail projects of all shapes and sizes. Only the well planned, leased and operating malls will succeed.
Challenges vary from region to region. We work with developers all over the world and they are constantly seeking new retail concepts from outside their region to help make their projects fresh. We also see shortage of educated, highly motivated shopping centre and retail professionals in many markets.
What future trends are you keeping an eye on? What trends can be important for shopping malls?
In the MENA region we are see a huge surge in mixed use, outdoor retail developments as well as in fill community and neighbourhood centres. We are also see a boom in new brands entering the Middle East and Asia. Regional Mall development is also on the rise with over 200 large scale mixed use developments and malls currently under development or planning in the MENA (Middle East and North Africa). ☐ Agnieszka Nejman
Any recipe for success?
The secret of retail real estate is to focus on retail and think retail. Our business is all about the sales our shops generate. Location, size, mix and arrangement of all centres needs to be thought from the retailer and consumer perspective.
How do you evaluate market of shopping centres in Qatar? www.mallofqatar.com.qa
The secret of retail real estate is to focus on retail and think retail. Our business is all about the sales our shops generate SHOPPING MALL EXPERT |
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| JUNE 2015
EXPERT
SUSTAINABLE DEVELOPMENT AND SHOPPING CENTRES – HIDDEN SYNERGY
Does sustainable development have anything to do with shopping centres? It has. A lot. Sustainable development fosters multidimensional improvement of the quality of life based on economic and social development while respecting natural environment. It is a chance for any country to choose the optimal growth model, where the society not only has the economic resources necessary to satisfy the basic needs but also a surplus to be spent on secondary needs and, finally, luxury goods. The development of the shopping centre market is based on the growing purchasing power of consumers which translates into strong synergy between sustainable development and the shopping centre market WWW.SHOPPINGMALLEXPERT.COM |
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Lack of sustainable development
having in mind that these solutions are not only eco-friendly and trendy but will also bring real savings. Another important area is optimal waste stream management. Responsible consumer always wants to know how a shopping centre manages expired products, whether they waste food, etc. As part of the UN Global Compact initiative in Poland, together with the National Fund for Environmental Protection, the General Directorate of Environmental Protection and the UN Environment Programme, we have launched the Brandbility programme that is focused on supporting Polish companies in environmentally responsible management of production and sales processes. The basic idea behind the Brandbility programme is that every product will eventually become a waste, and it will be a waste of a particular brand. Proper management and disposal of waste, especially when the product becomes a hazardous waste, is of crucial importance for every producer. Shopping centres have to think about the comfort and security, including legal security, of their tenants. Otherwise, they will soon disappear from the market and lose credibility. The Brandbility programme aims at ensuring appropriate rebranding and remodeling management that would guarantee the use of environmentally friendly procedures and materials, as well as the development and application of an efficient, consumer-oriented communication strategy. In case of dynamic marketing strategies, rebranding involves frequent changes which result in hundreds of tons of waste generated. The key to success is the ability to manage the rebranding process in an eco-friendly manner. Another challenge comes with the employment of the disabled and adaptation of the workplace to their needs. We have seen that disabled customers perceive facilities for the disabled in modern shopping centres as a norm. The question is, whether on the so called “backstage” everything looks the same. The data from PFRON (State Fund for the Rehabilitation of Handicapped People) shows that a growing number of shopping centres hire disabled employees. This trend is quite stable in Western Europe and other developed countries in the world. Consumers want to see the disabled as equal members of the society. The era of responsible consumption is coming. Starting in large cities, with the help of mainstream media, it will become fashionable and eventually impose standards that all shopping centres will have to follow. The question is, will the shopping malls outpace the trend and pursue these changes on their own, winning over the customers and, as a result, their loyalty? ☐
The return on investment in a country, a region or a particular development centre, i.e. the city where the investment would be carried out, is evaluated on the basis of statistical analysis of income spent on consumer goods and leisure time spent on shopping. According to the UN, this trend is becoming increasingly clear and will bring tangible benefits for the shopping centre market. First of all, the number of developed countries is increasing. Secondly, the global rural-urban migration tendency continues. Thirdly, as the level of affluence in developed countries increases, so does the amount of leisure time spent on various forms of consumption. All of this signals better economic outlook for the shopping centre market.
Growth trend in the shopping centre market
In 2013, the Central and Eastern European markets recorded the biggest growth in real estate development investments – over 2.4 million sq. m of retail space. Across Europe, 3.6 million sq m of retail space was commissioned in the second half of 2013, which clearly shows the rate of change and growth in the Central and Eastern European markets.1 The trend continued to burgeon in 2014. Since December 2014, over 200 new shopping centres have been developed in Europe, of which 127 are located in Central and Eastern Europe. The above tendency shows that the Western European retail market is saturated and is currently in the phase of intensive renovation and extension of existing facilities, resulting from increased competition, whereas the Eastern and Central European markets are far from saturated.
What does it mean for the UN?
In Western Europe, the increased competition between shopping centres and their fight for customers have led not only to cost optimization but also to increased awareness of responsible consumption, responsible investments, fair trade supply chains and labor rights. With increased competition and consumer awareness, shopping centres have started to expose and highlight specific elements of various brands image that attract customers. These activities can generate a lot of savings. For example, a shopping centre built using high-quality energy saving construction materials will not only have a chance to receive prestigious certifications but will also generate a lot of savings in the long term. Another example is proper waste management or disability employment. All over Central and Eastern Europe, the trend towards responsible consumption and responsible investing is quite clear. If the shopping centre market responds to that trend well, it will not only gain competitive advantage but also contribute to the improvement of the quality of life for all.
Kamil
WYSZKOWSKI
Competition in the shopping centre market
has been working for the UN for 13 years. He has been the National Representative of the United Nations Global Compact in Poland for 10 years, coordinating the UN cooperation with businesses, municipalities, universities and NGOs. For the last 4 years, he has been working as the Head of the UNDP Project Office in Poland. He is an expert on the UN and EU policies, in particular with regard to business and administration activities and the inclusion of the private sector in the implementation of the UN objectives and standards. As a lawyer, Kamil Wyszkowski specializes in international law.
To stand a chance against competitors, shopping centres need to spot and apply these trends well in advance. Today, many people already make buying decisions in compliance with the standards of responsible consumption. Developers should think about sustainability as early as during the construction phase. They should apply energy saving solutions and a good communication strategy based on transparent certification system and audits, 1
Cushman & Wakefield
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Q&A
THE ADDED VALUE TO
Photo: Imaginarium
the world of toys
In the magical world of the IMAGINARIUM stores even every adult will like a child. The unique atmosphere, fascinating toys and characteristic double entrance to the shop create a fairy-tale world, well known and recognizable already in 26 countries. Business success is born, when a company emerges from the passion and when founder puts into it not only his knowledge, but also his heart and experience Interview with FÉLIX TENA, CEO and funder Imaginarium
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SARAGOSSA SPAIN
Where did the idea for the name “Imaginarium” come from?
a context that connects with the need to play and learn that all children have. Two doors – one for adults and another for children – that lead to a unique place full of surprises for all who enter.
The name evokes imagination, which is something Imaginarium wants to awaken and encourage in children. When I was little one of my favourite things to do was to imagine adventures, and so with Imaginarium I wanted to bring those special moments from my childhood to all children.
How did it all begin?
For me Imaginarium is not a normal shop. It's more like a theatre.
Imaginarium came about with the goal of bringing added value to the world of toys. At that time what was available in the sector was a direct result of advertising pressure and the commercial interests of mass distribution. We thought that this was missing the most important point, which was that the essence of toys was to be with children through their childhood and to be a source of learning and emotional expression. So we began bucking the trend in November 1992 with a mission to contribute to the human development of children with creativity and fun. We worked with a group of collaborators to lay the foundations for what is today one of the most highly valued multinationals in the world of toys.
It’s true. The concept of Imaginarium shops, as I mentioned, is precisely that they are different. It is not enough to just be a toy store; it needs to go further. It has to be attractive and exciting for adults and kids alike. To achieve this, Imaginarium’s philosophy of helping to build a better world through play is conveyed in its shops. The company strives to offer a magical and unforgettable shopping experience for adults and for children, thereby establishing powerful bonds between families and the brand. Now with the Concept Stores, which are larger shops, the aim is that they are a meeting place for parents and children as well as a place for fun and information. Workshops and activities are frequently organised for parents and children.
Why did you choose the toy industry?
I have always been fascinated by the world of toys. As a child I loved to journey into imaginary worlds and fantasies with my toys. In fact, I got my start as an entrepreneur when I created a game during school holidays one year which I later marketed and sold, thus beginning my professional career in the world of toys. Of course I’ve joined forces with top international professionals from the childhood and design sectors. The key to Imaginarium’s toys is their design; this comes as a result of the efforts of more than 450 specialists including educators, psychologists and pedagogues whose vision imbues our toys with the brand’s twofold mission: learning through play.
www.facebook.com/Imaginarium, www.imaginarium.ie
The hallmark of your brand is the double entrance to the shop – with separate doors for adults and children. What does it symbolise?
Club Imaginarium came into existence in 1994.
Yes. Today, Imaginarium has 1.5 million members worldwide and is very proud to have created this great family throughout the world. There are many benefits of joining Club Imaginarium. You will receive notifications about the family events that Imaginarium organises, the kids will receive a birthday greeting and candle, there are discounts and special promotions, members receive preview editions of two catalogues each year, there is also a discount code to use during the Christmas season, receive useful information and tips about the stages of children’s growth, and more.
It is impossible to turn our backs on technology when children see us using mobile phones, computers and tablets every day
As I mentioned, more than 450 professionals pool their efforts to work on each collection of Imaginarium toys, in order to create toys that are not only very safe but that fulfil the educational mission as well. Attention is paid to every single detail because they are very important to us. Take our technological toys for example. Imaginarium works to make sure they are not just another toy, but that they have languages so that children can train their ears, or we create toys that kids assemble themselves to develop
The double door is the symbol of Imaginarium shops and came about when the concept for the shop was being created. A magical place where parents and children can find what they are looking for. For parents, a different offer that has been selected according to criteria based on educational and social values: pedagogical assessment, recommended age, educational and creative potential... And all this within easy reach in order for them to try and explore Imaginarium’s product range in
SHOPPING MALL EXPERT |
One of the important elements of your business is its educational mission. How do you fulfil it?
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Q&A
www.facebook.com/Imaginarium
their intellect and skill. The same goes for all Imaginarium products... and much work is required to achieve this.
They say inside every adult there’s still a child that lingers. Do you agree with this?
I completely agree. What’s more, we each have to care for our inner child in order to connect with kids. Our goal is for Imaginarium to spark the interest of both parents and children. On the one hand because it is important for parents to play and share time together, and on the other because Imaginarium toys have to persuade parents as well as their children.
Some toys remain dear to us throughout our lives. Do you remember what your favourite toy was when you were a child? My favourite toy as a child was a car but I loved to play at imagining adventures on the patterns of the Arabian carpet in my house.
These days traditional toys like teddy bears are being replaced by innovative and modern toys such as computer games, for instance. It’s a little sad...
These changes are part of the world in which we live. It is impossible to turn our backs on technology when children see us using mobile phones, computers and tablets every day. In fact, at Imaginarium technology is used to create toys. But we do work to make sure that children are using technology safely. It also depends on how much they use it. When used excessively, technology isolates people and prevents them from enjoying many other things in life. But in that area parents are also responsible for limiting the use of technological toys and games. Imaginarium has developed IWOW games for tablets so that children can learn things while they play with these devices. Another example of technology is the Paquitos line of tablets and the Paquito Mix phablet. Imaginarium has worked to include safety controls on them that are programmable by parents so that children have safe experiences online.
More than 450
professionals (educators, pedagogues, psychologists) work to create toys, that are not only very safe, but that fulfil the education mission as well
1.5 million
members has a Club Imaginarium worldwide
2 collections
per year are introduced by Imaginarium. Each of them has about 2000 products, of which ¼ are a completely new models
about 20%
of the company's annual budget is allocated to activity in the area of research and development www.facebook.com/Imaginarium
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They say that children are the most demanding customers. Do you agree?
Children know exactly what they want. At every age they have their preferences and we have to know how to find the toys that appeal to them and that are beneficial at the same time.
The countries in which Imaginarium is present are different on a cultural level, for instance. Do you see differences in consumer preferences in different parts of the world? Each country has its preferences for certain toys or types of games. For instance, in Germany they love wooden toys.
(...) we each have to care for our inner child in order to connect with kids
Due to the economic crisis many young people are having problems finding a job. What advice would you give to young people who want to succeed as you have?
Get the best education possible, have hope and don’t give up no matter how difficult things may seem in a given moment.
Through internship programs you are helping young people enter the labor market.
Today, Imaginarium is present in 26 countries around the world. In your opinion, which of these markets is the most demanding and which is the most profitable?
We have agreements with universities through which students do internships at Imaginarium. Some of them, 25% of the interns, stay on. In addition to their professional worth, their attitude is highly important because it ends up being reflected in their work. If they like their job, if they are engaged, it is much more likely that everything will work out well.
We manage it with a good team that shares our mission of doing a good job. Everybody has to get involved, regardless of their position in the company. I like to be present at all phases of developing a toy, and then I test it personally.
We always look at Imaginarium as a whole; each country has its own characteristics and we address all of them. For example, English-speaking markets such as Ireland or European ones such as Germany and the Netherlands are very competitive because there is a much wider toy offering and because parents aren’t quite as “generous” with their children as in other markets. In terms of profits, Spain is the most profitable. Shops are close, meaning there are less transport costs, and there are more sales per square metre thanks to the brand’s familiarity and reputation, making this the most profitable market.
Imaginarium is present on social media. How important are social networks for communicating with customers?
In the West multibrands are very popular. What do you think about this method of selling products for children?
Photo: Imaginarium
Running such a large brand is a big challenge.
Imaginarium places a great deal of importance on social media because it is a way for us to be in contact with our customers, to find out about their concerns and to share their joys. Currently we are on Twitter, Facebook and Pinterest. But we also have a web site and a blog where it is very easy to find complete information about not only the products in our collections but about the content we generate.
Multibrands have a global dimension, and a sales volume of each product in the millions of units, which are sold through third parties: all types of retailers. This volume and their global dimension allows them to create large advertising campaigns for creating demand among children through advertising on children’s TV or in films and other content. And it is a model that has always been the same and has worked very well. Our model is different. Imaginarium toys do not follow trends, popular film characters, etc., but instead contribute to children’s education and development through play during their first years of life. It is an argument that is more interesting to parents than children, who already feel spontaneously attracted to the double doors and the magic and fun the toys themselves hold.
about 95000 likes
What are your development plans for the coming year?
830 followers
We remain committed to toys and products that bring value, develop skills and promote hobbies. We will continue to offer a wide variety to satisfy any need and will also concentrate on products that younger children will like. We are also expanding to the Middle East… ☐
more than 7000 followers
Agnieszka Nejman
13.05.2015
SHOPPING MALL EXPERT |
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REPORT
BEST COUNTRIES FOR BUSINESS At the end of 2014, the World Bank published the Doing Business 2015 report in which they analysed the ease of doing business in 189 countries. Which countries enhance business activity and which constrain it and should therefore be avoided by new entrepreneurs?
T
The World Bank’s Doing Business report is published annually. The ranking includes the data from the previous year and a forecast for the following year. Doing Business analyses the current economic situation in 189 countries in terms of their attitude towards entrepreneurs and regulations affecting the life of a business. The position of a particular country on the list depends on the overall average score across 10 categories under assessment. The higher a country ranks, the easier it is to start and develop business in there. The results of the Doing Business report have significant influence on how a country is perceived by entrepreneurs who, on the basis of this very report, make decisions about their investment size and location.
What does Doing Business measure?
The Doing Business ranking analyses ten areas of business activity: ease of doing business, starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. In order to compare the business environment in different countries, a DTF (Distance to Frontier) indicator is used. When analysing the economy of a particular country, the indicator compares it with the economy of a hypothetical country that scored 100% in all areas under analysis, i.e. is the perfect place to run business.
Best and worst countries for business
This year, Singapore was ranked the highest, as the most business-friendly country in the world. New Zealand and Hong Kong ranked second and third, respectively. The top ten best
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countries for business also include Denmark, South Korea, Norway, Great Britain, the United States, Finland and Australia. The ranking closes with African countries: Chad, South Sudan, Central African Republic, Libya and Eritrea. Starting business activity in Venezuela, Libya or Afghanistan also does not look promising. Former USSR countries also ranked very low: Azerbaijan ranked 80th, Kyrgyzstan 102nd, Uzbekistan 141st, and Tajikistan 166th. In comparison with the last year’s report, the following countries advanced in the ranking the most: Tajikistan, Benin, Togo, Ivory Coast, Senegal, Trinidad and Tobago, Democratic Republic of Congo, Azerbaijan and the United Arab Emirates. The situation in Serbia, Iraq, Syria and Cameroon looks far worse – these countries recorded the biggest drops in comparison with the previous Doing Business ranking. The best European country for doing business is Denmark, which ranked 4th. The worst business climate in Europe is in Croatia and Cyprus, which ranked 65th and 64th, respectively. This year, the DTF indicator for Poland equalled 73.56% and with that result, Poland ranked 32nd on the list. By comparison, Singapore, which ranked first, scored 88.27%. Poland ranked below such European countries as France, Estonia, Lithuania or Latvia. Among Central Asian countries, Kazakhstan was classified the highest – 77th on the ranking.
least three categories under analysis. Business environment in Poland looks particularly promising in terms of credit availability (rank 17), liquidity proceedings (32) and property registration (39). However, the situation looks far worse when it comes to construction permits (137) and paying taxes (87). Starting economic activity is also not that easy in Poland which currently ranks 85th in this category. However, it is worth mentioning that in all of the areas in which the position of Poland is still far from good, the distance to the top players, i.e. Singapore, Hong Kong or Denmark, is decreasing. The improving business climate in Poland results from introducing various solutions facilitating the process of starting business activity and accelerating the process of obtaining the construction permits. Year by year, Poland is becoming more business-friendly which has a positive effect on its international image. ☐ Marta Wiśniewska
10
Over past
years
EASE OF DOING BUSINESS RANKING - TOP 20 RANK
ECONOMY
DTF SCORE
1
Singapore
88,27
2
New Zealand
86,91
3
Hong Kong SAR, China
84,97
4
Denmark
84,2
5
Korea, Rep.
83,4
6
Norway
82,4
7
United States
81,98
8
United Kingdom
80,96
9
Finland
80,83
10
Australia
80,66
11
Sweden
80,6
12
Iceland
80,27
13
Ireland
80,07
14
Germany
79,73
15
Georgia
79,46
16
Canada
79,09
17
Estonia
78,84
18
Malaysia
78,83
19
Taiwan, China
78,73
20
Switzerland
77,78
Economies with the most cumbersome business regulations have been gradually catching up by adopting some of the better practices seen among the best performers
enterpreneurs benefit
Polish business is improving
This year’s result for Poland is 0.2 pp higher than last year. The 2015 position of Poland in the Doing Business ranking is also the best to date for the country. The result is, without a doubt, a reflection of the improving business climate in Poland. In 2011, Poland ranked 70th out of 183 countries then under assessment. In comparison with the previous year, Poland advanced by 13 ranks. This success was possible due to improved score in the “getting electricity” category that assesses the efficiency of the process for obtaining a permanent connection to electricity distribution network by commercial entities in large urban areas. In this category, Poland advanced by 73 ranks, from 137th to 64th. Poland also belongs to a group of 21 countries that have made a significant progress in at
WORLD BANK GROUP
SHOPPING MALL EXPERT |
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Q&A
CHI VA PIANO, VA SANO E VA LONTANO
Whoever takes life in a relaxed and calm way, enjoys a healthier and longer life – that’s how you could translate the Italian motto of the well-known VAPIANO restaurant chain. The Vapiano restaurants are present in 29 countries all around the world, on five continents. The origin of the brand might be surprising, as this retail chain offering Italian food, such as carbonara or bolognese, comes not from Milan or Naples but Hamburg in Germany
Interview with STEFAN LINDENBERGER, Vapiano franchise owner in Poland
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HAMBURG GERMANY
Vapiano was founded in 2002. How could you describe beginnings of your company?
At Vapiano the principle of highest self-determination prevails. We want our guests to make decisions for themselves, i.e. when and where they sit, what they eat and when they change places. The chip card is intended to help them make their visit as individual as possible.
The basic idea was to open a restaurant offering the guest all the freedom he wishes for – as if he were cooking with good friends. Total freshness, transparency and design had and have top priority. With the first restaurant in Hamburg, the expression “emotional filling station” arose which made Vapiano into a place where people are important, feel good and communicate.
What, then, is the biggest asset of Vapiano? What does attract customers?
We can said that you find a niche in the market.
It’s true. With this idea for a restaurant, we founded a new category in the hospitality industry in 2002: fresh casual dining. Vapiano has remained loyal to this success recipe until today, but we, of course, still wish to surprise our guests again and again and continually develop Vapiano.
It’s a matter of fresh, delicious food; but it’s also a matter of the atmosphere – communication among guests. That’s why high-quality design is also important for Vapiano that Southern Tyrolean architect Mattheo Thun has developed. It is not always simple to conserve this holistic approach. We did have a considerable time of intensive discussions about freshness. And, ultimately, these are the factors that chiefly our young guests love above all.
When you opened your first restaurant, what were your expectations? Did you suppose that you will gain international success?
“Chi va piano, va sano e va lontano” – this Italian proverb is a main slogan of your company. Could you please explain what does it symbolize? Whoever takes life in a relaxed and calm way, enjoys a healthier and longer life. And this is exactly the feeling that is lived in our Vapianos every day – by our guests and our staff, the Vapianisti.
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In the first two years, we took plenty of time to hone our concept and mature it to obtain a sound basis for the following expansion. We were largely convinced that Vapiano would not be a fleeting concept, but a permanent lifestyle brand. When, at the end of 2004, the first franchise was opened in Düsseldorf, we were all the more interested to see if the Hamburg idea would be accepted in other regions. The next location in Frankfurt then confirmed all our thoughts: Vapiano is well accepted – also beyond the Hanseatic City.
o: ww w.v api ano .com /en/hom e
Last year Vapiano received a special award – Best Food & Beverage Retail Concept Mapic 2014. What is your recipe for success?
The concept’s secret of success is freshness – freshness in the ingredients, in preparation and in our thoughts. In each of every one of our Vapianos around the world, pasta, pizza dough and all sauces, dressings and dolci are homemade every day from lots of fresh and highquality ingredients, and in some cases in the middle of the guest area in the glass manifattura, whilst in the Show Kitchen dishes are cooked live before the eyes of our guests. This interactive front cooking concept allows Photo: www.facebook.com/Vapiano/photos the guest, when ordering, to tell the chef his wishes and preferences, ultimately giving him his quite personal favourite dish. Vapiano, for guests, means self-determination and individuality coupled with fair prices and a casual and Vapiano owners founded a new cosmopolitan atmosphere. There are no dress codes and it is category in the hospitality industry unnecessary to book a table – just as if you were eating with in 2002: fresh casual dining. In the good friends. The Vapiano staff, our so-called Vapianisti, play first two years, they took plenty another role apart from that with our guests. All Vapianisti of time to hone their concept and mature it to obtain a sound basis for have a high degree of communication skills, are open, tolerant the following expansion and see their daily work as a mission.
One of the characteristic element of Vapiano restaurants is RFID chip card system to pay for orders. SHOPPING MALL EXPERT |
Ph oto :w ww .vap iano. com/en/home
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Q&A
Vapiano in numbers
more than 150
How it is possible that German retail chain is worldwide well-known from Italian food?
units in the world
The globally popular Italian-based cuisine is interpreted as open to the world and exceptional at Vapiano. On top of this, each guest here has the opportunity to create his individual favourite dish.
29 countries on 5 continents
What in your opinion is the best form of promotion for restaurants? We rely on recommendation marketing, which means we can do without the classic advertising vehicles and we make our guests “recommenders”. Whereas others print posters and arrange radio commercials, we speak to our guests via Twitter, Instagram and Facebook and search continually for new ways for a direct dialogue. In this way, we record complaints, make bloggers happy at cooking events and we, ourselves, post photos on Facebook. Here, we don’t just say this, we are actually there and close to our customers: in direct proximity to our guests without disturbing them in their experiences.
To whom is the offer of Vapiano addressed?
Our guests do not have age or origin in common, but their quite personal attitude to life
Our guests do not have age or origin in common, but their quite personal attitude to life. They have a modern, flexible and demanding lifestyle. They enjoy and attach value to a healthy diet. But, primarily, they like to be in places where
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people like themselves are. And these people are everywhere – among students, tourists, professionals, parents or best agers.
Which dish from Vapiano restaurants could you especially recommend?
We would recommend the dish Pasta Salvia Piccante as it is an expression of the fresh and exceptional character of our cuisine and is not only an optical highlight but also a tasty one.
Nowadays are very popular various trends in food consumption such as vegetarianism, pescetarianism etc. Do you have a special offer also for this type of clients?
When many people first consider Italian cuisine, they firstly think of classics like pasta Bolognese, pasta carbonara or pizza salami – i.e. dishes which are neither vegetarian nor vegan. But Mediterranean cuisine of course also offers a large number of vegetarian delicacies – lots of fresh vegetables, light tomato sauces, crispy salads. A glance at our menu reveals that we have, from the outset, offered various tasty vegetarian dishes and even ones for vegans.
What type of localizations are interesting and attractive for you? Normally, we concentrate on cities with
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more than 100,000 inhabitants. Our motto: Vapiano restaurants belong at the heart of where things happen. That’s why they are always close to business and/or shopping locations and in spots where offices or residential areas can be found. Each location is exactly planned according to various criteria (demographic aspects, spending power, etc.) to guarantee high frequency at all times of the day.
Many young people can’t find work today. What is your advice to them? Experience in the hospitality industry is, of course, always an advantage. However, the priority for us is to recruit people who bring along the Vapianisti gene – openness, a pleasure in communication, tolerance and a positive attitude to life. Our guests and the Vapianisti are united by values. As Vapiano does, they appreciate quality and enjoyment with Mediterranean flair, coupled with an openness for the world, transparency, authenticity and a casual ambience.
What are the biggest challenges for restaurants today?
(...) the Vapianisti gene – openness, a pleasure in communication, tolerance and a positive attitude to life
Our greatest challenge and, at the same time, our philosophy is always to grow, but not to run too quickly and stumble. We want to take one step after the other and always offer our guests a taste experience. When the food, the atmosphere and ambience are well staged, Vapiano’s life is justified also in the long term. Only in this way can we convince our guests permanently that Vapiano is always the right choice. And to be successful the world over and, primarily, to successfully implement the expansion planned, we have to find the right people for vacant positions in our company.
What are the future plans of your company for the coming years?
As already mentioned, we wish to retain our speed of growth as far as possible. The goal of 250 restaurants still applies, even if we reach this a year later, i.e. in 2016. Basically, we are aiming to double the number of restaurants every 3 years. And we are continually developing our concept and offerings in order to surprise the guest again and again. ☐
Agnieszka Nejman
Photo: www.vapiano.com/en/about-us/our-design
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Q&A
At the very heart of West Berlin, right next to the famous zoological garden and vis-a-vis the Waldorf Astoria hotel and the historic Kaiser Wilhelm Memorial Church, there is a place that exemplifies unconventional architecture and unorthodox approach to commercialization. It’s the new BIKINI BERLIN CONCEPT MALL, where you can find not only unique brands but also a cinema, offices, recreational space and a hotel, all in spacious and modern lofts Interview with BERNHARD TAUBENBERGER, head of communication and strategic marketing Concept Mall Bikini Berlin
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Photo: Bikiniberlin.de
UNIQUE German MINIMALISM
BERLIN GERMANY
What is the story behind the name of this shopping center?
The name Bikini Berlin comes from “Bikinihaus” which is how Berliners affectionately called the building in the 1950s. Its double-skin façade, now fully glazed, reminded them of the bold swimwear fashion of that time, the bikini.
Originality is surely the first thing that comes to your mind when you visit the center. That was our goal. One of the greatest architectural attractions is the panoramic window with a spectacular view of the monkeys playing in the nearby zoo. At the center of a large, one-story hall you will find the Bikini Berlin Pool with nineteen centrally located wooden popup stores for short-term tenants. Around these “boxes”, behind the glass walls, you will find the shops of our permanent tenants. The second floor is the Bikini Berlin Gallery and the third is the Bikini Berlin Garden with the “Studio” project presenting modern, future-oriented concepts of innovative brands. It also serves as an exhibition and event center.
There are over 60 shopping malls in Berlin, almost every neighborhood has its own shopping center. Berlin Bikini was opened on 3 April 2014. During the first four days – the grand opening – it attracted 294,000 visitors. Bikini Berlin was well-received by both local customers, as well as tourists
The center opened only a couple of months ago. Are you satisfied with the number of visitors? The center opened on 3 April 2014. During the first four days – the grand opening – it attracted 294,000 visitors. Bikini Berlin is well-received by both local customers, as well as tourists. We do believe that tourists will constitute a large share of our clientèle in the future. The center is recognized by almost everyone in Berlin and is gaining popularity outside of Germany as well. We are still working on recognition. We want to make BB a tourist destination, so that the center would be visited by the tourists as often as the Memorial Church or the zoo.
What brands do you have in your portfolio?
concept 17,000 sq m mall 7,000 sq m Bikini Berlin 3,300 sq m
dedicated to fashion, lifestyle, beauty and restaurants
green terrace of center
area of Bikini Berlin Pool
Photo: Bikiniberlin.de
We have carefully selected fashion brands: Vans Zooper Store, Carhartt WIP, The North Face, Italian Hox or Labo. Art; electronics brands: Cyberport and Teufel Raumfeld; art, design & lifestyle brands: Swiss Vitra or Californian Art Center College of Design that collaborates with Berlin in the creation of innovative art and design projects in the center. You can also find interesting restaurants serving healthy, balanced food made with products from local suppliers, like Block House, or the 3-storey The Eats restaurant. BB Centre is also a good destination for beauty shopping: we have the Jacks beauty department with customized beauty consultations. From 10 November to 31 January, customers were designing their own sneakers as part of a special project organized by the Adidas brand in the BB Studio.
Photo: Bikiniberlin.de
What is your tenant selection strategy?
The tenant mix is extremely important for us. We already have the perfect offer. Right now, the commercialization rate equals roughly 90% of leased retail space. However, we never stop looking for new brands from beauty and children’s fashion or multibrand fashion stores with classic offer and a wide target group.
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Q&A
I assume this unique approach to retail requires equally original customer communication strategy.
During the development phase of the Bikini Berlin brand, we decided to create and market something of our own. We collaborated with famous designers and brands because we wanted the customers to know the brand even before the store was open. Right from the very beginning, we have been selling on Amazon.de, as well as via our own online shop.
Do you organize any events?
One of the greatest architectural attractions in Berlin Bikini is the panoramic window with a spectacular view of the monkeys playing in the nearby zoo. At the center of a large, one-story hall you will find the Bikini Berlin Pool with nineteen centrally located wooden pop-up stores for short-term tenants Photo: Bikiniberlin.de
Yes, every weekend. We organized the Wool Weekend during which you could watch wool installations and exhibitions, participate in workshops and a fashion show, or see a model posing on the terrace with Merinos. For dog lovers, we organized a weekend when you could buy stylish dog mats, bowls, collars, leashes and take a picture with your little pet friend. There’s a barista event every third Thursday of a month and brunch with jazz music on Saturdays. There is always a special play area for children with a supervisor. The center does not forget about the little ones. We organize various creative workshops for children at the Art Center College of Design.
How would you describe the German shopping center market?
Right now, there are over 60 shopping malls in Berlin. It is a big city with almost 3,5 million inhabitants. In Berlin, almost every neighborhood has its own shopping center. The competition is strong and retailers have no choice but to continue exploring new solutions. On one hand, it’s about giving the customers an alternative. On the other, we simply want to be successful as a shopping center. ☐
19 5 294 000 Wool week is one of the events organized in Berlin Bikini. Clients have the opportunity to watch wool installations and exhibitions, participate in workshops and a fashion show, or see a model posing on the terrace with Merinos Photo: Bikiniberlin.de
Agata Poturalska
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wooden pop-up stores for short-term tenants sizes of boxes to choose for tenants: 19, 24, 29, 34 and 39 sq m people visited shopping mall during the first four days of the grand opening
REPORT
SHOPPING CENTRE MARKET IN WESTERN EUROPE WWW.SHOPPINGMALLEXPERT.COM |
The economic crisis in 2008 in Western Europe has mainly affected Greece, Portugal and Ireland. However, it has also left its mark on much stronger economies, such as Germany, France and Great Britain. It was clearly visible on the shopping centre market, where prudence dominated the decision-making processes. The pace of development of new facilities in the countries most hit by the recession has slowed down significantly. Even the richest countries of Western Europe followed a more conservative approach, focusing on improving the existing shopping centres, rather than building new ones 38
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Economic situation in Western Europe
In the 3rd quarter of 2014, the GDP in Europe grew by 0.8%. The economy of Great Britain and Greece increased by 0.7% quarterly. The GDP of Germany and France also improved. These results show that Western Europe slowly recovers from the crisis. Only Cyprus and Italy recorded a drop in GDP in 2014. According to data released by Eurostat, in mid-2014, the highest unemployment rates hit Southern Europe – Greece (over 27%), Spain, Portugal and Italy. In Great Britain, Germany and France, the unemployment rate was roughly similar to the EU average (10%) or lower. In the 3rd quarter of 2014, the total value of investment transactions increased by 16%, to EUR 12.5 billion. Strong Western European countries, such as Great Britain, France and Germany, contributed the most with EUR 7.75 billion in transactions, which equalled 69% of the total value of investments in the region. The economic situation and employment rates had influence on the investments in the development of new shopping centres or redevelopment of the existing ones.
GLA (SQ M) PER 1000 INHABITANTS
Norway
650
Luxembourg
600
Sweden
410
Finland
400
Netherlands
395
Ireland
395
Switzerland
380
Denmark
320
Portugal
230
Great Britain
225
France
225
Spain
220
Italy
210
Malta
190
Germany
190
Belgium
110
Greece
50
Investing in extensions
Development activity in Western Europe focuses mainly on large exclusive shopping centres. The significance of supra-regional facilities is growing.Redevelopment and modernisations result from the need to improve the quality of the malls, as well as to extend their entertainment and cultural offer. The trend is clearly visible in France, where the investments focus mainly on the development of small and medium shopping centres*. Smaller Western European markets develop slower. It results, among other things, from spatial development constraints
*Cushman & Wakefield, April 2015
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COUNTRY
THE AVERAGE RENT (EURO/SQ M/YEAR)
THE AVERAGE CAPITALIZATION RATE (%)
Belgium
940
6,44
Denmark
643
6
Finland
1050
5,38
France
1263
5,5
Germany
548
5,08
Ireland
1800
8
Italy
639
8
Luxembourg
1050
5,63
Netherlands
433
6,75
Norway
865
5,79
Portugal
610
8,43
Spain
627
7,06
Sweden
740
5,13
Great Britain
1555
5
źródło: Cushman&Wakefield (April 2014)
RENT AND CAPITALISATION RATES IN WESTERN EUROPE (APRIL 2014)
Size of the shopping centre market in Western Europe
In the second half of 2014, the total area of retail space in Western Europe equalled roughly 107 million sq m. In this region, France takes the lead with 17,6 million sq m of retail space. However, the country that has recently become the leader of the European retail market is Russia, with 17,7 million sq m of retail space. England ranks third (second in Western Europe), with almost 17 million sq m of built retail space. France ranks first also with regard to planned developments. By the end of 2016, over 1 million sq m of retail space will have been constructed in this country. It equals 38% of the total area of European shopping centres under construction.
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COUNTRY
źródło: Cushman&Wakefield (April 2014)
Photo: Fotolia.pl/ Photocreo Bednarek
SATURATION OF THE SHOPPING CENTRE MARKET IN WESTERN EUROPE (APRIL 2014)
REPORT
france italy
127 551 135 000
great britain germany netherlands sweden finland spain
317 250 213 440 309 720 73 441 1 091 174
SHOPPING CENTERS UNDER CONSTRUCTION IN THE YEARS 2015-2016 (IN SQ M)
694 036 105 972
belgium Cushman&Wakefield (April 2015)
The countries that invest the most in the development of shopping centres and have the highest sales profits, i.e. Great Britain and France, rank close to the European average, whereas in Germany, the rate equals roughly 200 sq m per 1000 inhabitants. Among Western European countries, Greece ranks at the bottom with roughly 50 sq m of retail space per 1000 inhabitants.
and slower pace of recovery. That is why in Portugal, still struggling with the recession, shopping centre extensions will be carried out on a much smaller scale than in France. The Greek shopping centre market is still stagnating. The total area of shopping centres in this country does not exceed 606,000 sq m and no new investments are planned for the upcoming months. Spain is definitely the country that stands out in Southwestern Europe. It is one of the most popular European markets and continues its fast growth of investments that only last year increased by 264% in comparison with previous years and reached EUR 1 billion. In 2015-2016, the total area of roughly 106,000 sq m of retail space will be developed in Spain. The investors are increasingly willing to take risk and search opportunities outside stable markets.
Rent and capitalisation rates
According to research conducted by Savills, in 2013 and 2014 the investment activity in Europe was fuelled by private investors looking for low-risk products on the English, French, German and Scandinavian markets. In case of facilities located in shopping centres, the capitalisation rate on these markets remained at approx. 5%. In 2014, the British shopping centre tenants paid the highest rent in Europe, EUR 1555 per sq m per year. France ranked second with the rent for 1 sq m per year equal to EUR 1263. German tenants paid EUR 548 per 1 sq m per year. In Italy, the capitalisation rate amounted to 8% and average rent equalled EUR 629 per 1 sq m per year. ☐
Saturation of the shopping centre market
According to the data from 2013, there are on average approx. 230 sq m of gross retail space per 1000 inhabitants in Europe. The most saturated market in this regard is Norway, with the rate of 650 sq m per 1000 inhabitants. Luxembourg ranks second (570 sq m) and Sweden third (410 sq m). These are pretty small and economically developed countries.
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Magdalena Nowocin
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CENTE G N I P R P O THE
PALM ISLANDS
www.rsp.com.sg
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ON
SH
Q&A
PALM ISLANDS EMIRATES
Dubai is the world capital of shopping malls. Huge, unique and famous buildings are the hallmarks of this city. But they are wrong those who think that on the Mall of the Emirates, Dubai Mall and Deira City Center investors stop there. Nakheel is currently preparing 8 new retail projects. Among them the unique and amazing NAKHEEL MALL, located on one of the Palm Islands Interview with OMAR KHOORY, Director Nakheel Retail
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Q&A
Nakheel is a worldwide well-known real estate developer, which has in his portfolio innovative and interesting projects. Today one of the most important investments is Nakheel Mall. What will be the biggest asset of this unique shopping center? Nakheel Mall is situated in an unrivalled location, right at the heart of Palm Jumeirah, one of the world’s most famous landmarks. The mall will feature amazing views of the Arabian Gulf, The Palm and Dubai’s skyline while offering a diverse mix of shopping, dining and entertainment. Nakheel Mall will be on the doorstep of more than 30,000 residents who currently live on Palm Jumeirah, and will offer a new destination for the wider community of Dubai and the millions of tourists who visit the Emirate each year. Nakheel Mall will also be directly linked to The Palm Tower, Nakheel’s new, 50-storey building being constructed on Palm Jumeirah. The mall is anticipated to open in 2017.
The new shopping center will be well connected with different parts of the island.
It’s true. Nakheel Mall will be easily accessible by public transport, too. It is situated right on The Palm Monorail, Palm Jumeirah’s own light railway system, which in turn is linked to the Dubai Tram and The Dubai Metro.
What was your inspiration to create this project?
A large, destination mall was always part of Nakheel’s vision for Palm Jumeirah. Nakheel has engaged world class architects and consultants to work with its own design and development team to bring this unique project to fruition.
Because of its size, Nakheel Mall will provide a very comprehensive shopping and entertainment offer.
Have you started already commercialization process? What type of international and regional brands can be found among the tenants of Nakheel Mall?
Nakheel Mall will have 4,5 million square feet in size (about 420,000 sq m). Enough to house 40 international football pitches. In it: over 1 million sq ft of retail space, spread over five levels, 4,000 parking spaces, 350 shops and 15-screen cinema. The size of supermarket is 45,000 sq ft.
Nakheel has already signed a number of well-known brands, including hi-end British supermarket chain Waitrose and Vox Cinemas, the Middle East’s leading cinema and entertainment destination. Other famous names will be announced shortly, when contracts are complete. Some 50% of the retail space at Nakheel Mall is reserved, with ongoing interest from international and local retailers and services.
How do you think – how many customers and tourists will visit your centre yearly?
Palm Jumeirah is currently home to 30,000 residents, for whom Nakheel Mall will provide convenient shopping, dining and entertainment. This figure is due to rise to 60,000 over the next three years. In addition, millions of tourists who stay at Palm Jumeirah’s hotels each year will be able to visit Nakheel Mall without leaving the island. Nakheel Mall will also become a new destination for residents of Dubai and the UAE. We are expecting an average footfall of 70,000 per day at Nakheel Mall.
Dubai city because of its amazing shopping centres is considered as a best destination for shopping on the world. What is the perspective of the development of retail industry in your region in the coming years?
Dubai is a world-leading destination for shopping, and retail is key to Nakheel’s future business strategy. We currently have eight new large-scale retail projects underway at various locations in Dubai, including Nakheel Mall, Deira Islands Mall, Al Khail Avenue, The Circle Mall and The Pointe at Palm Jumeirah, as well as major extension to our two existing malls – Dragon Mart and Ibn Battuta. Nakheel also has several neighbourhood retail projects at various communities in Dubai. Over the next few years, our retail project portfolio will amount to more than 10,000 million square feet.
Can we say that Nakheel Mall will be something more than just shopping?
Definitely. Nakheel Mall will provide an unrivalled mix of luxury and household name brands including a Waitrose supermarket, department stores and every day services. But it is more than just a shopping mall: Nakheel Mall is a destination for dining, entertainment and leisure, with direct links to The Palm Tower, Nakheel’s new, 50 storey hotel and residential building on Palm Jumeirah, as well as a number of other residential complexes in the surrounding area.
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In Europe shopping centres are losing ground to the increasing influence of online retail. And how does it look like in Emirates? 44
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www.rsp.com.sg
Nakheel Mall
A new destination for shopping, dining and relaxed entertainment Nakheel Mall will be a focal point for the many residences, offices and hotels on The Palm Jumeirah and Dubai city as a whole. Palm Jumeirah is currently home to 30,000 residents. This figure is due to rise to 60,000 over the next three years
www.rsp.com.sg
sq m GBA sq m GLA shops shops parking spaces cinema expecting an average footfall (per day) opening date
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420,000 about 100,000 350 5 levels 4,000 15-screen 70,000 2017 about
Q&A
www.rsp.com.sg
Nakheel Mall has been designed around architectural representations of water that reflect its location at the heart of Palm Jumeirah and will include a variety of indoor and outdoor features that echo nature. It will house a variety of essential community stores and public amenities, as well as a state-ofthe-art gym and fitness centre, a multi-screen cinema and a other entertaining attractions Photo: N akheel Mall
Shopping is already a large part of the culture here in Dubai, and the Emirate is already firmly established as a worldclass venue for retail, with annual events such as the Dubai Shopping Festival and Dubai Summer Surprises attracting millions of shoppers from Dubai, the UAE and across the world. However, malls here are more than just shops – they are ‘experiences’. People visit malls for entertainment, dining and days/evenings out: these experiences cannot be purchased online.
Shopping is already a large part of the culture in Dubai, and the Emirate is already firmly established as a world-class venue for retail, with annual events such as the Dubai Shopping Festival and Dubai Summer Surprises
What are the biggest challenges a shopping centres face today?
Mall visitors’ expectations get higher and higher, so creativity and diversity are key to a mall’s success. Shoppers continually want to see new experiences, entertainment and facilities on offer.
What are the future plans of your company? How Nakheel can still surprise retail industry?
Photo: Nakheel Mall
Nakheel continues to play a major role in Dubai’s growth, and we are developing a number of new projects – in the tourism, retail and hospitality sectors in line with the Government of Dubai’s vision for 2020. Our profits in 2014 reached a record AED 3.6 billion, and we are looking to maintain the same pace, at least, of growth in 2015 as we saw last year. We will continue to build on the success of 2014 by releasing more units for lease, both on the residential and retail side. Our aim is to reach AED7.5 billion in recurrent rental income – via a portfolio of 10 million square feet of retail space and 30,000 residential units – in around three years. In addition, Nakheel expects to award around AED 7 billion worth of construction contracts in 2015. Projects include Deira Islands Mall, The Circle Mall and Al Khail Avenue at Jumeirah Village, The Palm Tower, Ibn Battuta expansion and several other residential, retail projects and hospitality projects across Dubai. Construction on Nakheel Mall, our new destination project on Palm Jumeirah, is already underway. ☐ Agnieszka Nejman
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#em_retail 19 october 2015 istanbul, turkey organised by
media partner
www.boc-uk.com | +44 207 112 4846 | events@boc-uk.com
FEUILLETON
in
In agriculture, there are a lot of for-profit intermediaries between the producer and the end consumer. The difference between the price quoted by the producer and the costs incurred by the consumers is growing. There is a tendency for large, dominant multibrand companies and suppliers – the intermediaries – to grow even stronger. The division of profits is disproportionate, with major suppliers getting the biggest share. The problem is huge. Roughly 2.5 billion people, 500 million small farms and 450 million employees make a living from agriculture.
Global South – the current situation
BUT ALSO PRODUCER-ORIENTED ECONOMY
Never before has the catchphrase “the rich get richer and the poor get poorer” been more accurate than in the 21st century. Yet it does not have to be this way. The consumer awareness level in developed countries gradually increases and there is a growing number of activists and NGOs supporting marginalized producers from Third World countries
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Growing dissent
In recent decades, the alter-globalization movement has been gaining popularity. As a result, more and more brands and chain stores offer products carrying special marks informing about the production conditions, addressing the growing demand for such products. Fair Trade (FT) is a social movement that dates back to the mid-20th century. – Fair trade can be defined as a form of development aid for small producers and employees from the Global South, provided by NGOs
Photo: Fotolia.pl/ Mariusz Prusaczyk
NOT JUST CONSUMER-ORIENTED
Most small producers live in the so called poor South. Trade liberalization and concentration are two reasons why the economic position of small producers is so difficult today. Dominant companies very often use price pressure to force the farmers to sell their crops at unfairly low prices or even at prices below the costs of production. As a result, many of these people live below the poverty line. – Globalization has increased social inequality, both globally and regionally, and has led to the degradation of natural environment – says business ethics specialist Barbara Pogonowska. Child labor is of particular concern. Children are often forced to give up education. Working conditions are very hard. For example, children working on sugar cane plantations are exposed to lacerations and amputation injuries, as the plants are mostly cut manually, using machetes. Inappropriate agricultural practices also affect natural environment. First of all, a farmer forced to cut costs has to replace expensive ecological solutions with cheap pesticides that are harmful to the environment. Secondly, in order to increase the crop area, forests have to be cut down. Thirdly, there are reasons to believe agricultural activity affects global climate change. It turns out that 30% of the global CO2 emissions comes from agriculture which additionally consumes over 70% of the planet’s accessible freshwater.
roughly 2.5 billion
and private companies with the help of consumers – says Tadeusz Makulski, member of the Polish Fair Trade Association “The Third World and Us”. – According to the idea of fair trade, people should care more about human rights, natural environment and sustainable development of local communities than about profits – he adds. Fair trade transactions are carried out in compliance with specific standards, such as minimum price for farmers, bonus payments for development investments, long-term contracts, promotion of ecological practices, prohibition of slavery and child labor. The fair trade movement is an example of great initiatives for poor Third World countries, as is Rainforest Alliance or Trustea. Regardless of the name or area of interest, all of these organizations aim at reducing the disparities, social inequality, and environment degradation. – They want to modify the norms and standards governing today’s trade so that they would foster sustainable development – says professor Pogonowska.
people, 500 million small farms and 450 million employees make a living from agriculture
roughly 90% of consumers in Great Britain recognized the fairtrade certification mark
30%
of the global CO2 emissions comes from agriculture which additionally consumes over 70% of the planet’s accessible freshwater
Active role of consumers
These organizations always emphasize that regular, everyday consumer decisions do matter. – Regular consumers can help marginalized producers by taking the right, i.e. socially responsible, buying decisions, increasing the demand for certain products carrying a specific mark and not buying or even boycotting certain other products that have not been produced in compliance with the fair trade standards, e.g. involved violation of human rights or degradation of natural environment – confirms the business ethics specialist. Yet some people may have doubts. “Why should we even care about someone who lives thousands of miles away from us and whom we will never meet?,” they might ask. – Buyers from the North should think about their buying choices. They are partially responsible for the difficult situation of the Third World producers and should be aware of that. They should show empathy and human solidarity, remembering about the colonial past of these countries – explains professor Pogonowska. Naturally, consumers also get something in return for supporting sustainable consumption. It is high quality, healthy products with natural flavor, not sprayed with harmful pesticides. That is not all. – Conscious consumers believe they are changing the world into a better place – says professor Pogonowska.
category, although the availability of fairtrade articles in stores such as Alma, Piotr i Paweł, Leclerc or Tesco, is growing – he says. In terms of marketing, companies could definitely benefit from the potential to create positive brand image using these marks and labels. One such example would be the McDonald’s restaurants serving the Rainforest Alliance coffee.
Consumer approach
It turns out that many people associate these various marks and certificates with something good but they do not know the exact meaning of them. – In the beginning, consumers simply believe that they should buy these products because they heard something about them or saw their friends buying them. It becomes a trend. Only later do they actually find out what it is about – explains professor Pogonowska. People who are more or less familiar with the idea of sustainable consumption can usually identify the key goals of the fair trade movement. – According to the survey conducted in 2014 by the Institute for Market, Consumption and Business Cycles Research, fair trade is mostly associated with respect for other people, their dignity, rights and needs (31%), care for the consumers (28%), as well as with people-to-people business activity (23%) and protection of natural environment (22%) – says Tadeusz Makulski. Buying ethical products is a way of showing solidarity with poor people from developing countries. In developed countries, shopping is part of everyday life. By paying attention and making good everyday choices, we can contribute to children’s education, medical care for elderly, installation of electricity system in a village, and give these people a chance to have a decent life and to make a living from their own work.
It’s time for action
The situation in Western countries is quite optimistic. – In Great Britain, the fairtrade certification mark is recognized by roughly 90% of consumers. Stable growth in sales of FT products is accompanied by various social campaigns promoting the idea, for example the Fair Trade Towns campaign. In March 2014, the campaign reached over 1600 cities from 24 countries all around the world (...) – says Tadeusz Makulski.
Working with, not against, chain stores
The activity of fair trade organizations is focused on increasing awareness of both consumers and companies. As a result, the activists began to cooperate with chain stores on joint projects. – It’s a new trend. Large chain stores do not yet recognize the demand potential of such products or treat them as unnecessary competition – says professor Pogonowska. Tadeusz Makulski agrees with her. – We don’t have many examples of such cooperation. Fair trade products are regularly available at Marks & Spencer, Starbucks, Stop Cafe-Orlen. Other chain stores do not display FT products as a separate
SHOPPING MALL EXPERT |
Anna Chwałczyńska
Article prepared on the basis of the report “Who’s Got the Power? Tackling Imbalances in Agricultural Supply Chains, 2014”
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Q&A
Fot. Punta Carretas Shopping
A N IMPR SONED SHOPPING CENTER Interview with JULIO DURLACHER, commercial director of Punta Carretas Shopping
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An interesting idea, a good concept and great location are the key to success for every shopping center. What is more, an attractive facility doesn’t have to be built from scratch – sometimes all you have to do is to restore and modernize old, ruined buildings. The best example is PUNTA CARRETAS SHOPPING in Uruguay
MONTEVIDEO URUGUAY
Its characteristic architecture surely must play a role in attracting visitors.
The building of Punta Carretas Shopping has existed since the beginning of the 19th century but was transformed into a shopping center almost a hundred years later, in 1994. What was it before?
The building was “recycled” by an Argentinian architect, Juan Carlos López (the designer behind Galerías Pacífico, Patio Bullrich and Parque Arauco) and an architect from Uruguay, Casildo Rodríguez. The building was constructed of stone and brick. There are 200 premises, four escalators and three regular stairs. We have preserved the most important architectural elements that come from the times when the building served as a prison – the arc and the façade.
The building of Punta Carretas Shopping exists since 1910. First it served as a prison. Almost 100 years later it was renovated and transformed into a shopping center. Today it is one of the most popular shopping malls in Uruguay
Fot. www.eyeonuruguay.blogspot.com
The history of our shopping center is very interesting. From 1910 to the late 1980s, the building served as a prison. For decades, the prison and a nearby church were the most important buildings in the neighborhood. In 1971, turbulent times for the country, there was a great escape from the prison and over 100 prisoners fled the facility. In 1986, after the riots had calmed down, the building was emptied and remained that way for a couple of years, until 1992. Then, the property was subject to a recycling of sorts and renovated. It was later transformed into a shopping center. The old prison, now a shopping mall, was opened again in 1994. It has had a great impact on the neighborhood. The area, once rejected by the society (to the extent some streets were closed to traffic for many years), has become an important shopping and entertainment center, attracting not only local residents but also tourists.
The story behind this building is indeed extraordinary but you must have faced many difficulties when transforming it into a shopping center. The biggest challenge was to preserve its unique history. We wanted to adapt the historic building, that used to be a prison, so that it would satisfy the needs of a modern shopping center. On one hand, we wanted to pay tribute to its unique architecture. On the other, we were trying to meet the expectations of the Montevideo residents in terms of the brands and services available at the mall.
Anything else?
Another challenge was to introduce a modern shopping center, to be visited by millions (and many coming with their own vehicles), to a calm neighborhood that was theretofore perceived as a mainly residential area. We succeeded without causing any greater problems for the residents thanks to the advanced traffic studies we had been conducting from the end of 1990s. Our research aimed primarily at the reconstruction of the traffic system and introduction of necessary changes. Today, we can say with great satisfaction that Punta Carretas Shopping is a nice and respected neighbor in its impact area.
sq m. GBA
100,000 42,000 42,000 15 mln
sq m. GLA
sq m. area of car parks
clients per year
SHOPPING MALL EXPERT |
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2,500 700 10 220
sq m of food court
seats for visitors in food court
cinema halls shops
Q&A
Its uniqueness, both in terms of external structure of the building and interior design. What is more, the center was developed with respect to the environment, is extremely spacious, and features a 200-meter-long glass ceiling that provides natural light for the facility.
I’m sure Punta Carretas must attract customers not only from Uruguay but from all over the world.
Photo: facebook. com/puntacarretas
What is the biggest asset of this center, in your opinion?
Lumina competition is one of the most interesting initiatives organized by Punta Carretas Shopping. The winners travel to Europe where they take part in major fashion events on the old continent. Today it is the most important competition for young designers in Uruguay
Fot. Punta Carretas Shopping
How many people visit the center each year? 15 million.
Could you give some examples of interesting events organized at Punta Carretas Shopping?
One of the interesting initiatives organized by Punta Carretas Shopping is the Lumina competition. It is the most important competition for young designers that has become a part of the curriculum of almost every design school in the country. The winners travel to Europe where they take part in major fashion events on the old continent.
Punta Carretas Shopping did not stop at having its own website but is also active on many different social media platforms. It’s true. Social media have fundamental value for
The most frequent customer of Punta Carretas Shopping is a woman between 20-44 years, from middle and high socioeconomic class
52% 31% 24% 25% 12% 7%
48%
Once a month Twice a month Once or twice a week 3 to 6 times a week Daily
FREQUENCY OF
men↑
↓women
VISITS
19% 26% 39% 9% 6%
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Once a month Twice a month Once or twice a week 3 to 6 times a week Daily
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Photo: facebook. com/puntacarretas
Punta Carretas Shopping is, without any doubt, the favorite shopping location of foreign tourists visiting our country. It probably has a lot to do with our unique brand and tenant mix. Over 90% of brands that decide to start business activity in Uruguay, choose Punta Carretas Shopping for their market debut. Thanks to that, we now have interesting restaurants, a multiplex cinema with ten screens and a rich service offer. That is why Punta Carretas Shopping has become the point of reference for other local and regional shopping centers.
us. It is a great tool for communication with customers, as it facilitates direct contact. We are present on almost all social media platforms and our Facebook page alone has over 300 thousand followers.
In your opinion, what is the future of the shopping center market?
Our biggest challenge will still be the same: exploring new forms and opportunities to meet the everincreasing demands of consumers. A good commercial offer is not enough. We have to mix the products and services well in order to meet the various needs of customers – social, cultural, recreational, etc. In everything we do, we should always think about the client, his family, community and natural environment. ☐ Agnieszka Nejman
| JUNE 2015
2nd Annual Future Retail Strategies 9th-10th September 2015, Congress 2015 London, UK
Registration is now OPEN for the 2nd annual Conlumino Future Retail Strategies Congress! Arena International is excited to announce that following the successful launch of the Conlumino Future Retail Strategies Congress in 2014, the event will be returning to London this September. Registration is now open for you to secure you place to hear from industry leaders on how retailers can better harness innovative technologies in order to provide a seamless, consistent, personalised customer experience – the biggest issue to all retailers. This event will bring retailers from across the UK to learn from the leaders in retail, to provide an exclusive opportunity for key decision makers in retail to keep up to date, be inspired and benchmark their strategies. KEY TOPICS ON THE 2015 AGENDA INCLUDE:
Future of retail – Achieving the holy grail of
a customer-centric, omnichannel view
Yes omnichannel is here, but how do you
ensure brand consistency across all channels?
Case Study: PetPyjamas Customer Service
Beacons – new fad or here to stay?
Panel: Reaching a tipping point for
payments – is the future cashless?
HIGH PROFILE SPEAKERS INCLUDE:
Jon Owen – Retail brands director, SHOP DIRECT
Julian Baker – Cross Channel Marketing Director, WHITE STUFF
Gracia Amico – CEO, PETPYJAMAS
Sarah Baillie – Head of multichannel business development, HOUSE OF FRASER
Kester Dobson – Head of Technology, HARRIS+HOOLE
Visit our website and book your place today using reference code MK-SRAD http://www.arena-international.com/futureretail To find out more please contact: events@arena-international.com
ANALYSIS
Photo: Fotolia/ Kadmy
POLAND CONQUERS INTERNATIONAL MARKETS WWW.SHOPPINGMALLEXPERT.COM |
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The position of Polish brands on international markets is growing strong. Many Polish companies have already decided to enter foreign markets, including the biggest Polish fashion company, LPP S.A. The growing popularity of Polish products all over Europe shows that “Made in Poland” has become synonymous with highquality, coveted goods
95% of the Inglot cosmetics is still manufactured in Przemyśl in Poland
82 Customers turn to local brands
stores has Atlantic only in Russia
Not everyone walking through a shopping centre in Poland knows how many of the brands are local. Atlantic and Esotiq lingerie. CCC and Gino Rossi shoes. Computer equipment from Komputronik. The list goes on: Coccodrillo, Top Secret, Mohito, Cropp, Sinsay, House, Reserved, and many more. All of these foreign-sounding brands started their business activity in Poland and are now conquering international markets.
32 stores has opened so far Gino Rossi abroad
Polish products not only for Poles
One of the Polish brands that has expanded their business activity abroad, is Gino Rossi, a Polish shoe manufacturer from the city of Słupsk. At the end of 2014, two Gino Rossi stores were opened in the Czech shopping malls. For 2015, another three openings are planned in the Czech capital. So far, Gino Rossi has opened 32 stores abroad, including one in Vilnius, three in Saint Petersburg, four in Riga and one in Hanoi, Vietnam. Another Polish brand that is gaining international recognition is By Dziubeka, a jewellery brand owned and created by Anna Dziubek. Anna Dziubek started her world expansion with opening a store in the Mongolia’s capital, Ulan Bator. After the success of the brand on that market, the brand opened its first store in the capital city of Azerbaijan, Baku, on 7 March. Apart from these two locations, By Dziubeka products are also available in the Atrium Optima shopping centre in Košice, Slovakia. A brand that turned out to be particularly successful on the Eastern markets was Atlantic, a Polish lingerie manufacturer. The company has started their business activity 22 years ago and now operates in 16 countries. The two biggest markets for the Atlantic brand is Russia and Ukraine, where the first products appeared in 1996. It is estimated that as much as 60% of the company’s revenues come from these markets. Only in Russia, the chain has 82 stores. In total, Atlantic has over 200 stores, both in Poland and abroad.
stores have been opened there. A year later, the Reserved brand entered the Egypt and Qatar markets and after a few months, a store in Kuwait was opened, in the Marina Plaza shopping centre. LPP S.A. plans to open another eight stores by the end of 2015, including one in Saudi Arabia. The stores in Cairo and Qatar brought the company another 2600 sq m of retail space. LPP does not focus on just the flagship brand. Other LPP brands are also present on international markets, with new stores underway. The expansion of the Mohito brand on the Eastern markets started in July 2014, when the first store was opened in Romania. A few months later, all of the LPP brands launched their stores in the Croatia capital city, Zagreb. In 2014, 1516 LPP chain stores existed, 196 more than in the previous year. In 2016, the company is planning to launch yet another brand that will further strengthen the position of LPP on the market.
Plans for the future
The international expansion of Polish brands shows that our local manufacturers are not only ready to develop their companies but also want to be successful on foreign markets. They are ready to introduce the necessary changes and adjust their products and solutions to the needs of international customers. LPP announced that the lines for the Middle Eastern markets will be designed with respect for the cultural norms applicable in these countries, e.g. by avoiding religious symbols. Polish companies are quite often successful not only in Europe or Asia but also across the Atlantic. One of the greatest examples is Inglot, a make-up brand that has built its international recognition on experience and top quality products. In many countries, such as Ireland, the brand dominates the market against local competition, even though 95% of the Inglot cosmetics is still manufactured in Przemyśl, in the Subcarpathian Voivodeship. Retail chains launching their brands in Germany are well aware that most of their stores will not be located in shopping centres, as they are far less popular than in Poland. The markets of the neighbouring Czech Republic and Slovakia also seem to be a good starting point for international expansion. Their cultural and economic proximity eases the process of adaptation, making these markets less risky and allowing Polish companies to grow fast.☐
LPP takes the world by storm
The Polish company that has achieved by far the greatest success on international markets is LPP S.A., a Polish fashion company with its seat in Gdańsk. The company was created in 1991 under the business name Mistral sp. z o.o. In 1995 it was transformed into LPP S.A. and 2 years later opened the first store of their flagship brand, Reserved. Their international expansion started in 2002, when Reserved entered the markets of Estonia, the Czech Republic, Russia, Hungary and Latvia. Since then, the brand has been constantly growing. LPP S.A., with its five brands – Reserved, Cropp, House, Mohito and the youngest one, Sinsay, enters not only the European but also Asian and African markets. In 2014, the Reserved brand was launched in Germany. So far, four
SHOPPING MALL EXPERT |
Klaudia Stanecka
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Q&A
from
BARRACKS to a SHOPPING MALL
Fot. Matúš Tóth dla Palladium Magazine
PALLADIUM is more than just a shopping mall in the center of Prague. It’s where the past meets with the present. The history of old barracks in a way saved the shopping center from becoming yet another regular mall in the Czech capital. Respect for old times and the managers’ love of art was all it took to attract the consumers and make them come to the mall not just for shopping but also for a wide spectrum of aesthetic experience
Interview with KAROLÍNA PETERKOVÁ, Marketing Manager of Palladium at Property Solution s.r.o.
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PRAGUE CZECH REPUBLIC
What is it that makes Palladium stand out in comparison to other malls in Prague?
Has the history of the building been used to promote Palladium?
What does “Palladium” mean?
Were there any challenges or difficulties while the building was being converted into a mall?
Palladium is certainly one of the best if not the best performing shopping centre in Prague. It was opened in 2007 and welcomes increasing number of customers each year, which is unfortunately not true for many other shopping malls in the Czech Republic. It is the largest one-stop shopping destination in the centre of Prague, offering more than 200 shops, cafés and restaurants on 5 floors. A great advantage is its location at a public transport hub (with metro, trams, buses, even 2 train stations in the vicinity) which is, nonetheless, in the historic centre of Prague. Therefore it is visited not only by Prague´s citizens but about 20 – 30% of its visitors are tourists. Palladium’s positioning is as a trendsetting shopping mall with a focus on fashion shopping. For those reasons many brands have decided to place their flagship stores in Palladium.
Thanks to the construction of Palladium, the rich architectural heritage of the site was disclosed to professionals and the public. When the construction started many archaeological findings were disclosed. Archaeologists were working on the site for almost 3 years and there were several excavations incorporated into the new building, so as to be visible for customers and to remind them of the long history of this site. Part of the interior includes three major archaeological findings. The centre also exhibits some other significant findings in special showcases. It also uses stone troughs which were discovered in the former riding hall as a part of the fountain sculpture in the office building courtyard on Na Poříčí Street.
The world “palladium” has many meanings. For example it is one of the precious metals. Also, “Palladium of the Bohemian lands” it is an important symbol of Czech history – it is a legendary, ancient picture of Madonna and a child made of metal that is believed to have a protective power over the Czech nation. But the main reason why Palladium was chosen as a brand name was to support the spectacular, palace-like, unique, one-stop shopping experience of the mall.
To build a complex of such a size as Palladium is always a challenge, especially when it is located in the centre of a “UNESCO” town, with many historical monuments around. As mentioned above, the construction was stopped for 3 years in order that the archaeologists could do their work. During the construction the underground station Náměstí Republiky was
The mall’s building was owned by the military for more than 200 years. Is there any interesting story concerning that?
Thanks to the construction of Palladium, the rich architectural heritage of this site was disclosed to professionals and the public
Yes, Palladium was built on the site of the former “Jiří z Poděbrad” barracks. The complex had become dilapidated in the second half of the 20th century as the facilities were not used very much. While occupied by the army, the complex was completely closed to the public. It was not until the beginning of the 90s that the Ministry of Defence decided that the site should serve a more useful purpose.There were many famous Czech personalities within the army crew, for example Josef Kajetán Tyl who wrote the lyrics to a song that became the Czech national anthem later on.
Fot. Palladium
SHOPPING MALL EXPERT |
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Q&A
Fot. Palladium
closed in order to build a direct access to Palladium, the tram´s rails were replaced and many other necessary things were taken care of. The building is comprised of 11 floors of which 5 are above and 6 below the surface. The construction was obviously neither easy nor inexpensive.
Was it intended that the architecture should be a combination of historical and modern? The project revitalized a previously neglected 13,500 sq m site in the heart of old Prague. Palladium’s developer won a tender for the sale of the barracks properties with its plans for a mixed use project including reconstruction of the historically preserved buildings and an extension. The architectural concept for the exterior aimed at sensitively blending a historical building (a 19th century barracks) with modern elements. Now it offers a gross area of 115,000 sq m, with 39,000 sq m of them retail, 19,500 sq m of modern offices and the largest underground parking facility
To build a complex of such a size as Palladium is always a challenge, especially when it is located in the centre of a “UNESCO” town
educational stand for the “Hands on Breasts” project placed in Palladium to teach women self-examination of their breasts and to inform them about other screening methods available.
in Prague with approximately 900 parking spaces. Palladium’s building has been awarded several prizes.
Palladium helps many organizations, for example The Fund for Children in Need.
Your shopping mall publishes “Palladium Magazine”. Isn’t the publication of information or news on the website enough?
It’s true. We cooperate with many Czech and international charities on a long-term basis. We help them with promotion and fundraising by offering them free rental of space for their exhibitions and stands and other activities. This year there will be a special
Palladium Magazine is created in the form of a lifestyle magazine. It introduces new trends in fashion, beauty and health, includes 3 photo fashion stories and articles with sports and psychological themes, tips for new CDs, books, recipes and many other articles. We produce not only a hardcopy version of the Magazine, but Palladium Magazine as an interactive application for smartphones and tables with extra content and videos is being launched with each issue as well. Apart from the webpage, of which there will be a new, responsive design introduced at the beginning of 2015, we are very active on our Facebook page and we have a blog on which we cooperate with many bloggers and even “celebrity bloggers”,
Palladium Magazine is available not only in the hardcopy version, but also an interactive application for smartphones and tablets
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for example the two sisters who write the blog “A cup of style” and won the Blogger of the Year award in 2014 in the category of Fashion. All those communication channels help us introduce our events and the wide variety of products of our shops to potential customers.
115,000 sq m of gross area
39,000 sq m of retail area
Is Palladium popular among people from abroad? Citizens of which countries visit your mall most often?
195,000 sq m
Depending on the season a significant part, around 20 – 30%, of Palladium´s footfall is created by tourists. They represent not only an important part of the footfall but are equally influential in the tenants’ turnovers. These are mostly Russians, Brits and neighbouring Germans and Slovaks among others.
of modern offices
16 million
people visited Palladium in 2013
There are many different events organized in Palladium. Which of them take place in the mall the most?
Fot. Palladium
During the year we organize two big 3 day events and several smaller ones. 3 day events are comprised of discounts and gifts with purchase from the majority of Palladium tenants, fashion shows, styling and other services for free, musical performances and many other activities. We also take part in events organized by a 3rd party such as the most popular shopping event organized in the Czech Republic – Marianne days (organized by Marianne magazine/Burda Media) and a newer project Shopping Fever (organized by three Burda Media magazines).
What about events that concern art?
We have one area that is dedicated to exhibitions throughout the whole year. An exhibition usually lasts for 1 month, so we have around 10 – 12 exhibitions of paintings or photographs each year. We have an Art program in the Palladium Offices too, with exhibitions of renowned modern Czech painters.
What are the challenges that the shopping centres in Czech Republic will have to meet in the near future? Is there any challenging task for Palladium to perform?
70.000
Probably the biggest challenge, especially for some product groups, is the increasing popularity of shopping online. Therefore a shopping centre must provide an add-on in form of a pleasant atmosphere, extra services and, most of all, an interesting tenant-mix.
clients visited Palladium per day before Christmas
20-30%
of clients are foreign tourists
How would you characterise the Czech shopping centre market?
more than 200
There are almost 350 shopping centres, retail parks and hypermarkets in the Czech Republic. The expansion of them started around 1999 with the biggest boom, especially in Prague, between 2005-2008. Although the Czech market seems to be quite saturated, there are still some, mainly smaller and locally based, shopping malls being opened each year and several existing ones have been recently enlarged or their enlargement is planned. ☐
shops on 5 levels; 11 floors – 5 below and 6 below surface
10-12
exhibitions of paintings or photographs each year
Anna Chwałczyńska
SHOPPING MALL EXPERT |
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