LAS VEGAS—As leasing managers seek more inventive methods to reduce vacancies and increase NOI, more properties are engaging non-traditional tenants and are thinking creatively about how they can make the best use of their property's space. So says Sharon Leoff, president of Shopworks Inc., based in Scottsdale, AZ. Leoff held a workshop course at ICSC RECon 2018 on who non-traditional tenants are, how to engage them, the best leasing structures, and innovative ways to make the best use of a retail center's space.
“In our changing world of malls, leasing representatives need to be thinking outside of the box,” she said. “Each type of center has a different priority, different space that can be utilized uniquely. And when you look at each type of center, each offer different opportunities and challenges.”
The good news, according to Leoff, is that the mall continues to be a central gathering place for the community. “About 75% of all Americans visit a mall at least once a month. Shopping malls have become the third most frequented location for Americans, after home and work.” She added that “shopping at the mall is a social experience and 81% of Americans shop with someone else.”
When looking at shoppers, age is important and is key to understanding which uses make the most sense. “Although the overarching stereotype of Millennials is that they only shop online, they do shop in stores and often only use their phone or computer to compare prices.”
So who are the customers now and in the future? Leoff said that in a consumer market driven by Millennials, it is crucial that retailers not only produce and supply the products popular with the generation, but to also design stores with this influential client in mind. “Millennials are impressed by stores that are easy to navigate and connected to technology. They are drawn to spaces that seamlessly transition between indoor and outdoor.”
And since Millennials grew up with the newest technology in the palm of their hands, they are interested in stores that offer experiences drawing from tech trends, she added.
We also touched base with industry expert Dotan Zuckerman, partner and VP of leasing for Columbia Development, on millennials and unique retail. He notes that unique dining experiences are a key ingredient in successful retail developments and can really set properties apart from one another. The most successful retail developments will offer an array of culinary experiences that are distinctive and interesting, he says.
“As technology transforms nearly every aspect of retail, consumers are attracted to services and experiences they cannot get online; and, chef-driven restaurants and food halls are a great example of this. While consumers have the option of ordering takeout from a smartphone and having it delivered to their door, they have to visit a brick-and-mortar location if they really want the immersive, social experience of dining out,” Zuckerman tells GlobeSt.com. “The millennial lifestyle of settling down and having children later in life lends itself to eating out at restaurants more often. These consumers want high-quality dining experiences at a reasonable price point, and food halls and chef-driven concepts satisfy that craving.”
Another point we cannot ignore, Zuckerman explains, is the rapid increase in popularity of third-party food delivery services. “Amid the rise of self-driving vehicles and the success of food-delivery apps like UberEats, retail developments will need to plan ahead in order to accommodate these new changes. At our development, Fenton, in Cary, North Carolina, chef-driven concepts and technology are at the forefront of our design, and we look forward to seeing how that differentiates our mixed-use community from the competition in the market.”
Keep checking back with GlobeSt.com for more from experts in the next few days and weeks as we fully cover the RECon 2018 event, with thoughts not only from attendees and panelists, but coverage of sessions, parties and more (even after it is all over). Also, be sure to check out some related stories below.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
