The ICSC RECon in Las Vegas gave us a chance to speak to Karen Raquet, who is the Director of National Retail Property Services JLL.Karen started off the chat by telling us that they have had an “extremely positive” experience at the event this year and that they have been “absolutely busy nonstop”. To add to the feel-good factor, she said that they feel that for the first time in several years “properties have really started to trade”, which benefits National Retail Property Services.
She puts at least part of this down to Sears developing plans for their stores, which is great for them as third party managers and means that “there is a lot of opportunities” for them.
Combining Channels and Creating a New ExperienceWe asked Karen about the latest trends she has seen and what consumers now want from shopping centers. She said that they have seen the need to “combine both digital and bricks and mortar”. Those retailers who do this to a high standard “are doing very well”, in her opinion.
On the other hand, she feels that those firms that haven’t yet embraced the multi-channel experience “are suffering because of it”. She says that consumers want the ability to do things such as research on their phone and compare prices while they are in a store or mall.
We then moved on to discuss the importance of entertainment and leisure options in modern shopping malls. We asked Karen whether it is as important a trend in the US as it is in Europe and elsewhere just now. “Absolutely”, she replied, and pointed out these things are “transforming many shopping centers”.
Food and Entertainment OpportunitiesShe pointed out that leisure and entertainment options take up a lot of space but also offer a “tremendous opportunity to attract traffic”. Karen was also keen to point out that food is very important and that a lot of food options are being added to their properties.
To follow up, we asked for some specific examples of new food or entertainment developments that have been made by National Retail Property Services recently. Karen then told us about their project in Kendall, Florida.
This is the Kendall Sports Mall development and it is a “fun center” set over 9 acres with activities such as swimming and zip-lining on offer. This type of sports mall is being developed all over the country by a client of theirs.
In terms of other big projects being worked on just now, Manhattan Village is a major redevelopment in Manhattan Beach worth $150 million. This will see them adding exterior components to a currently enclosed mall.
Expectations for the Year AheadWe also asked about the trends and expectations for the coming year. While she doesn’t think that there will be major changes in the next 12 months, she does think that “developers will need to be more creative”. Karen then pointed out that current down-sizing issues across the country mean that people need to be creative about how they use their square footage in different ways.
The next thing we wanted to ask Karen about was whether she felt that there would be changes in the design and architectural layouts of the mall in the US in the near future. On this issue, she believes that the outlet side of the mall business is where there are “significant" growth possibilities. She doesn’t expect there to be growth in the number of enclosed malls in the next year across the US. She then said that she hasn’t seen any significant changes or trends in terms of architecture, although she does expect shopping centers to be more consumer friendly in the future.
An interesting point made by Karen and her colleagues is that older, enclosed malls will often put a big name store – such as L.L. Bean - outside and let them re-design the exterior with a flagship store. This will then completely change the look of the center.
Making a Connection at the MallIt was then pointed out to us that “the mall is very much alive” in the States, as evidenced by the company’s Let’s Go Shopping marketing campaign. Karen said this is a great campaign that gives a “warm feeling” and is about “making a connection at the mall” and building relationships there.
We then asked if this campaign was partly about helping retailers with their communications. Karen said that it is about getting out the message that malls are still doing well and that 92% of sales still happen in bricks and mortar establishments.
The conversation then turned to the efforts that many retailers are making to move into the online world with e-commerce stores. We asked if National Retail Property Services is likely to create e-commerce solutions for retailers and malls. Karen then explained to us about their current service that allows customers to opt-in to a service that lets them receive messages on current store campaigns and events.
She then spoke about their goal of bridging the gap between bricks and mortar and digital shopping. “That’s our goal and that’s our job”, she went on to say. She wants them to “make it very easy for the consumer” to use their mobile device while they are in the mall. Karen feels that this ability to combine both ways of shopping is key for retailers looking to progress and grow.
We then asked about the company’s portfolio. She said that they are currently managing over 1,000 centers right now, which covers around 125 million square feet. These figures can fluctuate but are, on the whole, “increasing significantly”.
In terms of new centers that have come under their management in the last year of so, Karen told us that they had a “big jump” and probably took on several million square feet in that time, in a total of some 400 to 500 properties. She said that they are doing very well in the coastal markets, as well as in Chicago.