The International Council of Shopping Centers (ICSC) had its annual convention in Las Vegas last month, in which developers, brokerage firms and retailer/restaurant brands all converged in one place to wheel and deal. After discussions with many of these movers and shakers in the retail industry, there were a couple of noticeable trends that were repeatedly mentioned.
Strength in Diversity
Having a diverse mix of tenants is now necessary in order to attract all-day traffic from all types of consumers, especially in the still-trending mixed-use developments within a suburban environment. This diversity can include adding fresh and unique food and retail tenants that are not necessarily national chains, as customers are seeking new, concept-driven experiences. The Woodmont Company, Thompson Thrift and Centennial all emphasized seeking more regional-based local food tenants because today’s younger, more urban customers want fewer cookie cutter-type brands, and instead prefer more eclectic authenticity from localized mom-and-pop establishments.
NewMark Merrill discussed the importance of having a wide range of different product types in one location, including a compelling array of tenants that includes not just traditional retail but also schools, medical services, apartments and hotels. JLL added that because having a diverse mix is so important, tenants that were once considered taboo in a traditional shopping center setting, such as tattoo parlors, liquor stores or auto repair brands, are now considered beneficial toward the whole retail experience.
In addition, Steiner + Associates admitted that for its flagship shopping center, the Easton Town Center, the developer strives to not only feature local restaurants and mainstream brands that appeal to the masses, such as Claire’s and H&M, but is also actively boosting up its luxury brand assortment to appeal to the higher-end shopper.
Diversity can also include attracting all age segments, from senior citizens to younger children. For example, Coldwell Banker Commercial revealed that a popular theme in retail at the moment is “medtail” — such as physical therapy, chiropractors and even dialysis center tenants — which especially appeal to the aging baby boomer segment of the population. As for engaging the youngster set, The Woodmont Company anticipated that child care co-tenancy in retail centers is on its way toward becoming a popular trend.
Time to Mix and Mingle
Another prevailing theme was to cater to the consumer’s pent up demand for sociability. This includes creating outdoor village/town center atmospheres in shopping centers that encourage congregation, as well as providing tenants that can fulfill the social needs of the ever-growing suburban-based demographic.
Executives from Cushman & Wakefield, JLL and Centennial all noted the need to create more opportunities for fun social encounters, including targeting tenants that encourage group gatherings. This can incorporate live music venues, specialty “eatertainment” restaurant concepts, such as Chicken N Pickle, or child-centric learning centers and play zones, such as Little Kitchen Academy. Beta Agency mentioned the importance of having common areas that encourage the idea of gathering together, which benefit not just the retail and restaurant brands, but also consumers.
Centennial and Poag Development Group both added that because social activities are such a priority right now, athleisure apparel is anticipated to take a backseat in favor of more “going out” clothing tenants, such FRAME, Chico’s and Jos. A Bank.
