- Land Securities Retail

spring 2014
Premium players
Why premium fashion retailers
hold the key to success
Destination leisure
The importance of leisure
in retail-led schemes
Foodie generation
Retailers seize opportunities as a
new trend in dining out emerges
Fashion mission
Why Karen Millen plans to ‘democratise luxury retail’
20
Foreword
Leading the way in
retail innovation
As this is my first issue of A1 since taking on the role as managing
director of Land Securities’ Retail business, on behalf of the team I’d
like to thank Richard Akers for his leadership, and his support during
the handover. Richard has made an outstanding contribution to Land
Securities since joining the company in 1995 and, under his
leadership, we have cemented strong relationships with retailers,
been a driving force in the retail property sector and our portfolio has
consistently outperformed the index for the sector in the UK.
As a business, we have always focused on proactively responding to
changes in the market, as the feature on page 30 shows. People are
buying more online, but we are still social creatures; we want to meet,
try and taste. Put simply, you can’t eat out online and there is huge
interest in dining out and experimentation with different cuisines. As
a Canadian who has lived in this country
for more than 20 years, I have seen this
transformation first hand. When I first came
to London there was a limited choice of
cuisines, now London is the foodie capital
When I first came to
of the world, and that trend is extending
London there was a
across the UK. The feature on page 20
limited choice of cuisines,
explores this trend and Land Securities is
pioneering concepts such as Trinity Kitchen
now London is the foodie
at Trinity Leeds and Bar 44 – the mobile
capital of the world
tapas offer at St David’s in Cardiff.
Retail innovation has never been more
critical and we’ve recently announced our
support of TrueStart’s hub (page 26). It is
designed to bring together the brightest young minds and start-ups.
The partnership will give us and our customers exposure to the most
cutting-edge products and technological developments in the retail
and consumer world. TrueStart entrepreneurs will have access to
Land Securities’ highly skilled people across different disciplines, who
will share their expertise, offer mentoring and help the entrepreneurs
accelerate their start-ups’ growth. We will also offer TrueStart access
to our portfolio of premium retail locations across the UK.
10
23
14
17
2
spring 2014
4
News The latest initiatives
and retail developments from
Land Securities’ shopping schemes
5
Retail deals Land Securities’
latest retail property deals
completed in recent months
My aim is to ensure that these creative ways of thinking thrive in our
retail business, as dynamic and cultural change continues apace in
the retail sector. It’s a challenge I will relish.
Scott Parsons, managing director,
Retail portfolio, Land Securities
Contents
6 Interview Karen Millen chief
executive Mike Shearwood on
democratising luxury retail
14
10 Fashion Why premium fashion
retailers are enjoying success
6
We meet Karen Millen chief executive Mike Shearwood
14 17 Leisure The importance of leisure
to retail-led destinations
Development The Nova development
is transforming Victoria, London
into a vibrant, cultural destination
20
23 Leisure A new dawn has risen for
innovative places to eat out
Initiatives Retailers are tapping
into the fashion-hungry youth with
student lock-ins taking place in
UK shopping centres
26 Development Land Securities has
teamed up with TrueStart, a
venture to find real talent in retail
28 Space Changing shopper habits
are creating opportunities for
retailers when it comes to opening
new stores and expanding space
30 Community Land Securities is
set to launch a platform to
communicate its Corporate
Social Responsibility strategy
32 Retail view Land Securities’
Richard Akers and John Lewis’
Jeremy Collins on the state of
play in the retail market
34 Portfolio An overview of
Land Securities’ shopping
centres, outlets and retail parks
spring 2014
3
News and deals
Retail deals
initiatives
spring 2014
Premium players
Why premium fashion retailers
hold the key to success
Destination leisure
The importance of leisure
in retail-led schemes
Foodie generation
Retailers seize opportunities as a
new trend in dining out emerges
Fashion mission
Why Karen Millen plans to ‘democratise luxury retail’
Editor
Charlotte Hardie
Writers
Ben Cooper, Mark Faithfull,
Gemma Goldfingle, Tiffany
Holland, Alex Lawson, George
MacDonald, Rebecca Thomson
Production Editor
Tracey Gardner
Design
forty6 design Ltd
www.forty6design.com
Publisher
Tracey Davies
For Land Securities
Engaging styleconscious females
Land Securities’ latest retail property deals to be completed in the UK in recent months
Land Securities has teamed up with Glamour.com to
host a special evening at six of its UK shopping centres
at the end of March to help boost sales turnover and
promote awareness of the centres’ extensive retail and
leisure offer.
Timed to coincide with the arrival of New Season
collections and just ahead of Mother’s Day, this latest
promotion builds on the success of the Land Securities’ student lock-in model. It aims to stretch and
reward spend across ladies’ fashion, accessories, beauty
and homewares retailers within a three-hour period.
The 37,000 women forecast to attend the one-night
only ‘Treat Yourself & We’ll Treat You’ shopping
event will be able to indulge in offers from their
favourite brands and then stop off at the Treat Zone
where the rewards get better the more they shop. On
the mall, activity will also allow retailers to showcase
New Season’s collections and engage shoppers in competitions to win must-have products. As a way to drive
viral engagement, shoppers will also be able to create
their own Glamour magazine cover and share with
friends via social networks.
The O2 Centre, London
Gunwharf Quays, Portsmouth
Number of deals Number of deals Four
Retailers and sq ft
Three
Retailers and sq ft
Falafel City Carluccio’s
5,220 sq ft
Frankie & Benny’s 5,041 sq ft
Original Penguin
1,132 sq ft
Wagamama
3,136 sq ft
Dr Martens
2,068 sq ft
Rossopomodoro
3,166 sq ft
All retailers are open and trading
350 sq ft
Falafel City is open and trading.
The remainder are due to open
key statistics
in spring this year
425,000 sq ft outlet centre
91 premium outlet stores
key statistics
32 bars and restaurants
5.1 million annual visitors
8 million annual visitors
300,000 sq ft of retail and leisure
More than 30 million commuters
arriving/departing from four
Claire Reynolds
[email protected]
tube/rail stations within a
development
T +44 (0)20 7747 2390
10-minute walking distance
Sejal Lad
[email protected]
T +44 (0)20 7024 5411
Accommodating
omnichannel
© Retail Week
All material is strictly copyright and
all rights were reserved. Reproduction
in whole or in part without the written
permission of Retail Week is strictly
forbidden. The greatest care has
been taken to ensure the accuracy
of information in this magazine at the
time of going to press, but we accept
no responsibility for omissions or errors.
The views expressed in the magazine
are not necessarily those of Retail
Week or Land Securities.
A1 is printed by Headley Brothers Ltd.
Ashford, Kent
Produced by
4
spring 2014
The Centre, Livingston
St David’s, Cardiff
Land Securities has
rolled out a next
Number of deals Six
Number of deals Five
generation web
platform to 14 of
its UK shopping
centres as part
of its investment in
Thumbs up for White Rose expansion
Leeds City Council has given the
go ahead to Land Securities’
expansion plans for the White
Rose Shopping Centre.
Councillors supported plans
to expand the shopping centre
by 185,000 sq ft at a planning
committee meeting in December.
The plans include a 12-screen
cinema, 25,000 sq ft of restaurant
space, 110,000 sq ft of A1 retail space
and a 570-space car park.
Decisions are now being made about
how the work should be phased, and
details such as the S106 planning obligations are being agreed with Leeds
City Council.
Stakeholders and community leaders
are backing the proposals and Land
Securities will be working with them
to employ people locally and to provide
training along with the job opportunities as part of its continuing commitment to community engagement.
Retailers and sq ft
Retailers and sq ft
Pandora
823 sq ft
Bose
2,330 sq ft
Phones4U
253 sq ft
Tiger
2,550 sq ft
Xile
3,822 sq ft
The White Company
4,560 sq ft
Yankee Scotland
1,377 sq ft
Clogau
1,450 sq ft
friendly Web 2.0
Muffin Break
1,600 sq ft
Ecco
1,185 sq ft
platform will improve
Kidzeco
2,676 sq ft
All retailers are open and trading
the user experience,
All retailers are open and trading
an omnichannel future.
The mobile device-
helping people find
key statistics
relevant information
key statistics
More than 180 shops
quickly and intuitively.
1 million sq ft of retail and leisure
1.4 million sq ft of retail and leisure
More than 150 shops
18 million tourist visitors
It also showcases
retailer offers and
videos through
1million-plus visitors a month
embedded rich
media content and
social media feeds.
spring 2014
5
Interview
Fashion
mission
Karen Millen chief executive Mike Shearwood is on a mission to “democratise
luxury retail”. He tells Gemma Goldfingle of his grand plan
I
t’s been a busy first year in charge of Karen Millen for
chief executive Mike Shearwood. The womenswear
retailer has undergone a slick rebrand and now has
an eye-catching new logo, a sleek new store design
and two flagship stores in the offing in the world’s
most premium postcodes.
Karen Millen is opening a New York flagship in the
spring and the ink is just drying on its new three-floor
store in London’s Knightsbridge, sandwiched between
Harvey Nichols and Harrods. “This gives us a triple-fronted
presence in one of the most prestigious streets in the
world,” says Shearwood.
The new prestige sites define where Shearwood is aiming
to position the brand, as a luxury retailer. The Karen Millen
boss has identified a gap in the “accessible luxury” market,
with no global retailers offering affordable, premium product,
and he is on a mission to ensure Karen Millen fills that gap.
However, this is no mean feat for the retailer. “Internationally KM’s perceived at a level more premium than in the UK,”
explains Shearwood.
“In the UK, there were people who passionately loved the
brand who were saying ‘it’s great quality’, ‘it’s really stylish’
6
spring 2014
then there was part of the population who thought it was
high street and a bit WAG-like.”
Shearwood admits that the disconnect is down to the
retailer not fully explaining its true point of difference. “We’re
actually a fashion house,” he explains. “Every single item is
designed in-house utilising our atelier.”
Inside its Shoreditch HQ is a thriving design studio,
with pattern cutters, designers, graders and garment
technologists hard at work in a scene one would expect
from a top Milanese label.
“The majority of our fabrics are Italian,” says Shearwood.
“We develop a lot of the yarns ourselves and with new
techniques. The process is very much couture-inspired but
the consumer facing part of the business has been traded as
a high street brand.”
So he and his team set about changing the brand’s high
street perception and carving out a niche for the retailer in
‘affordable luxury’.
Exclusivity of product is key to its luxury positioning.
“If you think why people are prepared to pay more
for garments, it’s not just about quality, it’s about
brand perception, which is driven by exclusivity and
g
spring 2014
7
Interview
knowing that they’re not going to see a lot of people
wearing,” he says.
Karen Millen has short product runs with just 50 to 250
items made in some cycles, explains Shearwood. This
compares with 80,000 items that some high street retailers
produce. Shearwood is looking to enhance this further by
spreading its product wider overseas so there are fewer items
in each country.
DIGITAL
DEVELOPMENTS
Mike Shearwood was one of the first
retail chief executives to truly back
multichannel retail and during his
time at Aurora Fashions he coined
one of retail’s most used buzzwords
Changing brand perceptions
Marketing will play a crucial role in moving away from the
flashy, footballers’ wives reputation and Karen Millen is
investing heavily – a move that is long overdue, according
to Shearwood.
“We’re absolutely confident that the price and quality of the
garment is more compelling than the competition but we
haven’t made a lot of noise about the brand for a long time.
A new brand would enter the UK and spend significantly
more on marketing than we ever have.”
It enlisted famous photographer David Bailey for its
autumn campaign last year to help kick-start the rebrand.
The campaign focuses on close-ups of the models
and clothing to highlight the detail and craftsmanship of
its products.
It also strives to show that Karen Millen was more than
just a dress brand. “The range is broader than most people
perceive,” Shearwood insists. “We have more than 600 SKUs
per season from leather and denim to separates, knitwear,
coats and dresses.”
Shearwood admits that the product in its smaller concessions has a dress bias but it is rectifying this in a move that
could broaden its appeal.
“There is a whole generation out there who haven’t considered Karen Millen, as their perception is that it’s just a dress
brand and that’s our fault because we haven’t done anything
to make them think any different. We’re trying to introduce
the brand to new clients while trying to retain our old clients.”
The rebrand also extended to its store experience,
a key part of its strategy for “democratising luxury”,
says Shearwood.
“Sometimes the luxury experience can be quite snooty but
fashion is fun. We want to create an indulgent, informed, fun
experience for our clients,” he says.
It has reduced the number of sizes it displays in store to
allow the products to breathe and make it easier for its
customers to shop.
Karen Millen has also launched its ‘Client First’ initiative
to help educate its store staff on how to improve customer
experience. This includes information about the fabrication
of its products. “Differentiating yourself through your service
offering is one of the hardest things to do because it is about
consistency of delivery. But it’s the hardest thing for your
competitors to emulate,” he says.
Shearwood predicts that in-store experience will become
the new battleground in retail. He believes that while the
growth of multichannel means that fewer stores are required,
they are, in fact, more important than ever. Stores will need to
become more experiential to woo customers, he argues.
8
spring 2014
– omnichannel. The group, of which
Karen Millen was part of, carved a
reputation as an innovator in the
field, spearheading initiatives such as
mobile point of sales, with employees armed with iPads on the shopfloor, 90-minute deliveries and using
a single stock pool to fulfil orders.
Shearwood says digital has been
a major competitive advantage
for Karen Millen, especially given its
small product volumes.
“When someone really wants
something, the last thing you want as
a retailer is to have that product in
a store that is not accessible to the
client,” he says. “Having one stock
pool enables your customer to find
that scarce product online and has
improved our full-price, sell-through
rate and has enhanced our margin.”
However, Shearwood says the
store will continue to be a key part
of the shopping experience. “Clients
enjoy feeling and touching product,
they enjoy shopping with friends. But
they are more informed about the
garments they’re buying, the price
they pay and the quality and the use
they’ll get out of them, and the internet has helped them do it,” he says.
He says online and stores complement each other and points out
increasing numbers of shoppers are
coming to store with pages printed
from the internet while others try on
garments in stores and buy at home.
“You have to embrace it because
if you don’t offer the client the way
they want to shop, they’ll go somewhere else,” he says.
Karen Millen has also recognised
the importance of multichannel
to its international growth and has
begun rolling out websites for its
international franchise partners to
operate. Shearwood believes that
retailers cannot ignore the role that
multichannel plays in a franchisee’s
world and by giving them control of
the website it encourages them to
promote the channel.
“When I started in fashion retail I was told that product is
king. Your stores could be terrible, your service could be
appalling and as long as you’ve got great product at the right
price it will sell. Now, that’s not enough,” he says.
“For merchant retailers, you can see the same trends across
the high street. You need to do more than product – better
store environment, better store experience, a good digital
offering, a clear tone of voice, consistent price architecture.
Retail has become more complex as the consumer is now
more educated and discerning. Retailers have to do so many
things better than they did.”
Climbing the ladder
Shearwood, who joined Karen Millen last March from
former parent firm Aurora Fashions, has a long history in
retail. Over the past 15 years he has worked in fashion,
however, he started his career as a qualified optician
rising through the ranks of Vision Express, notching
up many director roles from operations to services to
business development.
His well-rounded skills gave him the push global fashion
giant Inditex – owner of Zara – needed to spearhead its
UK expansion. He joined as UK managing director of
Inditex in 2000 when Zara had just a handful of stores. When
he left for Aurora predecessor Mosaic in 2007, Zara
had more than 60 shops and was becoming one of the
UK’s favourite fashion brands.
His experience at Inditex, the world’s biggest fashion
brand, will help him in his quest to build Karen Millen’s
international business.
The retailer already has a vast overseas presence, trading
from 58 countries. By the end of the year that number will
rise to 65 with 40 new stores planned in territories such as
southeast Asia, central America and even Outer Mongolia
on his hit list.
Shearwood says its broad range has appeal across
nationalities and culture and says its “well-educated,
confident, feisty” customers are a very international audience.
But he says its rebrand has been essential ahead of its
international push, as a global brand needs to generate
a “consistency of opinion”.
“That’s not saying that everyone needs to like it but they
need to agree on what it is,” he explains.
The focus on affordable luxury presents Karen Millen
a golden opportunity to prosper as very few global
womenswear players operate at its price points. Shearwood says the complexity of global fashion has put
retailers off.
“It’s not an easy thing to do, to operate in the same season
across massively diverse temperature zones,” he says. “I was
on a trip to Asia recently and Beijing was -12 degrees and
Singapore was 33. That makes it hugely complicated.”
But these are complications that Shearwood and his
team have clearly overcome as its overseas business now
accounts for 65% of sales. And now that it is suited and
booted with a new brand image, there seems no stopping
Shearwood’s overseas invasion as further countries have
luxury democratised. l
spring 2014
9
Report
premium
A
performance
Y
ou only need to look at the numbers to
see that the 2013 Christmas period was a
good one for premium fashion retailers.
At Jigsaw, like-for-like sales were up 17%.
Jaeger boasted an impressive 32% jump
over the period. Karen Millen, meanwhile,
produced a 12% increase, with the retailer operating from 400
stores and in 58 countries.
These heartening performances came in an environment
that was still challenging for retailers. The British Retail
Consortium (BRC) reported overall retail sales rose 0.4%
compared with December 2012, highlighting the extent of the
achievement for the premium sector.
The success of this category is understood best when you
realise that this strong performance hasn’t been limited to
Christmas. Over the past five years the premium category has
gone from strength to strength, with brands including The
White Company, Whistles, Karen Millen and Coast all
increasing store footprints and growing sales across channels.
“The premium market has definitely recovered quicker than
the mass market,” says Jaeger chief executive Colin Henry. “We
are optimistic about growth.”
Peter Ruis, chief executive of Jigsaw, adds: “If you are at the
slightly more premium end of pricing, you have more tunes you
can play in a very difficult economy.”
Customers clearly like what the premium mass market is
offering them. For Henry, the polarisation trend of the past
few years is one of the main factors supporting growth. He
says: “The top end and bottom end of the market could potentially grow at the expense of the middle market. People are
prepared to spend more money for a higher-quality product.”
Ruis agrees and says premium pricing gives a retailer more
room to breathe. “You have to have something to play with. At
the lower end of the market, there’s not a lot of margin to play
with. You are always going to get beaten on price.”
He adds that one of the things the premium market has in its
favour is what every retailer needs to survive – something
unique about the brand. “It’s the same old clichés of a differentiated, authentic proposition.
“If you’re innovative and differentiated you’ve got a chance.
It’s easier to be that way at a more premium end,” he says.
Didier Drouet, chief executive of LK Bennett, says this
10
spring 2014
Premium retailers are
having a good time of
things. Rebecca Thomson
looks into why the
sector has enjoyed such
success recently
Premium
Christmas
sales
Sales results from retailers that
publically announced Christmas
performance
Store sales
(% change in like-for-like sales 2013):
Jaeger +23%
Jigsaw +17%
Fortnum & Mason +13.4%
Online sales
(% change in like-for-like sales 2013):
Jaeger +57%
Jigsaw +39%
Fortnum & Mason +26.4%
Source: OC&C Strategy Consultants
differentiation allows them to build a loyal customer base. He
says: “We have a dedicated client base who purchase investment designs that are timeless with a twist. We also benefit
from customers who are trading down from luxury but are
unwilling to sacrifice workmanship, design and quality. In
recent seasons we have seen a strong reaction to our more
directional fashion product, which signifies a renewed interest
from our younger, more trend-focused customer.”
Ruis adds that the touches that make a brand more
individual are the same elements keeping customers coming
back. “Design integrity, customer service. Consumers are
clever people.”
David Harper, founder of property agency Harper Dennis
Hobbs, says premium retailers have thrived as customers seek
escapism from a bleak economic atmosphere. “People get bored
of the recession. They want to go out and treat themselves.”
This is often easier to do at premium retailers than at the
luxury end of the market. LK Bennett director of merchandising Sarah Thornley says: “There has been a steep rise in
prices at the top end of luxury brands in recent seasons. This,
along with a general mood for less conspicuous consumption
post the global recession, has created an opportunity for affordable luxury brands.”
The journey hasn’t been an easy one, however. The recession
has claimed retailers including Nicole Farhi, and those that are
left have learnt the hard way how to operate in the new climate.
Ruis says: “Pre-Lehman brothers, in 2008, it was a very
benign economy. As long as you were half decent you would do
well. Now, you have got to be good to do well – and you’ll soon
find out if you’re not.”
Harper puts it bluntly. “As the recession bit the [weaker]
retailers went out of business. We were left with the good
retailers. They have had to get better because of the changing
market,” he says.
Pre-2008, retailers might have got away without a strong
online presence – not anymore. Ruis says: “You can’t survive
without a good digital platform, and increasingly some
of the digital players can’t survive without stores. It’s more
complex. Everything’s the same, but at the same time
everything’s different.”
He says customers still love shopping, and they like
going into shops. “If you do surveys consumers say they love
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spring 2014
11
Report
Q&A: Jane Shepherdson,
chief executive, Whistles
What have consumers responded well to in Whistles’
brand and proposition?
I think that consumers
have responded well to
a quality, edited collection that represents the
key trends of the season
in a wearable way,
and that is accessible
Q&A: Will Kernan, chief executive,
The White Company
in a way that designer
collections are not. She
has come to trust that
Whistles’ interpretation
of the seasonal trends
Why have consumers responded so well to The White Company’s brand and
is one that will work
proposition?
for her.
The White Company brand has been built on bringing our customers everyday luxury at affordable prices – the latest catwalk trends and cutting-edge designs are
What does Whistles bring to a high street or shopping
not as important as impeccable style and great prices for the exceptional quality
mall that other retailers do not bring?
we provide. We’re all about timelessness, attention to detail, and understated
Because the collection is limited, we’re forced to spend
elegance while being practical and versatile. Product quality is key. Newness is important but only where it builds on our brand credentials and lifestyle proposition.
more time reviewing and editing it so that the pieces
Premium retailers
such as Jigsaw (left)
and Reiss (right) are
going from strength
to strength
that remain are exactly what our customers want. Our
customers get a level of quality in terms of fabric and
make, and design that they do not get on the rest of
the high street.
What does The White Company bring to a high street or shopping mall that
other retailers do not bring?
Our customer loves the combination of the sensory experience of our stores, as
well as the oasis of calm, excellent service, exceptional guidance and personal
What role do stores play in Whistles’ proposition and
strategy, and how important are they to the brand?
Our stores are very important as a showcase for the
range, and as a place that our customers can come
for style advice and outstanding customer service. Our
staff are carefully chosen for their advanced social skills,
personal style and willingness to go a little bit further than
is expected. Our store staff are very special. Online sales
are obviously becoming more and more important to
us, but we feel it is crucial to combine the service that
we offer in store with an extremely flexible online delivery
service to give our customers the full Whistles experience.
Anything in our collection can be bought from any of our
stores, or from our website, wherever it is, and delivered
the next day to wherever the customer wants it – nothing
is a problem.
What opportunities are there for Whistles in the
UK market?
We’re still looking to expand in the UK, as there are
many cities and regions where the brand is
unrepresented, and that we feel the whole brand
experience is missing.
How do you see the brand and proposition
developing?
As we expand the brand internationally, we’re learning
how customers respond in different parts of the world. We
need to be aware of and respond to such differences.
We’re also introducing a menswear range to complement the women’s offer in September.
12
spring 2014
shopping, and they define shopping as visiting shops. They see
online as convenient and providing the ability to research.” So
far, nothing much seems to have changed from the early 2000s.
But Ruis adds: “What has changed is how we measure
success. It used to be all about like-for-like growth and how
much extra space had been added. It was a very linear model.
These days, you could be running stores that are flat or even
losing money, but be doing a really good job. There’s a very
different rhythm.”
Now, instead of looking at each store in isolation, retailers
must measure success in a more holistic way, says Ruis. “You
have to look at every channel you’ve got,” he says. “Online, the
concession model, the concession’s website, and add them all
together. Our web business is currently 46% up year on year.”
The stores, meanwhile, might be judged on footfall or on
number of transactions, but what is clear is that premium
stores have fitted neatly into the multichannel model.
Customers enjoy using them as a support network for the
online channel – they provide service, a chance to touch and feel
product, and they act as a showcase for the brand.
Henry says Jaeger’s stores are a crucial part of the business’
success. “Stores are fundamental in terms of the service proposition. Our relationship with consumers is absolutely critical.”
Stores, he adds, are the most important part of maintaining
that and ensuring that Jaeger continues to be differentiated.
Premium shoppers have taken to multichannel shopping
like ducks to water – a third of online orders are via
click-and-collect at Jaeger, while mobile spending continues
to rocket. In 2012, 18% of online orders at Jaeger were
If you are at the
slightly more premium
end of pricing, you
have more tunes you
can play in a very
difficult economy
Peter Ruis, Jigsaw
completed on a mobile device – in 2013 this rose to 30%.
Ruis says this changing environment is exciting, but adds
it’s a challenge too. “There’s plenty of room to develop, but
you have to keep four or five plates spinning at the same
time. Maybe in the past it was one or two. You can’t let
your stores be average; you can’t not use all the digital channels.
You need a social media presence. There’s a lot of different
things to maintain.”
It’s not all about learning new retailing methods, however –
some of the problems facing premium retailers are old school.
One of these is the prevalence of discounting. Another reason
many of the premium players did so well this Christmas was
that they steered clear of the aggressively promotional environment that several mid-market players were part of.
Ben Perkins, head of consumer business research for
Deloitte, says: “Their [premium players’] performance this
Christmas crystallises the things that they do well, allowing
them to prosper. Typically they held their nerve and didn’t go
early to Sale when November had a slow start. This meant that
when the peak period came late, they had their stock. For me
that embodies that confidence in terms of their product, and
understanding who their customers are and what they want.”
Ruis says it was crucial to hold off discounting, but it’s not
easy to do so. “The big challenge is avoiding discounting. The
premium channels have become very discount driven. We were
aware of competitors giving an offer every week.”
It’s not an easy time for premium retailers, but they have
risen to the challenge. 2014 is likely to see many of them rising
even further. l
advice that our in-store experts deliver.
What role do stores play in The White Company’s proposition and strategy,
and how important are stores to the brand?
While The White Company originated from direct to home retailing and now
operates a highly successful ecommerce site, our stores are vital to the brand and
proposition, and strategy. More than half our turnover comes from stores. While
the role of the store is clearly changing, with an integrated approach to retailing
now needed across all channels to market, it is the stores that really allow us to
differentiate ourselves. It is the place where the theatrics truly take place; where
our customers get the chance to touch, smell and feel the quality of our product
and see our entire lifestyle proposition; and the place for human personal guidance and advice from our in-store experts. For now, at least you cannot do all
of that on an iPad.
What opportunities are there for The White Company in the UK market?
There is significant opportunity to grow further in the UK both with new store
locations and further online development, in addition to the obvious international
growth opportunity. In many parts of the UK we’re still something of a hidden
secret. There is a clear opportunity to recruit many new customers to the unique
The White Company brand, both here and abroad.
How do you see the brand and proposition developing?
We’re focused on making the shopping experience more integrated across each
of our channels to market. We want to make it easier for our customer to shop
how she wants, making the brand even more experiential across all customer
touchpoints. It will raise the bar even further on service levels and make interaction
and communication to our customers more personalised. All of this while obviously
further refining and improving the product we sell. spring 2014
13
Report
The
leisure
principle
Land Securities’ purchase of X-Leisure not only secured a prime leisure fund but
also underlined its view of just how increasingly important leisure is to retail-led
destinations. Mark Faithfull looks at what the deal means for the company’s portfolio
“
Leisure has become a vital part of any retail
destination,” reflects Polly Troughton, head of leisure
for Land Securities. “A good cinema and catering offer
extends dwell time, it creates hot spots, and it reinforces
the social and human experience of visiting a centre
and supports the retailing in that location.”
Troughton is in the ideal position to comment. Not only
has Land Securities significantly upped the depth and breadth
of its leisure offer in its shopping centres and retail parks, but it
has also snapped up one of the largest leisure funds in the UK
– taking it from a business without a dedicated leisure offer
to the UK’s largest owner of leisure properties, all within the
space of 18 months.
The X-Leisure Fund boasted about a dozen investors,
ranging from institutional funds and pension and life funds to
private equity investors and included two major stakeholders,
AREA Partners and Capital & Regional. Land Securities
Al fresco dining at
London’s West India Quay
14
spring 2014
established its own 12% stake on the secondary market, before
negotiating with the two largest shareholders to buy their
combined 42% holding, which included the management
company. In autumn last year, Land Securities acquired an
additional 35.6% interest in the X-Leisure Unit Trust for
£104m, taking its total ownership of the Trust to 95%.
In doing so, Land Securities acquired a portfolio of
16 schemes, totalling 3.1 million sq ft of prime leisure and
entertainment space. It includes Xscape in Milton Keynes
and Brighton Marina, encompassing cinemas, the largest
real snow slope in the UK and other sporting attractions
such as climbing walls, indoor skydiving and surfing.
There are also a host of family offers such as bowling,
entertainment centres, water parks, bars, restaurants,
clubs, health and fitness, bingo, urban and lifestyle retailers,
extreme sports retailers and coffee shops.
The move reflected two important objectives for Land
X-Leisure venues
n Xscape Yorkshire
n Xscape Milton Keynes
n Bentley Bridge
n Boldon
n Brighton Marina
n Cambridge Leisure
n Cardigan Fields
n Eureka
n Fountain Park
n Great North
n Lockmeadow
n Parrs Wood
n Queens Links
n Riverside
n Tower Park
Indoor climbing at
Xscape Yorkshire
n West India Quay
Securities – the first to mark itself out as a significant leisure
landlord in a market which has long-term growth potential;
the second to reinforce its leisure expertise in its traditional
malls, retail parks and designer outlets across the UK to boost
the customer experience and, consequently, the vitality and
success of those centres.
“In 2010/2011 we could see retailers’ growth slowing and yet
the leisure operators were bucking the trend,” recalls Land
Securities head of retail portfolio management Ashley Blake
of the initial move for X-Leisure. “When we looked at the
history of leisure in other downturns we could see that this
was a resilient sector and that we were also seeing cultural
changes in the way people liked to eat healthy food on the go,
the rise in casual dining and how people were becoming
increasingly time-conscious.”
While building its stake in X-Leisure, Land Securities was
also busy bolstering the leisure in its own retail schemes. The
most obvious fruition of this approach is at Trinity Leeds but
Blake points to a wider influence – starting with the influx of
cinemas into the company’s projects.
“It’s testament to how much things have changed that
securing a cinema operator anchor has become perhaps the
second or third priority when establishing a new scheme or
major extension,” he says. “Both Oxford and Glasgow will
have major new cinemas, as will Ealing [London]. We have
put a major operator into White Rose, while of course we
went with Everyman at Trinity Leeds, a unique, boutique
experience to appeal to the urban, chic crowd in Leeds’ city
centre. Not every project has to have a huge multiplex, some
of our schemes will work perfectly with a five or six-screen
cinema because the operators have become incredibly well
drilled at creating enticing offers for customers.”
Blake thinks this flexibility and the enduring appeal of
cinemas and the complementary food and beverage offers are
crucial in boosting the vitality and identity of shopping centres.
He points out how they can help shape flow, trading hours
and the image of a destination.
spring 2014
15
g
Report
The bar area at Maidstone’s Lockmeadow Hollywood Bowl
Milton Keynes:
what’s on
offer
n Snozone – real snow slope
nA
irkix – indoor skydiving
n Rock climbing
nC
ineworld – 16-screen
multiplex cinema
Indoor ski slope at Xscape Milton Keynes
n Hollywood Bowl – 18 lanes
nA
spers Casino
n Virgin Active – health and
fitness club
n 15 lifestyle, urban and sports
brand shops
n Bars, restaurants and cafes
n Wonderworld Nightclub
n Corporate events
n Special events
n John Butterworth Art Gallery
n Pay-and-display parking for
1,000 cars
Brighton Marina has a host of restaurants and bars as well as
a cinema and the largest real snow slope in the UK
“From a retailer perspective, I would be feeling nervous if
my landlord wasn’t putting in these offers,” he says. “There is
no doubt that shoppers are looking for the full package and
often a whole-day experience. Leisure makes for a much more
compelling experience and increases dwell as well as extending
trading hours, which will draw in more customers.”
By the time the X-Leisure team came within the umbrella
of Land Securities, the company had established a strong food
and beverage and cinema expertise of its own. The team,
under the auspices of Troughton, has been integrated into the
fuller Land Securities operation. Blake believes that this gives
the company a unique ability to help leisure operators transfer
into the retail space, and retail operators to move onto leisure
parks. “It’s not just about shopping centres,” he points out.
“We recently opened a Nando’s at Lakeside Retail Park and it
is trading very well.”
Indeed, Land Securities has established a diverse mix
of family catering offers on its parks, including Pizza
Hut, Subway, Costa, Starbucks, Nando’s, Ask, Chiquito
and KFC.
16
spring 2014
Brighton
marina: what’s
on offer
n2
0 outlet shops
n2
3 restaurants, cafes and bars
nD
avid Lloyd health and fitness
facility with gym, pool, sauna
and restaurant
n Rendezvous Casino – gaming,
dining and entertainment
nC
ineworld – eight-screen cinema
nB
owlplex – computerised bowling
n Neilson Active Holidays – sailing
options (including corporate
events, race days, sailing/powerboat courses)
n Hotel Seattle
n Special events
n F ree parking for 1,500 cars
Troughton joined Land Securities from X-Leisure as part
of the acquisition of the management team and, as head of
leisure, is leading integration of her team in the company. She
also notes the rising popularity of leisure and adds: “At a time
when retail was struggling, we had very low void rates, long
leases, high demand, and people still spending.”
The X-Leisure team is not only working on that portfolio
but also providing advice and expertise across Land Securities holdings. “It’s early days,” she explains. “However, with a
busy pipeline we’re helping to guide the leisure strategies in
places like Oxford and Glasgow, while looking at the strategies to develop the existing estate and any new acquisitions.”
Troughton believes that the overriding recent trends – the
general rise of food and beverage, the expansion of casual
dining and the inflow of new concepts – will continue,
especially as out-of-home eating occasions continue to rise.
“But what we do see is that the experience of eating at a retail
destination is very different, because it’s part of a day out,” she
says. “As a result we foresee that more of those eating experiences might involve say making your own pizza, or preparing
and cooking your own food under guidance – so that it is more
of a participatory event.”
She also notes that not everything has to be about newness,
noting the revival of the TGI Friday’s brand through its
dedication to hospitality and customer services. “They have
created a unique experience and increasingly that’s what the
customer is demanding,” she says.
Perhaps the most complete culmination of this new direction for Land Securities could be at London’s O2 Arena in
Greenwich. The company is in talks about the possibility of
developing a designer outlet adjacent and, while nothing has
yet been determined, Troughton reflects: “We have been able
to hold discussions because of the reputation we have built
around our own leisure proposition and experience. There is
the potential to provide retail, food, leisure and entertainment
all in one package – it’s what the future is all about.”
What seems clear is that the momentum behind leisure as
an increasingly important element of retail-led destinations
continues. There is a fresh generation of healthy, quick service
and family restaurant offers coming to market and new
takes on family activities from bowling and skating to
cinema and education-based fun. “The operators have become
very sophisticated and despite the discretionary nature of
leisure, consumers’ enthusiasm is showing no signs of letting
up,” says Troughton. l
Development
a
v
o
N
r
Supe
The final piece of the Victoria master plan will arguably be the best yet, as
Nova rises to provide a vibrant dining and cultural destination that encourages
people to spend time rather than pass through at pace. Mark Faithfull reports
L
ondon’s Victoria – previously known
for its bustling rail terminus and home
for many of the Government’s civil
servants for several decades – is rapidly
transforming. While the complicated
assemblage of some huge real estate –
ostensibly in the area directly next to Victoria station and
towards Westminster along Victoria Street – went along
comparatively quietly, the launch of Nova has now put
Victoria centre stage.
The sheer scale of the development has enabled Land
Securities to put in place a master plan to create the
missing “sense of place”, says David Atcherley-Symes,
retail leasing director for Land Securities, which will give
Victoria a renewed sense of purpose and prominence.
That ambition is to be realised by the ongoing construction and refurbishment of a series of tired office blocks, a
number of which have been vacated by Government
departments. The new buildings will provide world-class
offices, a carefully constructed mix of retail, restaurants,
cafes and bars, a revitalised streetscape and public realm,
and beautifully crafted residencies.
With an all-star cast of Google, Microsoft, Channel 4,
Tom Ford, Richemont, LVMH and Burberry all making
the area home, Land Securities wants Victoria to retain its
own ambience. It scored a public relations coup when
iconic footwear brand Jimmy Choo signed up for a head
office at 123 Victoria Street.
In its original guise the flow ran along a corridor
between Victoria and Westminster but with the new developments Land Securities is creating flows to the north and
south, which will help to increase the throughput of people
further into Victoria encouraging them to discover the
area’s hidden gems and historical side streets.
Land Securities also believes that its redevelopment
work will act as a catalyst to attract independent retailers
and further regeneration around its own projects, creating
a fresh central London district.
spring 2014
g
17
Development
Because of that diversity, Atcherley-Symes envisages
that the food offer will be equally diverse, including chef-led
restaurants, casual family dining and eateries catering for
meal occasions throughout the day. “In a location like
Nova, Victoria it’s just as important to be able to get great
scrambled eggs on toast in the morning as it is to eat a
great steak in the evening,” he stresses. “Over the past few
years London has become the food capital and we’ll be
looking to bring some fantastic brands and names to cater
to all requirements, both from the UK and abroad. They
will be contemporary names, which can create enticing
environments and that will take the whole food and
beverage offer on.”
Thomas concurs: “What we’re seeing now is the
emergence of some fantastic healthy fast-food options
and the real focus on providence – from farm to fork –
plus some terrific independents. Traditionally independent
operators have struggled in major developments
but that is changing. The owners are becoming very
sophisticated and many of them are backed by investment
money – so the issues of covenant and financing are
becoming less difficult.”
Nova, one of the developments in the Victoria area,
comprises a 5.5-acre island opposite the main entrance to
the station. It will include three buildings comprising
offices, retail and residential accommodation. Atcherley
Symes says: “It’s the biggest component in the best
position, we’ve been saving the best for last.” It will see
redevelopment focus immediately around the train station.
Phase 1 is due for completion in 2016, while phase 2 is to
start following completion of the London Underground’s
North Ticket Hall works in August 2016. Phase 2 will
comprise offices, a library, 35 apartments and 11,000 sq ft
of retail, and is due for completion in 2018.
Game changer
Land Securities and its joint-venture partner for the Nova
development, Canada Pension Plan Investment Board
(CPPIB), has pulled no punches. It has declared Nova as
the defining moment in the £2.2bn reinvention of Victoria
and as a game-changing, 897,000 sq ft scheme delivering
high-profile retail, cafes and restaurants and 16,000 sq ft of
community space.
The transformation of this site is designed to deliver a
new seven-day destination that will encourage the 115
million people who use Victoria station each year to engage
with this part of the West End. Along with the five
landmark buildings, Nova, Victoria will deliver a significant new public and cultural space, with evolving
public art and outdoor dining. It will link Victoria station
to the tourist destinations of Buckingham Palace and
St James’s Park.
“Nova is undoubtedly the pinnacle of our regeneration
of Victoria. What is important is that the public space is
awe-inspiring and yet not overwhelming. It sits below bold
architecture and it is about the sense of place and experience,” says Catherine Thomas, head of marketing for the
London Portfolio. “If you look at the lead employers, they
know that the recruitment and retention of talent is
becoming increasingly difficult in London and many of the
new recruits are not interested solely in remuneration but
in the lifestyle, corporate pride and ethos of the businesses
they work for, which is why creating this lifestyle offer at
Nova is so important to dovetail with the commercial
space that sits above.”
The work in itself is a boon for the area’s traders. More
than 800 jobs are expected to be created during demolition
and construction. When completed and operational,
Nova, Victoria will be home to more than 5,000 workers,
residents and retailers.
Land Securities also wants to celebrate the intrinsic
cultural identity of Victoria, not just its new additions. As
Thomas stresses: “What is worth remembering is that
there are plenty of hidden gems in Victoria. So aside from
creating new developments we’ve been working to try and
highlight those and to retain the heritage and historical
links with the area’s past importance.”
To support the marketing of its residential Land Securities has launched a new sub-brand ‘Residential by Land
Securities’ in November. The Nova Building, Nova’s
18
spring 2014
A view to remember
master plan:
PLP Architecture
Our master plan and designs for
three new commercial buildings
with retail space will regenerate the
island site to the north of Victoria
station. It ensures cohesion across a
series of buildings designed by three
leading architectural practices.
The master plan forms the largest single-planning consent from
Westminster City Council to date.
The project creates a well-designed
urban environment, enhancing the
public realm and architectural
quality of the area.
The development contains a
sustainable balance of uses, including offices, retail, apartments and a
community space/library. Pedestrian
routes and public spaces extend
across the site, with a north-south
thoroughfare with retail pavilions,
cafes, restaurants, public art, trees
and seating will become a public
space to host events. An east-west
route accentuated with a water
rill and planting leads to a more
intimate space enlivened by a
water wall.
residential element, currently for sale, has proven extremely
popular with both investors and occupiers who have been
drawn to its Buckingham Palace Road address and
its proximity to key London landmarks and beautiful
Royal Parks.
Some 170 studio, one, two and three-bedroom, ultramodern apartments and penthouses are to be completed in
2016 and will offer amenities including concierge services,
a rooftop garden overlooking Buckingham Palace, a
private cinema and gym.
The blend of residential, domestic and international
tourists and working communities will be key to creating
the vibrancy for which Land Securities is striving. It
intends Nova, Victoria to become home to a constellation
of coveted brands, new and old, that push the boundaries
of the shopping and culinary experience. A cluster of inventive and inspirational restaurants, eateries, pop-ups, bars
and retailers that create an unmistakable buzz – a microcosm of the best of London in the heart of Victoria.
“We’re looking at a collection of 18 units on the ground
and first floors of three buildings, two of them commercial
and one residential,” says Atcherley-Symes. “Having
considered the offer in and around Victoria, we believe that
the emphasis should be on food to create something
that Victoria simply hasn’t had before.”
The rationale behind this strategy is based on the
competing and established fashion zones in close proximity
to Victoria, including the King’s Road, Knightsbridge, the
West End and Bond Street. Land Securities did not want
to replicate those offers and thought a food and lifestyle
provision would best serve the broad mix of visitors to the
area. “Although we felt a new fashion destination could be
established, even in a mature market like London, this
typically takes a long time. What really came across from
the stakeholder research was the lack of a good-quality
food and beverage offer in the area,” says Thomas.
That point is taken up by Atcherley-Symes, who
says: “Victoria has a very mixed and very desirable
catchment. On our doorstep we have the Belgravia,
Pimlico and Victoria residential areas, we have
commuters, the workforce, tourists visiting sites such as
the parks and Buckingham Palace and, of course, theatregoers. We have three theatres around us and we have
signed a deal to bring a Curzon cinema into one of
our other buildings.”
Along with the five landmark buildings,
Nova, Victoria will deliver a significant new
public and cultural space, with evolving
public art and outdoor dining
Also crucial to making Nova, Victoria a must-visit destination will be the landscaping. Atcherley-Symes says Land
Securities aims to create a “softer” ambience. That means
lighter-coloured, hard-landscaping, trees, plantings and
greenery and seating to create a calm and human-scaled
public space.
“We’re conscious that the food and beverage offer will
sit below three quite tall buildings and we don’t want
them to feel imposing. We want the whole area and the
dining experience to feel in tune with why people are
there,” says Atcherley-Symes. “We’ll also be bringing in
markets, exhibitions, music and art to the public realm,
which is a key part of the post-opening management of
the scheme.”
For now it is a balancing act, admits Thomas, between
rushing ahead full-steam and holding back to ensure that
Nova presents the best of the best when it opens. “When
we developed Cardinal Place we brought in the great
operators of the day such as Zizzi, Nando’s and La Tasca.
But for Nova – although those operators continue to do
a fantastic job – it is about bringing in the next generation
of food offers,” she says. “In some ways it’s what makes a
development like this so challenging, because on the one
hand we want to get on with the leasing, on the other we
have to balance the fact that delivery is still in the future
and that we want the cutting-edge operators of that time.
It’s also what makes these schemes so exciting.”
“When we look at the success of the food and beverage
offer at Trinity Leeds, I think it has surprised even us just
how enthusiastically those brands and food offers have
been embraced by the local catchment. This is certainly
not a Southeast phenomenon,” reflects Atcherley-Symes of
the strategy. “At Nova we want to do something really
special, it will be a dramatic change.” l
spring 2014
19
Report
foodie
The
generation
As attitudes to food and dining undergo seismic shifts, restaurants and eating
destinations are rapidly adapting to new trends. From increasingly popular niche
cuisines to innovative formats for places to eat out, a new dawn has risen on the
leisure experience. By Alex Lawson
I
n the past few years, the UK’s behaviour towards
food and eating out has changed beyond measure.
A resultant ‘foodie’ generation has emerged.
Consumers are more eager to try new and different
cuisines, inquisitive about the food’s origins, and
ready to tweet about their consumption before the
last mouthful has even been digested.
This has presented new challenges to restaurateurs and
landlords alike. Where once a restaurant may have competed
against a rival down the street, now several restaurants
offering the same cuisine may be available in a single town,
alongside a popular street food market and a host of online
food delivery services.
The shift comes against the backdrop of a consumer under
financial pressure who, while their purse strings may have
been loosened somewhat since the economic downturn’s
nadir, are still careful about every pound spent.
But the restaurant landscape offers plenty of opportunity.
The flying start enjoyed by traders at Trinity Kitchen in
Leeds, a first in the UK street food market that opened in
October inside Land Securities’ Trinity Leeds shopping
centre, shows that innovation is alive and well.
Land Securities leasing manager Andrew Turf, who
worked on the Trinity Leeds project, explains how shopping
centres in the future could have a distinctly different approach
to its food offering. “The whole shopping centre model of
ground and first-floor retail and the top-floor restaurants is
archaic, boring and predictable,” he says. “You can have far
more interesting options where you incorporate food and
beverage throughout a centre. In the future, you could have
a restaurant anchor tenant and build around it,” he says.
Innovation has also been key at the St David’s shopping
centre in Cardiff where Land Securities has broadened the
centre’s offer by hosting Bar 44’s mobile tapas concept – an
airstream trailer serving Spanish food from a pitch outside,
which hopes to capitalise on the popularity of street food.
20
spring 2014
But it’s not just in formats that stakeholders are having to
tweak their offers to suit a changing consumer. Eateries are
becoming more savvy in their marketing exploits from using
smartphone location services to offer customers deals to
providing wi-fi to increase dwell time in cafes.
Moreover, a trend towards convenience food shopping is
echoed in the food-on-the-move market where brands such
as Eat and Pret A Manger have expanded rapidly as timepressed consumers seek a quick fix.
Innovative restaurateurs may also look to London’s trendy
Shoreditch for inspiration from two off-the-wall projects.
Russian cafe chain Ziferblat, which has opened in the east
London hot spot, asks customers to pay 3p a minute to hang
out but its food and drinks are free. Up the road, the muchhyped, crowd-funded project Lady Dinah’s Cat Emporium
opened at the beginning of March with a troupe of feline
friends to offer company for customers.
CUSP OF A WAVE
If formats and eating habits are changing quickly, then it’s
nothing compared with the lightning pace at which new
cuisines are being adopted in the UK.
One cuisine poised to explode in 2014 is Brazilian food.
Buoyed by the FIFA World Cup, the South American
culture, including its national dishes, is likely to take off.
Mintel’s Consumer Trends 2014 report predicts that the
football tournament “is going to make the world fall in love
with all things Brazil”.
“It has not hosted a World Cup since 1950 and, this time
around, the showcase of Brazilian commercial cultural
exports will encompass everything from food and fashion to
beauty products,” writes Mintel senior trends consultant
Richard Cope.
Cope adds that Brazilian meat and Churrasco grilled beef
restaurant brands such as Rodizio and Braza have the potential to appeal to the 60% of UK consumers who have not but
BURGEONING
BRANDS
A number of brands are eyeing
significant expansion or have the
potential to grow exponentially. A1
looks at some of the front runners.
nC
eviche This Peruvian kitchen
and Pisco bar in Soho has
taken London by storm and the
concept was taken on a tour
of Britain last summer to great
(Clockwise from top left) Chicago Rib Shack, Tortilla, Yo! Sushi and
Pho are enjoying a rise in popularity as consumers embrace new
formats and cuisines when dining out
approval.
nP
izza Union This Italian in the City
of London offers stunning value
for good-quality pizza, capturing
the eye of cash-strapped Britons.
n T ortilla The Mexican brand,
which features in Trinity Kitchen,
could easily ride the wave of
popularity for burritos and central
American food, with plans to
expand this year.
nK
eu The growing trend towards
Vietnamese food may play
into this four-restaurant chain’s
hands, which has a branch in
London’s Vietnamese hub in
Old Street.
n T he Alchemist This cocktail bar
from leisure firm Living Ventures
also features an array of cuisines.
The 40-restaurant group hopes to
expand into the South and plans
to open The Alchemist in the City
in May. It also opened its bar in
Trinity Leeds in March last year.
would like to visit a South American restaurant, according to
Mintel research.
Serial restaurant investor Jamie Barber plans to roll out
his Brazilian barbecue format Cabana and open new South
American brasserie Hush this year as the cuisine rides high.
Meanwhile, neighbour Argentina will continue to charm
British consumers as brands such as steakhouse Gaucho
expand and Santa Maria del Sur continues to be a standout
destination in Battersea.
Looking East, Vietnamese is another cuisine enjoying a
rise in popularity. Pho, a brand that takes its name from
Vietnamese pho noodle soup, has nine restaurants, predominantly in London. Buoyed by £5m investment in 2011, it now
has seven restaurants in London, one in Brighton and one in
Trinity Leeds. It plans to open four new restaurants this year
as well as capitalising on the success of its first branches
outside the capital to take its offer to two new restaurants
outside London in 2015.
Co-founder Stephen Wall explains the brand has a strong
niche. “We’ve got little direct competition, which considering
the popularity of specialist pho restaurants in the US in
particular is a surprise,” he says. “There’s been a good handful
spring 2014
21
g
Report
of traditional Vietnamese restaurants in London for some
time, but over the last year or so the trend has leaned towards
Vietnamese grab-and-go places in areas such as the City.”
Wall adds that Land Securities’ schemes prove an attractive proposition. “They are great locations, well managed
with a good mix of tenants. Land Securities is one of Britain’s
foremost landlords and quite simply has some of the best
opportunities for a restaurant such as Pho,” he says.
Another key trend set to step up in pace in 2014 is towards
healthier restaurants. Wall argues that health has shot up the
agenda and “nutrition is becoming a hot topic”.
Yo! Sushi chief executive Robin Rowland agrees. “What’s
clear in terms of an underlying trend is that people are eating
more healthily in the round. It’s not just the middle classes,
everyone is thinking about the amount of sugar and salt in
their diet in a way they didn’t 10 to 20 years ago,” he says.
Turf adds: “In London new openings will be more specialised towards healthy food. People expect more health information and local products, as there is more attention on the
provenance of products. Elsewhere in the UK, people are
more value conscious and it will be about offering people
rewards this year.”
There is little doubt the UK’s restaurant scene is in rude
health. With a wealth of new cuisines and cultures set to
explode on to British shores, landlords will have to move
quickly to harness growing trends in 2014. The foodie generation has truly been borne, but the question is what will
foodie boomers’ children be eating in a few decades’ times. l
It’s a different
experience in a
shopping mall, it’s
always semi-leisure.
People need a pit
stop if they are
shopping for twoto-three hours
Robin Rowland, Yo! Sushi
Mexican street food restaurant Tortilla
Trinity Kitchen
One of the most significant shopping centre food
developments of the last year was the opening of Trinity
Kitchen in Leeds. The concept aimed to bring a first to
mall dining by channelling a street food environment
into shopping centre space. The inventive format aims
to showcase local and national cuisines alongside
major international high street food and drink brands.
Trinity Kitchen, which opened in October, brought
cooking demonstrations, street food vendors and popup market stalls into a shopping centre environment.
It tempted brands including Notes, Pho, Tortilla and
Chicago Rib Shack north for the first time.
The dining area receives 35,000 to 40,000 customers
a week. Land Securities leasing manager Andrew Turf
explains the brands are “trading London-type numbers
from smaller space in Leeds”.
“We are learning a lot about food and food trucks and
Yo! Sushi
the explosion of food culture. It’s become a great success
and I think the traders are trading fantastically well,” Turf
The Yo! Sushi story is one as bite-size and charming
says. “I think food retail and experience is where it’s going
as the products that travel its conveyor belts. First
because you can’t buy a food experience online and
opening in Soho, London in 1997, the UK’s first
people want to check out the latest restaurant scene.”
sushi chain wowed customers with its product
Turf adds that influences for the project came not from
offer and unusual dining experience to open
shopping centres but from innovative markets in New
76 restaurants worldwide.
York, Hong Kong and Chicago as well as developments
But the business is entering a new era with brand
extensions and international growth – it has even
such as Brixton Village in London.
But creating Trinity Kitchen was no small feat and came
considered delivering meals by drone but an ill-
with plenty of logistical and psychological hurdles. “At
fated pilot made a near-term repeat unlikely.
Trinity Kitchen they hoist food trucks in and out every four-
Of its 67 UK restaurants, some 35 are in shopping
to-six weeks, which is a challenge,” explains Turf. “We had
centres and they are locations the brand performs
to maintain a can-do attitude throughout the process but
well in, chief executive Robin Rowland explains.
we got there in the end.”
“In our case we have carefully targeted the top 30 shopping malls in the country. Everyone
Turf also believes the development can be replicated
said the advent of the internet would hit shopping centres and it’s impacted spending on
in areas that are not metropoles. “I think Trinity Kitchen
retail but eating out has held up,” he says.
could be rolled across the world from Shanghai to
“It’s a different experience in a shopping mall, it’s always semi-leisure. People need a pit
Stockport. You do not have to commit the same capital
stop if they are shopping for two-to-three hours. Our core customers are CBD [central business
expenditure so you bring down the cost and prices so it
district] and are still aligned to food that’s in fashion.
could be successful,” he says.
“We’ve just had a great Christmas, which was ahead of expectations as the appalling
“You just have to bring in the local specialists. There
weather made people go to shopping centres, which have inundated their space with food
are plenty of people who would like something different
offers. Luckily we’re highly differentiated but it’s tough if you just have a standard offer.”
in every town. If you provide them with the environment
Rowland explains that the franchise brand is a versatile shopping centre tenant. “We can go
you do not have to be financially tied down. If you’re
anywhere,” he explains. “We can put Yo! Sushi in the middle of Bluewater as we’ve devel-
bold there’s no reason it can’t work, but it has to be from
oped a model, which does not need walls and extraction. We’re also good at food on the
the people of Stockport for Stockport rather than ‘for
move and have about a dozen restaurants in railways and airports.”
Stockport by London’.”
22
spring 2014
Report
Shopping
studies
Students are swapping beers for bargains as retailers tap into the
fashion-hungry youth with student lock-ins taking place as a national franchise
in shopping centres. Tiffany Holland reports
W
ith more than 2.5 million
students in higher education
in the UK, student lock-ins
at universities are a clear way
to attract a captive audience.
Land Securities was one of the
pioneers of a craze that has become a consumer marketing
phenomenon. The events entice students to shopping
centres brimming with cut-price offers from retailers,
which aim to start what they hope will be a long relationship with the brand.
So just how valuable have these large-scale marketing
events become in terms of sales and loyalty, both for retail
schemes and the retailers within them?
Usually held once a year in the autumn, the three-hour
lock-ins are designed to welcome the students at the start
of their new teaching years. While primarily targeted at
first-year students, they also serve as a loyalty reminder to
those older students who have been before.
In 2010, Land Securities held its first lock-in event at the
St David’s shopping centre in Cardiff, which has one of
the UK’s largest student populations, making up a fifth
of the population. This first event generated £166,000 of
revenue, so the opportunity for growth was apparent from
the start.
Suzi Arkley, head of consumer marketing for Land
Securities, says: “We noticed that some retailers already
saw the value of this core demographic. By scaling up the
activity to accommodate the whole shopping centre, we
realised we could create even more excitement for local
students and, in turn, generate a greater impact for our
retailers.” Four years on and Land Securities’ student
lock-in has grown to 10 centres, involving 550 retailers and
100,000 students and netting £2.6m in revenue.
UK retailers have, for a long while, recognised the value
of engaging with students. Many retailers offer student
discounts throughout the year, but the lock-ins offer a
more concentrated opportunity. And, with about 440,000
spring 2014
g
23
Report
students living within the catchment area of Land Securities’ participating centres, it has a clear business case
behind it.
SuperGroup head of retail Claire Arksey says: “Students
are obviously our main core customer and it allows us to
focus and target a lot of students at once and help introduce them to the brand.”
SuperGroup has been involved in the lock-in idea from
the beginning and took part in almost 60 events last year.
This is despite the group’s no discount strategy – the
lock-ins are the only time Superdry cuts prices and, at a
generous 20% off, students queue out the door to get their
hands on a bargain.
“As a brand we don’t discount so it was always going to
be a concern,” says Arksey. “But I think what we’ve tried to
do is not just offer a discount. We also put DJs on, ensure
the team are engaging with the students and we do it just
once a year.”
For such an important event, the retailers go all-out
to entice the students in the hope they will keep coming
back throughout their student life and beyond into
professional careers.
Their offers are varied. Land Securities’ Arkley says
health and beauty retailers such as Boots offer makeovers,
while lingerie retailer Boux Avenue offers shoppers a glass
of bubbly as they browse. At one Trinity Leeds event,
footwear retailer Office enlisted the help of local artists to
personalise footwear for customers.
“It’s about discounts and bringing life to stores. Retailers
need to get into the spirit of the whole evening. And we
know that dwell time is linked to spend,” Arkley adds.
And this marketing technique is not just the domain of
those brands more typically associated with the student
demographic. Those with higher price points such as
Vivienne Westwood, Cath Kidston and jeweller Swarovski
are also engaged with the events. The latter, for instance,
proves particularly popular with international students
because of the lower UK prices.
But, of course, effective marketing is critical. Success
does not depend entirely on word of mouth. Land Securities enlists help from event agency Total Students, which
specialises in organising the events, and creating the
atmosphere and buzz unique to a student lock-in. On
the night, amid the music and party atmosphere, queue
management systems are designed to safely stagger the
swarms of students, while health and safety, cleaning and
security are also taken into account.
Effective implementation requires promotion across
multiple channels, starting with student venues. Flyers and
posters are on display in student unions, fresher fairs, halls
of residence and local bars and clubs. Social media and
email marketing campaigns are also a priority, and these
prove to be a highly cost-effective way of ensuring success
– particularly given this age group’s high engagement with
social media and digital channels.
The retailers in the centres contribute half of Land
Securities’ marketing budget, so it is a combined effort.
SuperGroup’s Arksey says it is crucial that the shopping
24
spring 2014
Schemes involved and
2013’s facts and figures
Retailers’
endorsements
Overgate, Dundee 4,500 students, £169,575 sales Buchanan Galleries, Glasgow 6,678 students,
£185,070 sales Bon Accord & St Nicholas, Aberdeen 4,391 students,
£107,000 sales Tonight has been
a resounding
success for us – with
sales up six times
compared with a
usual weekday. As a
high-end brand and
the biggest Vivienne
Westwood store in
Europe, we attract
a lot of international
students, firmly
placing Cardiff on
the retail map
Vivienne Westwood, St David’s
Shopping Centre, Cardiff
The store completely
exceeded target and
we were incredibly
impressed with how
much the centre
pushed and supported
the event
Superdry, Trinity Leeds
Trinity Leeds 19,914 students, £565,000 sales The Bridges, Sunderland 9,100 students, £178,000 sales (Clockwise from top left) Superdry’s store at St David’s in Cardiff;
street food on offer at Princesshay in Exeter; St David’s creates
buzz and interest for students at its lock-in; hordes of students
queue at St David’s lock-in in Cardiff
Student lock-ins: the
best approach
l The events aren’t simply a way to get people through
the door via discounting. They work best if retailers offer
create a buzz and interest them in your brand long term?
l Promotion is critical. Consider how you can spread the
word via social media, leaflets and so on.
2010
Revenue £166,000
Retail brands 51
2013
Total students 103,000
Revenue £2.6m
Retail brands 550 retail brands
St David’s, Cardiff 27,222 students, £672,035 sales Gunwharf Quays, Portsmouth 4,335 students,
£129,190 sales Cabot Circus, Bristol 19,400 students, £442,206 sales centre has good links with the local universities and, in
turn, the retailer has a good relationship with the centre.
“We’ll look at [the shopping centre’s] social media and
how many followers it’s got and check if it’s got a really
good website because students are on there all the time,”
she adds.
Schuh head of store operations Phil Whittle adds: “It is
completely dependent on the marketing effort. We’ve had
shopping centres that didn’t do lots of marketing and it
didn’t work.
“We have been actively out there and we actually took
the message to the centres and asked them to look at it.”
Schuh participated in 50 student lock-in events last year,
which were broadly a huge success for the retailer. Whittle
says they can be so successful that a store will take more
cash in an hour at a student lock-in night than any hour
over the usual Christmas peak, even with the 20% discount
the retailer offers in store.
“It’s the biggest discount we ever do,” Whittle says. “We
offer students 10% off anyway so we’re effectively doubling
their discount for coming. And they’re very prepared to
extra value to students. What experiences can you offer to
in numbers
Princesshay, Devon 3,695 students, £117,370 sales l Talking to centre teams to find out creative ways to
draw attention to your brand. They could offer extra
space in the mall for animation, for instance, or additional
sales points to showcase your offer.
l Lock-ins are a great opportunity for collaboration and
cross-promotion. Consider opportunities to work with other
retailers or caterers.
l For retailers interested in getting involved, email
[email protected]
The Galleria, Hatfield 3,514 students, £76,559 sales come and stand in queues that go right the way out the
shop. We try to tackle them with handheld tills but they’re
the longest queues you’ll ever see in our shops.”
But with increasing university fees and a recovering
economy, how do students have the money to spend?
Land Securities’ Arkley says: “Students still spend on the
items they want and need, though perhaps the choices they
make have changed over the years. With increasing financial pressure, students look for money-saving offers, an
experience and, ultimately, value for money.”
Whittle says students plan their purchases before they’ve
even left their halls of residence. “It’s not just impulse.
Students are very savvy. We have check-and-reserve where
you can put shoes on hold for 48 hours. It means that we
can tell you how busy we’ll be by 1pm that afternoon.”
So now that student lock-ins are a real date in the diary
for retailers and students alike, the pressure is on to keep
the events fresh. Land Securities is targeting brand
involvement to offer more entertainment and experiences
unique to the night.
Arkley reveals that Land Securities is even trialling
different events this year following the student success.
These include an event in April that will focus on the
female demographic and a food-focused promotion in
the summer, while it is also looking into how shopping
centres can pull in Christmas sales earlier this year with
a pre-Christmas event.
But it is unlikely Land Securities will increase the
frequency of its student lock-ins owing to the strength of
the autumn timing, although other centres including
Trinity Leeds and St David’s have held smaller springtime lock-ins.
These events are far more than just a fun PR opportunity. Their business value in terms of sales is tangible
evidence of the importance of developing strong customer
relationships. The term ‘lock-in’ is particularly appropriate
– give the customer a first-class experience of your brand
when they are young and you are locking in their loyalty
and spend for years to come. l
spring 2014
25
Development
big thing
The next
Land Securities has teamed up with
TrueStart – a venture to find real
talent in retail. By Ben Cooper
F
or any business to get started in this world
it can take many things: guts, hard work,
luck, or a combination of all three. But,
sometimes, you get a helping hand. That’s
exactly what TrueStart – backed by Land
Securities – is all about.
The brainchild of Matt Truman, chief executive and founder
of specialist asset management company True Capital,
TrueStart is about giving young, fledgling tech companies
with big ideas the chance to be retail’s next big thing.
The project has just been born in a new purpose-built
office space in Land Securities’ Francis House in Victoria,
London. A groundbreaking venture, TrueStart’s hub differs
from other entrepreneurial centres in the UK, because it will
specialise in nurturing retail talent alone.
Bright young lights with ideas to change the way retail
works, from the shop front to the warehouse, have been
selected, and now they are ready to begin.
The chosen few will be given rent-free, rate-free desk
space in the 4,300 sq ft office, where they will work for
the next six months, with the added bonus of £25,000
investment from True Capital for a 10% stake in their
new business venture.
With 20 small businesses taking space in the hub every
year, each gaining expert advice, financial backing and a
wealth of retail connections thanks to Land Securities’ extensive contact list, it’s set to be a melting pot of activity and
talent that veteran city banker Truman says could produce
true, radical change in retail.
“The ideas can come from anywhere,” says Truman. “From
field to shelf, from supply chain technology to data analytics.
At this point they’re all different and at different stages.”
The past five years of downturn and a subsequent lack of
lending have been tough on small businesses looking to get
off the ground. Financiers run for the hills, risk is shunned
and innovation can grind to a halt. A hard enough task in the
best of times, getting funding for a new idea, however
brilliant, has been too hard for many.
Now True Capital hopes to go some way to solving that
problem for a lucky few. Under the guidance of True Capital
partner and Cushman & Wakefield global head of retail
John Strachan, Truman approached Land Securities with
the idea in March last year.
Truman says: “We went to Land Securities for its reputa-
26
spring 2014
tion, as well as its excellent relationships with retailers and
unrivalled scale across the UK. It became apparent its
partnerships were going to be key, and the idea that they
could provide a wide range of mentors into the hub.”
A win-win situation
Land Securities got behind the scheme and the wheels
began turning. Now, less than a year later, the office has
been turned into the perfect hub, with shared space for the
small teams to work in, cutting-edge technology and a giant
screen for presentations and collective idea making.
Land Securities head of b2b marketing and brand partnerships Sean Curtis says: “The hub creates a unique opportunity for us and our retail partners to access retail innovation,
a chance for our key staff to work with entrepreneurs and for
the fledgling businesses to benefit from direct access to a
FTSE 100 company – in short it is a win-win for everyone.”
Budding entrepreneurs are being invited to first fill out an
online application, which leads to a second stage at which
the TrueStart team and their Land Securities counterparts
choose a selection of the original hopefuls to progress to the
third and final phase of the process.
With about 20 to 30 applications a week under consideration, and this rigorous process to go through, the hub,
headed by music and publishing veteran Richard Mergler, is
only for the serious entrepreneur, however far along the
journey they are. Truman says the key is that they are
passionate and willing to make the most of the opportunity.
“Some will be at the beginning, others will be three
quarters of the way there – there is no stereotypical entrepre-
VICTORIA – LONDON’S
NEXT CREATIVE QUARTER?
The area has already attracted some big names from the
tech, media and retail worlds, with Microsoft, Channel 4,
Burberry and Jimmy Choo among the companies in the
neighbourhood.
Key to attracting the talent will be the major 897,000
sq ft mixed-use Nova scheme by London Victoria station,
which Land Securities is developing jointly with Canada
Pension Plan Investment Board (CPPIB).
neur. We want people who live their business, we want to
make them comfortable and we want to build relationships.
“We’re investing in them as well as mentoring them. It’s
important that we’re all aligned,” he says.
One of the challenges, Truman adds, is not finding the
right advice to offer. With his background working for big
City firms including Deloitte, Lehman Brothers and JP
Morgan, and the rest of the TrueStart team all specialist
asset managers, there is plenty of wisdom. The challenge is
finding the balance between nurturing but not smothering,
and helping but not compromising the entrepreneurs’ ideas.
Young, fledgling tech companies will
be given rent-free, rate-free desk
space in the 4,300 sq ft office, where
they will work for the next six months;
True Capital chief executive
and founder Matt Truman (above)
Project focus
So apart from the financial backing and a space to create,
part of the goal of TrueStart, he explains, is to overcome one
of the big obstacles of all new businesses. He says young
chief executives can often spend far too much time hunting
down investment and too little on the project itself. And
while they’re pitching to potential backers, nimbler rivals are
working away and often getting ahead of them.
Not only will TrueStart save them that stress, but for
those selected they are given a working relationship with
their backers beyond their six months at the hub. And if the
right connections are made while they are in their new
environment, partnerships between entrepreneurs might
even be formed.
The TrueStart project fits into a grand plan for the area:
to make Victoria a ‘creative village’ and a hub for retail
innovation in its own right. It will cultivate innovation for
the whole industry and across the UK.
Land Securities is investing about £2bn in Victoria, which
it says has been undernourished and is ready for a new lease
of life (see box). While London’s East End is busy making a
name for itself as a home of artists, designers and web developers, Land Securities wants the West End to be known for
world-class retail innovation. Truman says: “Retail has
always been based around the West End – the East is very
tech-centric, not enough of it is retail-focused.”
Like all good business deals, TrueStart is meant to be a
win-win. As technology is becoming more vital to retailers,
the next game-changer could be just around the corner.
With the hub, True Capital and Land Securities hope to
not only nurture, but discover and get behind the big new
things in retail technology to maybe one day roll them out in
their own centres and to their occupiers.
Curtis adds: “Retailers want a landlord to be innovative. A
lot of the big landlords spend a lot of money on consultancy
for innovation; we’re creating an environment for people to
innovate in. The more we invest in innovation the more we
can be a promoter of change for our retailers.”
But that is still some way off. For now the project is
taking its first crucial steps. Maybe not all the 20 businesses
a year going through the hub will change the world, but
they will have had the best possible start. And for those
with the ideas the retail world is waiting for, their time is
just beginning. l
spring 2014
27
Report
Sainsbury’s opened its first Local in Hammersmith, London,
in 1998, the retailer says only 6% of the population lives within
a 15-minute walk of a Local store so there is scope for many
more openings. Sainsbury’s set a target of opening two new
convenience stores a week during 2013/14 and has opened 73
so far this financial year.
According to grocery industry body IGD, the value of the
UK convenience sector will rise to £46.2bn by 2018 compared
with £35.6bn at the moment.
Sainsbury’s convenience director Simon Twigger says the
convenience market has been growing at about 5% a year, so
there is “a massive opportunity to take a share of that growth”.
Top-up shop
The new
space race
Changing shopper
habits are creating new
opportunities for retailers
when it comes to opening
new stores and expanding
their space.
By George MacDonald
28
spring 2014
T
he future and form of retail space has
been one of the most hotly debated
themes in the industry in recent years.
The advent of online shopping and rise
of multichannel have resulted in an
ongoing reshaping of retail estates. Some
famous names, such as Comet and Woolworths, have disappeared entirely.
And the future of hypermarkets is now a problem perplexing
big grocers such as Tesco as the viability of the format – once
seen as the future of retail – is questioned.
But the fact is that some retailers remain hungry for space
– as long as it is the right sort.
Changing shopping habits have created great
opportunity in the convenience market. For instance,
while fashion giant Primark continues expansion apace,
other retailers are reconfiguring space to ensure
an optimal estate.
Convenience retail space is perhaps most
obviously in demand, reflecting a shift in consumption patterns and creating potential much bigger
than the square footage.
C-stores were among the big winners over
Christmas, which proved tough for grocers generally.
Sainsbury’s, for instance, revealed that its c-store division
put on growth of 18% in the third quarter and generated
its highest-ever sales of £7m on Christmas Eve.
In January, Sainsbury’s opened its 594th Local store
in Balsall Common, Coventry – a red-letter occasion
because it took the number of the grocer’s convenience
shops past that of supermarkets.
The opening will certainly not be the last. Although
Shopping habits and hectic lifestyles are driving the growth of
convenience, says Twigger. During the recession and
downturn consumers became more anxious to avoid waste,
meaning that top-up shopping and frequent visits to stores, as
necessity dictated, became more prominent characteristics.
Similarly, time is increasingly precious to consumers, which
means convenience stores can really live up to the name.
“The recession meant customers wanted to shop more
often and manage their budgets,” observes Twigger. “Now
there are more people employed than ever, but if you ask them
between 3pm and 5pm what they’re planning to eat, a lot of
them don’t know.” Sainsbury’s, he says, does not see such
trends changing.
Sainsbury’s has expanded its c-store division by single store
deals as well as significant acquisitions, such as that of the
Bells chain in the Northeast.
Twigger is open to all methods of continuing to gain more
convenience space and says Sainsbury’s is under-represented
and keen to pick up more premises. “It’s a real mix,” he says.
Sainsbury’s will not have the convenience field to itself.
Tesco, which already has almost 1,600 Express stores, also
continues to expand.
Rival Morrisons, which was a late arrival in the market, is
chasing space too. Morrisons opened its first M Local in 2011
and intends to have about more than 100 stores open by the
end of the financial year.
The Bradford-based grocer last year bought
49 locations from the administrators of
defunct entertainment retailer Blockbuster
and has ongoing requirements.
Premises, freehold and leasehold,
measuring between 3,000 sq ft and 6,000 sq
ft are of interest to Morrisons, which will
consider locations ranging from converted
pubs to petrol stations to new mixed-use
developments.
At the more premium end of the food
spectrum, Marks & Spencer is also opening more
of its popular Simply Food stores. Since launch in
Surbiton and Twickenham in 2001, the Simply
Food estate has grown to more than 400 shops.
Food has performed well for M&S, even as its
general merchandise arm has struggled, and last
autumn the retailer revealed plans for more Simply
Food shops in the UK, as well as abroad.
M&S’s plans show that convenience is not just about high
street locations. About half of the 150 new stores planned will
measure about 2,000 sq ft and will be run by existing partners
such as BP and SSP in locations such as railway stations,
motorway service areas and hospitals.
The remainder of the space, which will be owned by M&S,
will measure between 10,000 sq ft and 12,000 sq ft, and trade
from locations such as high streets and retail parks.
Revealing the expansion plans in October last year, M&S’s
executive director, food, Steve Rowe, said: “This franchised
and owned expansion offers us an opportunity to continue
to grow our customer base and business, building on the
progress we have already made.”
M&S’s move into locations such as hospitals follows
WHSmith’s lead, which along with being well known for its
convenience offer in transport hubs, the retailer has been an
astute judge of new types of location.
WHSmith opened eight hospital stores last year and in fact
runs two M&S Simply Food stores as franchises in Salford
Hospital and Manchester Royal Infirmary. WHSmith is also
trying out a convenience model in hospitals, railway stations
and airports with Musgrave, the owner of convenience fascias
Londis and Budgens.
It’s not just small space that retailers are interested in. Even
though last Christmas brought the strongest internet sales in
four years, one of the big winners was Primark – a retailer that
has no online presence but whose stores remain destinations
for cheap chic.
Over the Christmas, ABF-owned Primark generated sales
growth of 12%, and an 8% increase in selling space was cited as
a reason for success along with a like-for-like advance and
improved sales densities.
For Primark, space growth remains at the heart of its
business. As of January 2014, the retailer had 268 shops
trading from 9.6 million sq ft of selling space. In this financial
year the retailer is targeting another 500,000 sq ft, bringing
the net addition for the year to 1.1 m sq ft – more than in 2013.
While the retailer is increasingly taking advantage of
international opportunity, UK space remains on the
agenda. There will be three new UK openings, including
a relocation in Cardiff.
Relocations, typically to bigger premises, are happening
not just at Primark. Other highly successful retailers are
pursuing that option, including Sports Direct.
The sports retailer updated on its property strategy
in its interim results last December. It said last year it
shut 35 stores and opened 36. The average increase in store
size was 60%.
Sports Direct says: “Although sales density dropped, the
relocated stores achieved a reduction in the average store cost
to sales ratio, thereby increasing net contribution per sq ft.”
There’s no doubt that online and multichannel will
continue to grow, but successful retailers can see how to
profitably add space.
Ownership of stores can be a competitive advantage,
bringing services such as click-and-collect – an option increasingly available in the fast-growing convenience market.
While the space race may be over for some formats,
it remains intense for others. l
spring 2014
29
Report
good
Trinity Leeds’
community
impact by
numbers
The
lIfe
education
n More than 180 people engaged
in training and work experience
activity
n 20 project-initiated
apprenticeships
n 30 school visits and site tours
Having developed a sophisticated and broad Corporate
Social Responsibility culture, Land Securities has
integrated its activities and is set to launch a platform
to communicate its strategy. Mark Faithfull reports
n 18 college or school workshops
hosted by the development
team
Employment
n 622 equivalent full-time
construction jobs
S
itting in Land Securities’ Strand offices,
Catherine Thomas, London head of retail,
residential and office marketing, is frank in
her assessment: “As a company we have been
very good at CSR and all the things that it
encompasses for a long time, but we haven’t
been terribly good at telling anyone about it.”
That, however, is about to change. Indeed, it is already
changing, although you probably haven’t heard just yet.
A campaign to bolster, integrate and communicate the
company’s CSR strategy has already been launched internally
and the process of expressing its achievements, objectives and
aims to the outside world will kick-start through the umbrella
framework Shaping the Future for Good in the spring. This
will encompass Land Securities’ energy efficiency, community
and charity works and will “run like an artery” through the
business, ensuring that all decisions from development to
community engagement are made against a remit of what
positive impact those determinations will have on the wider
community and environment.
“We have embarked on a big internal process to get the
executive and management teams fully immersed in how this
formalising of our approach will be translated through the
business. But it is part of the board’s firm desire to leave a
genuine legacy about the way we do business,” says an effusive
Thomas. “There is no doubt it is going to challenge us. For
example, if we present an out-of-town development to the
board now, one of their first questions will be about what
impact it will have, or what we need to do to make that development have a positive impact. It may mean we make different
decisions to those we would have made four or five years ago.”
The strategy will encompass a range of initiatives, including
energy efficiency, which is something Land Securities has
been very vigilant about for some years. Thomas points out
that the carbon reduction requirements place the onus on
users. These highly energy efficient retail schemes are vital
to the store tenants in meeting their own obligations. This
30
Skills, young people and
spring 2014
n 55% from Leeds and Yorkshire
also creates a strong investment vehicle, as high energy-rated
buildings become increasingly important in sustainable
long-term projects. “We do, of course, recycle some of our
buildings but overall we tend to develop, hold and manage
our developments so that means we are in it for the long
term,” Thomas says.
n 1,144 equivalent full-time jobs in
the wider economy
The local economy
n £20.6m paid to local construction
workers
n 100% of workers on and off site
paid National Living Wage
Part of the community
Community engagement is an equally broad area and one in
which Land Securities has been very active on a number of
fronts for years. Trinity Leeds is a prime example of the
wide-reaching impact a scheme can have on the local community. The figures speak for themselves. For instance, 1,144
32-month equivalent jobs were supported in the wider
economy as a result of its development. In addition, £40,000
was awarded by Trinity Leeds to local community and charity
groups, and more than 180 young people benefited from workbased training (see box).
Land Securities portfolio director, retail Gerald Jennings
says: “The impact of Trinity Leeds on the local community has
been extremely positive and wide-ranging – employing local
people, working with partners to improve skills and job
opportunities, engaging with and supporting cultural activities, local charities and social enterprises, improving the public
realm, reconnecting streets and redefining and revitalising the
city centre, and encouraging further investment by others.
Trinity Leeds has and will continue to invest as a key stakeholder in the city and its life and we see our responsibility to
this community as one that creates jobs, improves skills and
enhances the long-term economic and social health of Leeds.”
Land Securities has been working with the City of
Westminster College and Tower Hamlets College in London
to offer opportunities for young people to join the construction industry, through a process that provides training, on-site
opportunities and for some apprenticeships and jobs. So far
more than 600 people – many of whom are among the
economically vulnerable as former offenders and school drop-
n £740m estimated gross economic
impact to UK economy from
The impact of Trinity Leeds
boosted the economy during
construction and once it opened
We don’t want to
drop a spaceship
into a place and suck
the lifeblood out of
it, we want it to
integrate with the
local community
Catherine Thomas, Land Securities
construction
outs – have been through the training and of those more than
a third have found permanent positions as a result. “What I
should say is that such is our network of partners that these
roles are not jobs that will directly benefit us but rather that
serve the industry,” says Thomas. “More than half of construction site workers are aged 50 or over and we desperately need
younger blood and also the newer skills in working with steel
and glass construction, for example,” she points out. “There is
no reason why those skills should not be homegrown rather
than imported from the international skill set.”
The building of Trinity Leeds resulted in the creation of
622 32-month equivalent construction jobs, with 55% of the
construction workforce being from Leeds and Yorkshire.
A total of £20.6m was paid to the area’s construction workers.
Land Securities is also working hard to engage with the
communities in which its retail developments sit, with
Thomas pointing to the importance these schemes often hold
within their local situation. That can be seen in the impact of a
major project such as Trinity Leeds, which boosted the
economy during the construction phase and has subsequently
lifted the surrounding economy since opening. “We don’t
want to drop a spaceship into a place and suck the lifeblood
out of it, we want it to integrate with the local community,”
says Thomas. That can be through on-the-ground activities
Shaping the
Future for
Good: a
positive impact
cycle
n By building sustainable places
that make good business sense…
n We can regenerate London and
strengthen communities…
n That fuel London’s economy,
creating demand for property
and construction
such as ARISE, a trust whereby grants of up to £1,000 can be
provided to scheme neighbours for everything from a wheelchair to a school trip, or new playground.
Joining the dots
So the new umbrella of Shaping the Future for Good is not so
much about reinventing the business ethos but about formally
integrating it within what Land Securities already does –
joining the dots, as it were. In doing so, Land Securities does
also hope that it will do good better. It is a project that
Thomas readily admits will be intensive and challenging to
establish in such a structured manner in the business culture.
But once firmly intertwined it will make that ethos front-ofmind and a clear determining factor for how Land Securities
conducts business now and going forwards.
“By putting everything under one umbrella it becomes
easier to integrate all these various activities and to ensure that
they work together, rather than as separate elements,” says
Thomas. “It also provides us with a platform to communicate
what it is we are doing and why. We would be the first to
admit that it’s this component that is what we have been
lacking and this initiative aims to reverse that.”
Thomas stresses that this is not about spin and having that
platform will also enable the company to “unlock stories” in the
business which, once validated and checked for their robustness can be communicated both internally and externally. The
former has already started to happen, with plenty of visual
reminders of success stories. The current future aspirations
around the company’s offices also provide a daily reminder of
the programme that has been set in motion. It’s a project that
has been put firmly in front of the faces of the entire team.
Thomas is also quick to mention the importance of working
with partners to enshrine the long-term commitment to the
project. “There’s no point us creating a great big department
dedicated to CSR and all these activities while times are
good, only to axe it or reduce it in more challenging times,” she
says. “What we have done is gone out and worked with as
many companies as possible who share our vision. That means
that the responsibilities to push it forwards sit within many
companies and that should provide that long-term, sustainable drive for the initiatives.”
Thomas also stresses that the importance of CSR has
become even more entrenched in the retail industry than one
might imagine and that expectations are high. She uses, as an
example, numerous occasions where the likes of the big Italian
luxury labels have asked the leasing team to provide details of
the company’s CSR strategy and examples of how it does
business from an environmental and community standpoint.
Having launched the initiative internally the continuing
integration will continue, while the external campaign will get
going in earnest over the next six to 12 months. For Land
Securities it is about telling an untold story, about formalising
its own approach and ensuring that it is optimised for all its
stakeholders, from investors to staff to all those communities
touched by the company’s activities across the UK. And, one
senses, about the company taking something at which it is
already a leader and embedding that expertise and ethos into
the business, for good. l
spring 2014
31
Fashion
Retail
view
The retail view
As the retail landscape evolves, consumers’ shopping behaviour is changing.
A1 talks to Land Securities outgoing executive director Richard Akers
in his final Retail View and John Lewis property director Jeremy Collins
on the state of play in the retail market
In this issue, we’ve focused on
the role of bricks-and-mortar
stores in a retail brand’s story. Why
are stores an important part of
a brand’s identity?
Q
Collins Shops are at the heart of the John Lewis
growth strategy and we continue to invest in both
new and existing shops. Shops are important for
brand representation, customer engagement, convenience and consumer experience. Our research
has shown that a bricks-and-mortar presence drives
online share and therefore sales.
Akers Strength of brand is going to be much more
important for retailers in the future as it is such an
important component in grabbing the attention of
potential customers online. Building brand online,
however, is very difficult and so stores give retailers a way of establishing their brand values face to
face with customers and therefore enhancing sales
across all channels.
Strength of brand is
going to be much
more important for
retailers in the future
Richard Akers,
Land Securities
32 32
winterspring
2010 2014
How
will the role of the store
Facts
evolve in the future? Do you think
we will
a stage
where they are
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augue commolute
delit velit,for
suscin
eum volorem
do-does it
showrooms
product?
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lutetue
depend on the type of retailer or their
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targetfacin
demographic?
Q
faccum nonsenim eugue tat. Dui
Collins
The function of shops is changing and
te tat lorperat vullan elis at, cothe role of the high street is evolving. We believe
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that customers will increasingly demand a more
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interactive
and immersive experience from retail
am quat ipit la facipis amconsedestinations.
We’re
continuing
to innovate in our
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mincidunt
shops through
product
lines,
vendre dolorem iriurem ipit,catering, services
and environment.
quiscilit utpat alit aute dolesed
Akers eugait
Different
retailers
will have a different
eumsan
henis adigna
facin
henditwill
loreuse
faccum
approach.
Some
storesautAlis
as a window to
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their product
range,alissome
will create a more
nulput destination
dolestrud do to
odit more
nonsentclearly illusexperiential
prat adionse
trate their
brand values to existing and potential
customers, and some will use their stores as mini
distribution locations for servicing a burgeoning clickand-collect channel and accepting returns from
online sales.
The trend towards smaller stores
continues. How do you envisage
this playing out in the future?
Q
Collins The starting point for us is finding
the ‘right size’ shop, in the right location, in line
with customer expectations. Full-line department
stores will still be critical anchors for large dominant
regional centres. At sub-regional locations where
convenience is the critical drive, smaller At Home
shops are proving very successful.
Akers The strategy of any particular retailer
depends on how they see their store portfolio
working for them and in many cases this means
smaller stores. For some retailers it also means
larger stores or shops in a different kind of location
to those they currently have.
Leisure is also a major focus in
this issue. As the leisure offer has
evolved in retail developments in
recent years, what impact does this
have on your stores in these schemes
and customers’ perception of
shopping centres?
Q
Collins Customers want greater choice and broader experiences during shopping trips – this can be
complemented by leisure and catering facilities.
Shops are adapting with longer trading hours and
by offering a greater variety of experience for their
customers.
Akers Leisure is an important component in
customers’ perception of a shopping centre. How
customers see the shopping centre depends much
more on the quality of the brand line-up in the food
and beverage sector than it does on the retail brands
within that scheme.
The feature on the foodie
generation shows just how rapidly
consumers’ tastes have changed.
How challenging is it to keep up
with shopper demand today?
Many say London – and
the Southeast – exists in an
economic bubble. What is your
perception of the mood of shoppers
in other areas of the UK?
Collins Consumer expectation is changing at
pace. Shoppers are demanding – and being given
– a growing pool of channels through which they
can buy the brands they love. We have a clear
strategy to ensure that we use space, flexing what
we offer, to encourage customers into our shops.
It is all part of our approach to driving interest
and footfall to shops as online sales grow. For
example, we expect customers to use little Waitrose to pick up dinner on their weekly shop while
picking up a click-and-collect order from John
Lewis Watford.
Akers This is the biggest question for the
owners of major retail destinations. These
schemes have to be kept up to date and relevant
to customers and their expectations are changing
very fast. This will lead to different lease structures, different methods of investing in retail fit out
and new concepts emerging. A great example
would be Trinity Kitchen in Leeds, which is
featured in this edition.
Collins I think the mood around the UK is
remarkably resilient. We’re confident our shops
are in the best locations. This, combined with
the breadth of offer and quality of service, puts
John Lewis in a strong position.
Akers London is booming, benefiting from
the globalisation trend and by being a stand-out
global city. The UK will benefit from this in the
longer term and we’re already seeing some of
this growth spreading out to the regions.
Q
What is the secret to remaining
relevant and adaptable in such
a challenging shopper environment?
Q
Collins Many successful retailers have an excellent
physical presence where they grow an emotional
relationship with customers, complemented by an
effective, efficient and engaging online presence that
can meet the need for convenience.
At John Lewis we are flexible so we can meet the
needs of our customer. This is reflected in our hassle
free and inspirational shopping experience, both in
bricks and through clicks.
Akers The secret for the owners of shopping
destinations is to give as many reasons as possible for customers to visit. This can be by having a
mix of the retailers that are the most attractive
to customers, the best restaurant concepts,
leisure or indeed events and digital advertising
and delivery.
Q
Is enough being done to
promote the positive impact
retail and developers can have on
local communities?
Q
Collins There is an ongoing challenge with both
politicians and communities, but the key to making
a difference is leadership.
Akers I’m afraid that there is still an attitude from
many local authorities that retail provides the value
that can then be used to regenerate wider parts of
the city or the inclusion of other lower value uses.
The reality now is that retail should be welcomed
and encouraged because it adds vitality and benefits
the community.
Did Christmas meet your
expectations, and what does
this spell for the consumer mood
for the rest of the year?
Q
Collins We’re pleased with the results over
Christmas, achieving growth of more than 7%.
We’re optimistic for prospects in 2014 as the
economy slowly recovers, although the trading
environment will continue to be competitive and
challenging.
Akers We have said for some time that structural
change in retail would create winners and losers.
I think Christmas was very much as we expected
with many retailers including John Lewis doing
well and some having difficulties, particularly with
the timing of discounts. l
I think the mood
around the UK is
remarkably resilient.
We’re confident our
shops are in the best
locations
Jeremy Collins, John Lewis
spring 2014
33
Land Securities Retail
Shopping centres
Location
Property Name
Area sq m (sq ft)
Principal Contact
Phone Number
Birmingham
Priory Square
26,003 (279,900)
Rich Hutchinson
0141 331 4403
Bristol
Cabot Circus
134,986 (1,453,000)
Vasiliki Arvaniti
020 7024 5134
Cardiff
St David’s Dewi Sant
130,063 (1,400,000)
Graeme Stevenson
0207 024 5415
Dundee
Overgate Centre
39,019 (420,000)
Katherine Armstead
0141 331 4409
Exeter
Princesshay
49,238 (530,000)
Simon Haworth
0207 024 5137
Glasgow
Buchanan Galleries
56,411 (607,200)
Katherine Armstead
0141 331 4409
Leeds
Trinity Leeds
92,902 (1,000,000)
Katherine Armstead
0141 331 4409
Leeds
White Rose
63,174 (680,000)
Harlan Pollitt
0113 261 5351
Livingston
The Centre
80,639 (867,986 )
Rich Hutchinson
0141 331 4403
London
One New Change
20,439 (220,000)
David Atcherley-Symes
020 7024 3730
London
Shopstop, Clapham
4,170 (44,884)
Gemma Dew
020 7024 5133
London
Lewisham Centre
31,269 (336,579)
Andrew Rawlings
020 7747 2336
London
W12, Shepherds Bush
24,155 (260,000)
Andrew Rawlings
020 7747 2336
London
The O2 Centre
25,770 (277,385)
Andrew Rawlings
020 7747 2336
London
Southside, Wandsworth
49,238 (530,000)
Gemma Dew
020 7024 5133
Oxford
Westgate Centre
29,729 (320,000)
Simon Haworth
0207 024 5137
Salisbury
The Maltings
8,921 (96,022)
Robert Hardie
020 7024 5083
Sunderland
The Bridges
47,844 (515,000)
Harlan Pollitt
0113 261 5351
Outlets
Location
Property Name
Area sq m (sq ft)
Principal Contact
Phone Number
Hatfield
The Galleria
29,729 (320,000)
Robert Hardie
020 7024 5083
Portsmouth
Gunwharf Quays
39,483 (425,000)
Gemma Dew
020 7024 5133
Retail parks
Northampton
Nene Valley Retail Park
13,657 (147,000)
Ian Bramley
020 7024 5484
Poole
Poole Retail Park
19,325 (208,011)
Nick Duffield
020 7024 5485
Taplow
The Bishop Centre
9,429 (101,500)
Nick Duffield
020 7024 5485
Thanet
East Kent Leisure
9,290 (100,000)
Hermione Mackrill
020 7024 5486
Thanet
Westwood Cross
44,129 (475,000)
Hermione Mackrill
020 7024 5486
West Thurrock
Lakeside Retail Park
35,004 (376,778)
Ian Bramley
020 7024 5484
Workington
Derwent, Derwent Howe
14,903 (160,426)
Ian Bramley
020 7024 5484
Leisure centres
Location
Property Name
Area sq m (sq ft)
Principal Contact
Phone Numer
Bath
Kingsmead
8,361 (90,000)
Polly Troughton
020 7747 2398
Manchester Printworks
32,516 (350,000) Julie Garsden
07764 208 791
Nottingham
The Cornerhouse
20,900 (225,000)
Andrew Russell
020 7747 2395
Boldon
Boldon Leisure Park
5,275 (56,780)
Andrew Russell
020 7747 2395
London
West India Quay
6,597 (71,010)
Polly Troughton
020 7747 2398
London
Great North Leisure Park
8,542 (91,945)
Andrew Russell
020 7747 2395
Wolverhampton
Bentley Bridge Leisure Park
9,195 (98, 974)
Julie Garsden
07764 208 791
Kent
Eureka Leisure Park
9,232 (99,372)
Mark Lomax
0207 747 2396
Aberdeen
Queens Links Leisure Park
11,951 (128,639)
Mark Lomax
020 7747 2396
Maidstone
Lockmeadow Leisure Complex
13,214 (142,234)
Andrew Russell
020 7747 2395
Cambridge Cambridge Leisure
13,863 (149,220)
Mark Lomax
020 7747 2396
Poole
Tower Park Leisure Park
18,510 (199,240)
Mark Lomax
020 7747 2396
Norwich
Riverside
19,595 (210,920)
Mark Lomax
020 7747 2396
Leeds
Cardigan Fields
21,436 (230, 735)
Julie Garsden
0161 486 5035
Edinburgh
Fountain Park
21,636 (232,890)
Andrew Russell
020 7747 2395
Manchester
Parrs Wood
21,795 (234,600)
Julie Garsden
07764 208 791
Brighton
Brighton Marina
31,855 (342,884)
Mark Lomax
020 7747 2396
Yorkshire Xscape Yorkshire
33,650 (362,205)
Julie Garsden
07764 208 791
Milton Keynes
Xscape Milton Keynes
39,109 (420,966)
Andrew Russell
020 7747 2395
Location
Property Name
Area sq m (sq ft)
Principal Contact
Phone Number
Bexhill-On-Sea
Ravenside Retail & Leisure Park
24,131 (259,750)
Hermione Mackrill
020 7024 5486
Blackpool
Blackpool Retail Park
11,271 (121,323)
Ian Bramley
020 7024 5484
Bracknell
The Peel Centre
15,384 (165,592)
Nick Duffield
020 7024 5485
Developments
Chadwell Heath
Goodmayes Retail Park
9,197 (99,000)
Ian Bramley
020 7024 5484
Location
Property Name
Area sq m (sq ft)
Principal Contact
Phone Number
Opening
Chester
Greyhound Retail Park
18,859 (203,000)
Hermione Mackrill
020 7024 5486
Taplow
The Bishops Centre
12,217 (131,500) Nick Duffield
020 7024 5485
2014
Chesterfield
Ravenside Retail Park
12,344 (132,875)
Ian Bramley
020 7024 5484
Wandsworth
Wandsworth
8,733 (94,000) Neil Carron
020 7024 5051
2014
Crawley
Sussex House
Maidstone
Newnham Court
20,903 (225,000)
Chris Ward
020 7024 5482
2015
Derby
Meteor Centre
16,920 (182,130)
Nick Duffield
020 7024 5485
Glasgow
Buchanan Quarter
37,161 (400,000)
Nick Davis
020 7024 5203
2017
Dundee
Kingsway West Retail Park
27,768 (298,900)
Hermione Mackrill
020 7024 5486
Oxford Westgate
74,322 (800,000)
Bert Martin
020 7024 5076
2017
Gateshead
Team Valley Retail World
35,083 (377,650)
Nick Duffield
020 7024 5485
Selly Oak
Selly Oak
42,888 (461,646)
Hermione Mackrill
020 7024 5486
2017
Livingston
Almondvale Retail, South & West
35,285 (379,800)
Nick Duffield
020 7024 5485
Ealing
Ealing Filmworks
21,695 (233,527)
Riccardo Mai
020 7024 5136
2018
34
spring 2014
10,999 (118,388) Ian Bramley 020 7024 5484
spring 2014
35
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Over 180 retailers including John Lewis and Primark’s new Welsh flagship.
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