How to choose a shopping centre location

Franchise Buyer Shopping Centres Episode 14

By Peter Buckingham

Episode 14 of the Franchise Buyer VLog with Glenn Walford as the host talks about ‘The best shopping centres to open a store in.’

Shopping Centre Sizes

Glenn starts by talking about the six various shopping centre sizes:

  • Super Regional 85,000+ square metres
  • Major Regional 50,000 – 85,000 square metres
  • Regional 30,000 – 50,000 square metres
  • Sub Regional 10,000 – 30,000 square metres
  • Neighbourhood up to 10,000 square metres
  • City Centre – in CBD Locations

Peter Buckingham

He then interviews me and I recommend the Super Regionals and Neighbourhoods as worthwhile, but the middle range shopping centres in the Major Regional and Regional categories may struggle as they are neither too big or too small and another Super Regional may be nearby.

In my view, right now, everything is negotiable and it is worth offering a low rent and special conditions and be willing to upset a leasing agent as they have a thick skin.

Phillip Chapman

Glenn then interviews Phillip Chapman who talks about the High Streets being gentrified and he calls them the Suburban Business Districts (SBDs) with people shopping more locally and Transport Oriented Developments (TODs) that have an increased footfall traffic as they are close to public transport train stations and bus interchanges with car parking close by and actively supported by local councils.

Phillip also mentions that you need to remember that you are leasing time not space, you need to review how you hold your leases, the structure, the vehicle or entity that is going to hold it and manage your risk carefully.

Ange Kondos

Glenn then interviews Ange Kondos who recommends that it depends on your category but that Super Regional shopping centres, provided the commercials are correct, are worthwhile.

Post COVID-19, people are sticking close to their localities far more than they were pre-COVID-19 and they also see a community hub as an advantage and the CBD is the loser. Neighbourhood Centres and Convenience Centres performed far better than Super Regionals, but that was because of lockdown and it was easier to get in and get out.

The Super Regionals had over-heated rents, but provided the commercials and the business case support that, they may be worthwhile. The Super Regional shopping centre is competing with the quick convenience of smaller shopping centres.

The Super Regional where people spend three to five hours on entertainment, shopping and letting children escape, currently have an identity problem and could be hard done by under present conditions.

Getting the correct data and advice is essential as there are a lot of shifting patterns. It is necessary to be more patient than usual and believe in your business, your business case and be prepared to walk away.

Ange mentioned that he is already seeing strong brands and retailers moving and changing leases at the last minute and recommends that you bid strong, but consider the bid before you make it. The market is not giving its real message right now.

Shopping Centre Facts and Data

At Spectrum Analysis, we can help provide the facts and data to help you make the right decision and help you out with:

  • site potential reports
  • shopping centre profiles
  • territory planning and network mapping
  • and more

Contact Spectrum Analysis if you would like more information or advice.