Tell us a bit about yourself and about MAB Development.
I am the Managing Director International of MAB Development Group, responsible for the group’s international activities focusing on Germany and France. We have a joint venture with NEINVER for the development of factory outlet centers in France, Germany and the Netherlands. Our main focus is on retail; about 75% of our portfolio is retail-related, it can also be mixed-use but there is always a very strong retail component.
What can you tell us about factory outlet centers?
With factory outlets it is all about multi-channeling, as they are fully integrated in the retail hierarchy. On the one hand they are considered as just adding to city retail, but on the other hand it is a very niche product. You can always be in a dominant position with FOCs, as their number is usually limited. They are very attractive and different than full-price retailing because they are more management-intensive. You need to entertain shoppers in order to keep them longer in your outlet, since the average stay is between two and two and a half hours.
What are the latest trends in retail right now? What would you say is the near future for retail developments?
As Chair of the ICSC jury, I see that there is a change in trends, especially in mature markets where there are hardly any new developments. We can also see this from the entries for the 2014 ICSC European Awards; in mature markets these are mainly refurbishments and extensions, while in less mature markets such as Bulgaria, Romania, Turkey and Russia it’s all about new developments. Poland, Slovenia and the former Yugoslavia are also some of the markets where we can see an influx of new developments.
It was nice to hear from the Chair of ICSC in Russia that in 2013, they have opened over 100 new shopping centers in Russia. In Europe, the situation is quite different, with very few new developments and an increased focus on refurbishment. In the UK they call it ‘New Retail’; one example is the scheme of Land Securities in Leeds, which is a refurbishment for the city of Leeds, but also a brand new shopping center at the same time.
What do you think about the additional functions of today’s shopping centers?
Shopping centers today are a place to be, a place to stay, a place to meet, not just a place to shop, because you can also shop online. Many people say that online shopping is one of the main threats for physical retailing, but if you look at most retailers it’s actually all about multi-channeling. Online is one of the channels, but I don’t believe it will ‘kill’ physical shopping centers. On the contrary, a lot of online shops, who started just online, are now opening physical shops as well.
What is your view on the situation in mature markets today? Is the market stabilizing in the Netherlands, Germany and Europe in general?
We went through a major crisis in Europe and I don’t know whether we have already left the crisis. The situation can actually by explained using the difference between ‘confidence and trust’: you start with confidence in order to come to trust. I think there is more confidence coming but I am a bit hesitant whether trust is already here. Maybe in the future it will be different.
Would you say that most opportunities are in emerging markets like Turkey and Poland or do you think there is still opportunity in mature markets?
I think even in mature markets there are still a lot of opportunities, especially if you are doing refurbishments or extensions. We have an initiative with Bouwfonds Investment Management, who set up a European Retail Refurbishment Fund, meaning buying existent shopping centers with some vacancy, which need to be remodeled or need an extension. We have done extensive research in more mature markets, such as the Netherlands, France and Germany, and we have come up with a huge list of opportunities.