Brisbane shopping centres fighting back against online threat
It appears the days of the local shopping centre being home to a supermarket, fish and chip shop, old-school bakery and discount shoe store are on the way out.
Brisbane’s neighbourhood shopping centres are thumbing their nose at the competition from online retailers by creating interesting spaces that customers want to visit and not just somewhere to simply buy groceries, said CBRE senior research analyst Yvette Burton.
Introducing other businesses such as gyms and child care centres, with the aim of improving foot fall across their shopping centres, would in turn flow on to increased patronage of other retail outlets, she said.
“Retail investors are looking to re-position their centres, with a shift away from a strong apparel focus to more food and beverage and eateries.”
One example was a recently completed extension at Newmarket Village, in inner-city Brisbane, with the project including more retail space as well as an eight-screen Reading cinema, according to CBRE.
CBRE head of retail investments Peter Rossi said the best neighbourhood centres were enhancing their product or tenancy mix, but at the end of the day they still had to be convenient.
“Car parks are the engine rooms to the cash registers, convenience is king, and if you’re not convenient, you’re just another shopping centre,” he said.
This resurgence in Brisbane’s neighbourhood centres was already starting to flow through to sales, with CBRE data showing sales volumes reached a record high of $522 million in 2017 – up from $298 million in 2016, and up on the long-term average of $209 million sales per annum.
One of the new restaurants, Schnitz, in the Newmarket Village centre. Photo: Facebook
Brisbane neighbourhood centres that had sold recently included Bluewater Square in Redcliffe, which was sold for $55 million, and Wondall Road Village in Manly West, which fetched $16 million. Domestic investors were the main buyers, accounting for about 92 per cent of transactions in 2017.
“With a significant shift towards value-add acquisitions over the past 12 to 18 months and a focus on experiential shopping, major refurbishments and extensions to existing shopping centres continue,” Ms Burton said.
“Over the next three years, there is about 30,000 square metres of extensions mooted across nine existing neighbourhood centres.”
Colliers International retail management director Steven Schneider said the rejuvenation of Brisbane neighbourhood centres also included new thinking about the length of tenancies.
He said owners were also considering whether shorter-term leases of five years were actually better to underpin the continued vitality of centres.
“You need to remain interesting. You need to remain current. Which means, do you do five-year leases? Do you do shorter leases? What do you do for your retailers to allow them to be flexible in what they offer?” he said.
“They have to be nimble, they have to be flexible and they need to change. Maybe it is five years that you have a retailer in there, but you’ve got to think that after five years is that boring? Is that old?”
He said neighbourhood centres were recognising that they needed to remain continually interesting to their community, which included providing a changing environment.
“Otherwise, you’re just boring and old and it gets forgotten,” he said.
