December retail figures could improve on last year, says Paul Gerard
This December's retail trade could well be an improvement on last year, despite 2016's frail and fickle economy. This festive season, people will spend mostly on first-order goods, such as food, pharmaceuticals, services and clothing. In contrast, furniture and other discretionary purchases are likely to be less appealing to shoppers.
Paul GerardPicture: Supplied
This is according to Paul Gerard of Flanagan & Gerard Property Development & Investment, a leading shopping centre developer and retail leasing specialists. “Even with the current political volatility, macroeconomic indicators favour the festive trading season in 2016,” says Gerard.
His careful optimism is driven by the performance of retailers in the company’s shopping centre portfolio, which show better growth than figures published for the industry. Noted retail developments under its belt include Vaal Mall, Paarl Mall, Mall of the North, Middelburg Mall, Highveld Mall, Heidelberg Mall, Eyethu Orange Farm Mall, Morningside Shopping Centre and Nicolway Bryanston, among others.
“This year has given consumers plenty of new retail space, especially in the Gauteng region, and boosted their choices with new international brands. Dominant regional shopping centres are best poised to attract spend, however, trading success relies strongly on a shopping centre’s relevance.
“Shopping centres that successfully compete for market share are those deeply rooted in their communities. They offer a mix of shopping, services and leisure that accurately reflect the community or region they serve. They also take part in more community involvement.
Add seasonal décor
Adding the seasonal bells and whistles to a festive shopping experience can also help support good holiday trade.
“Décor itself plays a small part in driving festive trade. People are generally aspirational and favour shopping environments that are more elegant and engaging. Depending on the community in which a mall is located, entertainment can contribute to promoting festive spend.
“As for online shopping, it still plays a very small role and only in higher-income areas within metropolitans, so it will not have a significant impact on bricks-and-mortar retail this summer.
Positive outlook for 2017, with new developments
Beyond the festive season, Gerard’s outlook for retail property in 2017 is positive as the shopping centre industry continues to advance.
“As the information revolution continues, the shopping centre mix evolves. Service-based retail will continue to become more prominent. In addition, multichannel and omnichannel retailing will become more prevalent. Retailers will offer all forms of shopping and do so in a more integrated way. For example, offering online shopping with click-and-collect options from bricks-and-mortar stores.”
The company also has an impressive trio of exciting new retail property developments set to open in 2017.
The Springs Mall at Blue Crane Eco Park in Ekurhuleni Gauteng opens on 16 March 2017. At 48,000 sqm, it will be the only major mall in its region. It is a joint venture between Flanagan & Gerard, Blue Crane Eco Mall, JSE-listed retail focused SA REIT Vukile Property Fund and Murinda Investments, which is part of the Giuricich Bros Group.
The 80,000 sqm Ballito Junction Regional Mall redevelopment on KwaZulu-Natal’s Dolphin Coast will open on 23 March 2017 with 200-plus shops. It is owned and developed by Flanagan & Gerard with Menlyn Maine Investment Holdings.
The 50,000 sqm regional Thavhani Mall at Thavhani City in Thohoyandou, Limpopo, opens on 24 August 2017. Flanagan & Gerard is the developer and shareholder in Thavhani Property Investments, responsible for the leasing and development of the mall. Vukile Property Fund has also secured a one-third stake in this mall, which will transfer on its completion.
