Despite the weaker economic fundamentals, there are still new opportunities for shopping centres in 2015, continuing its strong contribution to South Africa's growth in recent years, with numerous new shopping malls coming to market.
Five dominant trends
Caution: Retailers and retail developers need a cautious approach in the year ahead. It is essential to have sound retail development basics in place to ensure the success of a new shopping centre in this flat-growth, rising-interest economy.
Know-how: With high stakes, a proven record of accomplishment of delivery is essential and new retail schemes left to experienced developers. This market is unforgiving and there are inexperienced retail developers who are muddying the waters right now. It is essential to assess every detail of a potential project astutely - site assessment, rental levels, tenant mix, aesthetics, finishes and more. This requires insight that can only be gained from experience.
Rural shopping centres: There are still opportunities in the area of rural retail in South Africa and opinion is bullish about this sector of the market. Even in these areas, outside of South Africa's major metropolitan nodes, developing the right product is essential for success. A rural retail development must be aspirational yet affordable. It should also have all the fundamentals in place to stand up to the same tests, which would apply to a mall in an urban environment. You cannot cut corners for rural shopping centre development.
Better retail: With a slew of international retailers entering the South African market, our local consumers will continue to reap the ultimate benefit. International retailers operating in and entering South Africa are improving the local retail offering considerably. This puts pressure on local retailers to be more competitive. The new wave of retail competition is improving choice; pricing and the overall retail experience for shoppers throughout the count and is set to continue during 2015.
Listening to consumers: There is a renewed focus on customers and "what does the consumer want?" will become an ever more important consideration in planning retail centres. There's no room for developers' egos to dictate what they would like the consumer to want or for architects to lead developments.
