Opinion

FOCUS ON THE BRAND – AN ADVANTAGE ON SEVERAL LEVELS

New projects always involve necessary preparations: We investigate which cities might make sense for us and our customers, look at purchasing power, traffic, development, and infrastructure plans for each region, etc., and define the most appropriate place for a potential retail or logistics property on the basis of the parameters analyzed.

BY DIETMAR REINDL

BY DIETMAR REINDL

We place a strong focus on brand building in our real estate portfolio. This has proved to be an advantage in all areas of our business – both in development and asset management – and not least in the area of transactions, with an ultimate view towards a later sale.

But let’s start at the beginning, at development: Here we focus on our strengths as a large group. We have a strong financial position and are present in many markets, so we can build on existing structures. This allows us to roll out a product under one umbrella brand in several countries very quickly – you can definitely compare it to an industrial production process. Our retail warehouse chain Stop.Shop. is a very good example. They are characterized by uniform quality standards, functionality, and high recognition value. In the last fiscal year, we also created Vivo!, a new brand for retailers because, especially in the retail sector, the presence of different concepts has proved useful.

Vivo! shopping centers are between Stop.Shop.s on one side and large shopping centers on the other, in terms of size, position, and range. Vivo! combines the advantages of both approaches: the “easy shopping” of retail warehouses and the strong entertainment component we know from our large shopping centers. They are typically single-story shopping centers with strong fashion and entertainment focus, which is ideal for small and medium-sized cities. Branding is not just an advantage in the early stages, it is highly useful in the long term as well. From our residential brand Buwog to the retail warehouse chain Stop.Shop. and our new Vivo! Centers, to Deutsche Lagerhaus and Log Center, which handle our logistics activities in Germany and Eastern Europe, we can already point to numerous successfully established brands with which we are also expanding further in our core countries.

We already have 52 Stop.Shop.s in Central and Eastern Europe and, while further expansion is planned in Poland, in particular, we are also preparing our first Stop.Shop.s in Romania and Serbia. The move to Serbia, incidentally, is at the behest of our tenants and we are happy to follow up on their wish given the Balkan country’s potential.

Retailers therefore appreciate our clearly defined brand policy and our large network. To expand into new countries, they require a certain minimum number of sites in order to achieve economies of scale. They therefore want a reliable partner and developer to accompany them who is able to quickly implement a roll-out in several countries. A few statistics on this: We do not usually begin with the detailed implementation of a new Stop.Shop. until we reach a pre-letting level of around 70%. Overall, about 80% of the area in a Stop.Shop. is occupied by international tenants who accompany us. Takko, Deichmann, DM, and KiK are just a few of those prestigious international retailers that are present in more than 30 of our Stop.Shop. sites. These figures are a good example of our successful brand strategy.

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