BY JONATHAN DOUGHTY
It is not unusual for businesses to buy businesses, but I think the message to the marketplace in this case is more than just growth and acquisition: I believe it clearly signposts the direction for the property industry and certainly the shopping center industry. We are very pleased to now be part of JLL, as it gives us the global platform we need to support our growing work around the world.
The fundamentals of shopping centers and the way they operate are changing, and at such a speed that is it often hard to keep up with the next development, trend, or innovation. Our business has seen an almost vertical rise in instructions, as owners, developers, and landlords seek to harness the “power of food.” Many of them now understand the excitement and delight that a great foodservice offer can bring to a “retail place,” not only filling vacant space left by diminishing retail demand, but also providing settings for people to enjoy.
ALL DAY EVERY DAY
Through collaborative effort with architects, designers, and operators, the shopping center industry is turning into an ADED (All Day Every Day) business as it finds ways to provide food, drink, and fun for the guests who choose to visit these centers. It is not always possible to provide food across the whole trading day if the center doesn’t provide evening opening hours and a destinational function including leisure and restaurants, but we are all becoming less reliant on the traditional meal occasions of breakfast, lunch, and dinner and are blending our foodservice requirements across the day more smoothly.
One of the major attractions of joining JLL is the research expertise that they bring. The platforms they have developed and the data that they have access to will bring significant benefits to our business and will allow us, in turn, to provide 21 years of foodservice data to their worldwide client base. The reason I say this is that data on performance is now critical in order accurately to forecast and determine the returns that clients can expect from foodservice. While this will remain confidential, and subject to all the privacy and data terms that we have agreed to, it will provide a fascinating and robust modeling platform for future performance. I have long held the view that footfall to a shopping center is not the main goal and that the quality and spend potential have a significant impact on retail and on foodservice spending. What limits us in the foodservice world is the quantity of food that any one person can consume in any one day, whereas in the retail world, theoretically, a guest can continue to spend until they reach their credit limit or become too tired! The latest data modeling that we are doing around spend per minute, effective dwell times, average transactions, and buying patterns will also “plug in” to the data set at JLL to further enhance the strategic advice that it gives.
PROVIDING A GLOBAL PLATFORM
We enjoy a high level of accuracy in our work and it is interesting to see how the gap is closing between foodservice and retail rents. It will be even more interesting to see how foodservice positively impacts on retailers who surround major food spaces. We are seeing a change from “anecdotal” and “gut feeling” reactions about the impact of foodservice to a more grounded and data-based approach, which is now proving the benefit of foodservice. The most recent CACI research, which clearly demonstrates that foodservice extends the visit length and improves the retail spend per consumer, was welcome news for our business.
One of the other benefits that we now see through our new owners is the ability to provide a global platform for landlords, developers, owners, foodservice operators, and franchisees. We already work extensively to connect people from different parts of the world and, as operators look further afield for new openings, we fully intend to be at the heart of this activity.
EXCITING TENANT LINE UPS
21 years ago, the challenge was to get foodservice operators to go into shopping centers, five years ago, the challenge was to get London operators to move out of London. Today, we see very few challenges with the movement of operating brands and concepts across the world. By providing a one-stop shop of foodservice connectivity, we believe that we can satisfy the needs of the property market and the ongoing needs to the foodservice industry.
Only time will tell, but it is clear to me that we will still see much greater growth in foodservice and much more exciting tenant lineups, particularly once the traditional barriers of country-specific legislation and labor markets are better understood. An example of this would be a Turkish business we are working with at the moment that is looking to move across Europe with a range of foodservice brands. They are edgy, interesting, and the food quality is excellent. Change is happening in the world of food and we are looking forward to the future.
What is your opinion on this topic? Discuss it with us! Send your opinion to firstname.lastname@example.org !