ACROSS: MR. CECH, BRICK-AND-MORTAR RETAIL HAS BEEN IN A PHASE OF UPHEAVAL FOR SOME TIME NOW. SOME HAVE ALREADY PREDICTED ITS DEMISE. WHAT IS YOUR ASSESSMENT OF THE CURRENT SITUATION?
ANTON CECH: We are in the midst of a consolidation phase, but brick-and-mortar retail is far from dead. However, the wheat is being separated from the chaff. Tenants are opening fewer locations than in the past and are looking for locations with high footfall. The examples of various fashion brands illustrate this trend. Inditex was the first to do so, only opening Zara stores at highly frequented malls, and now its competitors are following suit. In my opinion, things are moving a little too slowly, but this is clearly a trend.
The winners are, without a doubt, the large locations and mega malls. They will emerge as the victors from this consolidation and selection process among locations. In Seiersberg, for example, we welcomed 7.8 million visitors in 2025, which is +25%, or 1.6 million more visitors than in 2019, in other words, before the outbreak of COVID-19, confirming this trend toward strong locations.
ABOUT ANTON CECH
Anton Cech, 52, has been the Managing Director of Shopping City Seiersberg, Austria’s third-largest shopping center, and Shopping City Wels since January 1, 2023. After studying commercial sciences at the Vienna University of Economics and Business, he joined Bank Austria as a real estate risk manager, then moved on to Rodamco in 2006, where he played a key role in the acquisition of Shopping City Süd in Vösendorf. He later took over the operational management of the shopping center.
ACROSS: DOES THAT ALSO MEAN, BY EXTENSION, THAT HIGH-TRAFFIC LOCATIONS ATTRACT BETTER TENANTS, WHILE SMALLER LOCATIONS STRUGGLE WITH VACANCIES?
CECH: Ultimately, it’s management that’s crucial here. In this difficult market environment, management’s job is to clearly define and identify what the offer stands for, which target groups need to be reached, and what mix will make it all possible. Smaller malls simply have to be positioned differently. They may serve more as local suppliers and might try to attract tenants from the surrounding area instead of dreaming of landing major brands. They won’t be able to attract them. The era of expansion, when all tenants were desperately searching for locations, is over.
ACROSS: HOW HAS THAT CHANGED THE RELATIONSHIP BETWEEN TENANTS AND OPERATORS?
CECH: Success cannot be taken for granted. As an operator today, you have to work very hard and constantly refine your offering. Tenants’ expectations have risen. They expect a mall with an attractive mix of tenants, an appealing atmosphere, high footfall, a service-oriented approach, and assistance from the operator. When it comes to the relationship between landlords and tenants, tenants have clearly gained the upper hand. Today, it’s much more of a partnership in which both sides listen to each other, assess the situation together, and consider how they can be more successful. This is an ongoing process, and we communicate with all of our tenants at least once or twice a year.
ACROSS: HOW DIFFICULT IS IT TO ATTRACT INTERESTING TENANTS TO SHOPPING MALLS THESE DAYS?
CECH: Everyone is under pressure because no tenant can afford to be saddled with a poor location. Expansion and sales managers cannot afford to make any mistakes. As a result, negotiations take much longer nowadays. The initial talks alone, during which the sales department has to be convinced by the mall, the micro-location, and the catchment area, now take 12 months or longer. The sales department has to deliver sales, and these form the basis of the negotiations. Over the last two years, sales have been estimated very conservatively. That makes negotiations even more complex and lengthy. My assessment is that there is a lot of fear involved.
ACROSS: ARE TENANTS CURRENTLY ATTEMPTING TO LEVERAGE THEIR NEWFOUND STRENGTH DURING NEGOTIATIONS? IS THERE PERHAPS A CERTAIN DEGREE OF REVANCHISM?
CECH: No, I don’t believe so. No one is playing games. In this industry, you encounter the same people repeatedly. It is, therefore, important to always communicate on equal terms, remain fair, and never part on bad terms.
ACROSS: BACK TO THE TENANTS’ DEMANDS: TO WHAT EXTENT HAS THE STRAINED ECONOMIC SITUATION SLOWED DOWN DEMAND FOR SPACE?
CECH: Seiersberg is one of the largest malls in Austria. We are pursuing a clear flagship strategy here. We aim to have the latest concepts in the largest format. We cannot simply be satisfied with second-rate formats just because our mall is located in Styria. We strive for the same format that can be found in the Westfield mega malls in Vienna. We also make use of these spaces, offering tenants the opportunity to present themselves in the best possible light with the widest range of products and to offer customers an experience. That’s the only way to compete with online retailers. We also have some great examples that we can point to, such as the Nike store, which opened a year ago and is generating excellent sales, and our partnership with the Bestseller Group, where all concepts are represented in flagship format.
ACROSS: AND WHAT ABOUT RENTS? ARE TENANTS TRYING TO GET MORE FAVORABLE TERMS DUE TO THEIR POSITION AND THE ECONOMIC SITUATION?
CECH: Price increases and inflation-related factors have caused margins to melt away in recent years. I fully understand why tenants are trying to reduce costs, but when it comes to rents, I’m certainly not an easy negotiating partner. With more than 20 years of experience in this field, I have a reasonable understanding of adequate rental costs, rent levels, and sales figures at other malls. If sales are roughly the same, then it stands to reason that we want to have the same rental rates. On the one hand, we are quite competitive in this regard, but on the other hand, we are more willing to compromise than some of our competitors when things aren’t going well. Before we lose a tenant, we try to find a solution together. The bottom line is that sales, rent, and margins have to be in line with each other.
ACROSS: TO WHAT EXTENT DO SUSTAINABILITY AND ESG ISSUES PLAY A ROLE FOR TENANTS TODAY?
CECH: The topics are not as hotly debated as they used to be, but they are indispensable at modern shopping malls. Certification is expensive, however, and tends to be more important when it comes to publicly traded companies and financing. Even private owners can ill afford to ignore these issues, because consumers are demanding them. We collect water on site, we’ve installed a PV system, and we’ve set up e-charging stations. Charging stations have become something that consumers expect, so they’re now a must-have offering.
ACROSS: AS MENTIONED, AN ATTRACTIVE TENANT MIX IS A KEY FACTOR WHEN IT COMES TO ATTRACTING MAJOR BRANDS AS TENANTS. IN ADDITION TO TRADITIONAL RETAIL, FOOD & BEVERAGE AND ENTERTAINMENT ARE ALSO MUST-HAVES FOR ANY MALL. HOW HAVE CONDITIONS CHANGED IN THAT REGARD?
CECH: The trend toward food & beverage has been around for years, and that’s something we’ve taken into account at Seiersberg. Since 2022, we have significantly increased our food and beverage share from around 5% to 16%. We have also built outdoor terraces so that restaurateurs can offer a better and higher-quality range of products. The issue is important, but it has its limits. I don’t believe that a mall like ours can support a food and beverage share of 30 to 35%. Ultimately, everyone wants and needs to generate sales. However, we still lack an entertainment area and, as a result, evening business opportunities. There is a project in the pipeline that is set to be implemented later this year and will strengthen Seiersberg as a destination. It will pave the way for the next evolution in the gastronomy sector.
ACROSS: WE ARE CURRENTLY SEEING THE RAPID EXPANSION OF BOTH DISCOUNT BRANDS AND LUXURY BRANDS AT SHOPPING MALLS. WHAT IS YOUR TAKE ON THIS DEVELOPMENT?
CECH: For a center like Seiersberg, I don’t see the future in either the pure discount or the luxury segment. Discount is a double-edged sword – it generates footfall, but it often attracts crowds that other brands find more difficult to deal with. Luxury, on the other hand, is a very narrow segment and is only of limited suitability for the mass market that we are focused on. Ultimately, it’s a management decision. We have clearly positioned ourselves in the broad middle and offer strong brands with affordable quality. We don’t want a cheap image. That fits perfectly in line with our target group – the people of Styria and Graz – and is greatly appreciated by our tenants. One exception among discounters is certainly Primark. I believe that Primark is better off at a mega mall than anywhere else. Even though the brand is considered to be relatively controversial, it generates footfall, and the mall benefits from that.
ACROSS: ANOTHER TOPIC THAT CONCERNS MANY TENANTS IS HYBRID SHOPPING – THE INTEGRATION OF BRICK-AND-MORTAR RETAIL AND ONLINE RETAIL WITH STORES SERVING AS PICK-UP AND RETURN POINTS. TO WHAT EXTENT DO YOU CONSIDER THIS TO BE A RELEVANT ISSUE FOR MALL OPERATORS, INCLUDING FROM A LOGISTICAL PERSPECTIVE, AND ONE THAT NEEDS TO BE CONSIDERED?
CECH: I believe that this will be an important factor in the future. There are a number of retailers that are already succeeding in that area. Mediamarkt, for example, has a very high click-and-collect share in the electronics sector. We, however, are only at the beginning of this development. Many retailers describe themselves as omnichannel providers, but they don’t have consistent hybrid concepts. Brick-and-mortar retail and online retail are still completely separate channels; online orders and returns are handled purely by mail from their own logistics centers. This is a missed opportunity to integrate brick-and-mortar retail, for example, by charging for returns by mail and offering free returns in stores. Customers are very price-sensitive, and when they return an online order to a store, the goods can be sold there. Customers might also buy or consume something else. That level of integration has not been achieved yet. It’s a shame, but retailers really need to think ahead in this regard. I believe it will happen. It would be an enormous added value for retailers, customers, and centers.
