A1 march2014

Fashion missionWhy Karen Millen plans to ‘democratise luxury retail’

Premium playersWhy premium fashion retailers

hold the key to success

Destination leisureThe importance of leisure

in retail-led schemes

Foodie generationRetailers seize opportunities as a new trend in dining out emerges

spring 2014

20

As this is my first issue of A1 since taking on the role as managing director of Land Securities’ Retail business, on behalf of the team I’d like to thank Richard Akers for his leadership, and his support during the handover. Richard has made an outstanding contribution to Land Securities since joining the company in 1995 and, under his leadership, we have cemented strong relationships with retailers, been a driving force in the retail property sector and our portfolio has consistently outperformed the index for the sector in the UK.

As a business, we have always focused on proactively responding to changes in the market, as the feature on page 30 shows. People are buying more online, but we are still social creatures; we want to meet, try and taste. Put simply, you can’t eat out online and there is huge interest in dining out and experimentation with different cuisines. As a Canadian who has lived in this country for more than 20 years, I have seen this transformation first hand. When I first came to London there was a limited choice of cuisines, now London is the foodie capital of the world, and that trend is extending across the UK. The feature on page 20 explores this trend and Land Securities is pioneering concepts such as Trinity Kitchen at Trinity Leeds and Bar 44 – the mobile tapas offer at St David’s in Cardiff.

Retail innovation has never been more critical and we’ve recently announced our support of TrueStart’s hub (page 26). It is designed to bring together the brightest young minds and start-ups. The partnership will give us and our customers exposure to the most cutting-edge products and technological developments in the retail and consumer world. TrueStart entrepreneurs will have access to Land Securities’ highly skilled people across different disciplines, who will share their expertise, offer mentoring and help the entrepreneurs accelerate their start-ups’ growth. We will also offer TrueStart access to our portfolio of premium retail locations across the UK.

My aim is to ensure that these creative ways of thinking thrive in our retail business, as dynamic and cultural change continues apace in the retail sector. It’s a challenge I will relish.

Leading the way in retail innovation

Foreword

6 We meet Karen Millen chief executive Mike Shearwood

Scott Parsons, managing director, Retail portfolio, Land Securities

spring 2014 spring 20142 3

10

14

14

When I first came to London there was a limited choice of cuisines, now London is the foodie capital of the world 23

17 Contents 4 News The latest initiatives

and retail developments from Land Securities’ shopping schemes

5 Retail deals Land Securities’ latest retail property deals completed in recent months

6 Interview Karen Millen chief executive Mike Shearwood on democratising luxury retail

10 Fashion Why premium fashion retailers are enjoying success

14 Leisure The importance of leisure to retail-led destinations

17 Development The Nova development is transforming Victoria, London into a vibrant, cultural destination

20 Leisure A new dawn has risen for innovative places to eat out

23 Initiatives Retailers are tapping into the fashion-hungry youth with student lock-ins taking place in UK shopping centres

26 Development Land Securities has teamed up with TrueStart, a venture to find real talent in retail

28 Space Changing shopper habits are creating opportunities for retailers when it comes to opening new stores and expanding space

30 Community Land Securities is set to launch a platform to communicate its Corporate Social Responsibility strategy

32 Retail view Land Securities’ Richard Akers and John Lewis’ Jeremy Collins on the state of play in the retail market

34 Portfolio An overview of Land Securities’ shopping centres, outlets and retail parks

News and deals

Fashion missionWhy Karen Millen plans to ‘democratise luxury retail’

Premium playersWhy premium fashion retailers

hold the key to success

Destination leisureThe importance of leisure

in retail-led schemes

Foodie generationRetailers seize opportunities as a new trend in dining out emerges

spring 2014

Produced by

Editor Charlotte Hardie

Writers Ben Cooper, Mark Faithfull, Gemma Goldfingle, Tiffany Holland, Alex Lawson, George MacDonald, Rebecca Thomson

Production Editor Tracey Gardner

Design forty6 design Ltd www.forty6design.com

Publisher Tracey Davies

For Land Securities

Claire Reynolds [email protected] T +44 (0)20 7747 2390

Sejal Lad [email protected] T +44 (0)20 7024 5411

© Retail Week

All material is strictly copyright and all rights were reserved. Reproduction in whole or in part without the written permission of Retail Week is strictly forbidden. The greatest care has been taken to ensure the accuracy of information in this magazine at the time of going to press, but we accept no responsibility for omissions or errors. The views expressed in the magazine are not necessarily those of Retail Week or Land Securities.

A1 is printed by Headley Brothers Ltd.

Ashford, Kent

spring 2014 spring 20144 5

Land Securities’ latest retail property deals to be completed in the UK in recent months

Retail deals

NumbER oF DEaLS Four

REtaiLERS aND Sq Ft

Falafel City 350 sq ft

Frankie & benny’s 5,041 sq ft

Wagamama 3,136 sq ft

Rossopomodoro 3,166 sq ft

Falafel City is open and trading.

The remainder are due to open

in spring this year

kEy StatiStiCS

5.1 million annual visitors

300,000 sq ft of retail and leisure

more than 30 million commuters

arriving/departing from four

tube/rail stations within a

10-minute walking distance

NumbER oF DEaLS Six

REtaiLERS aND Sq Ft

Pandora 823 sq ft

Phones4u 253 sq ft

Xile 3,822 sq ft

yankee Scotland 1,377 sq ft

muffin break 1,600 sq ft

kidzeco 2,676 sq ft

All retailers are open and trading

kEy StatiStiCS

1 million sq ft of retail and leisure

more than 150 shops

1million-plus visitors a month

NumbER oF DEaLS Three

REtaiLERS aND Sq Ft

Carluccio’s 5,220 sq ft

original Penguin 1,132 sq ft

Dr martens 2,068 sq ft


kEy StatiStiCS

425,000 sq ft outlet centre

91 premium outlet stores

32 bars and restaurants

8 million annual visitors

NumbER oF DEaLS Five

REtaiLERS aND Sq Ft

bose 2,330 sq ft

tiger 2,550 sq ft

the White Company 4,560 sq ft

Clogau 1,450 sq ft

Ecco 1,185 sq ft


kEy StatiStiCS

more than 180 shops

1.4 million sq ft of retail and leisure

18 million tourist visitors

The O2 CenTre, LOndOn

The CenTre, LivingSTOn

gunwhArF QuAyS, POrTSmOuTh

ST dAvid’S, CArdiFF

iniTiATiveS

Land Securities has teamed up with Glamour.com to host a special evening at six of its UK shopping centres at the end of March to help boost sales turnover and promote awareness of the centres’ extensive retail and leisure offer.

Timed to coincide with the arrival of New Season collections and just ahead of Mother’s Day, this latest promotion builds on the success of the Land Securi-ties’ student lock-in model. It aims to stretch and reward spend across ladies’ fashion, accessories, beauty and homewares retailers within a three-hour period.

The 37,000 women forecast to attend the one-night only ‘Treat Yourself & We’ll Treat You’ shopping event will be able to indulge in offers from their favourite brands and then stop off at the Treat Zone where the rewards get better the more they shop. On the mall, activity will also allow retailers to showcase New Season’s collections and engage shoppers in com-petitions to win must-have products. As a way to drive viral engagement, shoppers will also be able to create their own Glamour magazine cover and share with friends via social networks.

Engaging style-conscious females

DeveLoPMenT

Leeds City Council has given the go ahead to Land Securities’ expansion plans for the White Rose Shopping Centre.

Councillors supported plans to expand the shopping centre by 185,000 sq ft at a planning committee meeting in December.

The plans include a 12-screen cinema, 25,000 sq ft of restaurant space, 110,000 sq ft of A1 retail space and a 570-space car park.

Decisions are now being made about how the work should be phased, and details such as the S106 planning obli-gations are being agreed with Leeds City Council.

Stakeholders and community leaders are backing the proposals and Land Securities will be working with them to employ people locally and to provide training along with the job opportuni-ties as part of its continuing commit-ment to community engagement.

Thumbs up for White Rose expansion

Accommodating omnichannel Land Securities has

rolled out a next

generation web

platform to 14 of

its uK shopping

centres as part

of its investment in

an omnichannel future.

The mobile device-

friendly web 2.0

platform will improve

the user experience,

helping people find

relevant information

quickly and intuitively.

it also showcases

retailer offers and

videos through

embedded rich

media content and

social media feeds.

Interview

spring 20146 7spring 2014

It’s been a busy first year in charge of Karen Millen for chief executive Mike Shearwood. The womenswear retailer has undergone a slick rebrand and now has an eye-catching new logo, a sleek new store design and two flagship stores in the offing in the world’s most premium postcodes.

Karen Millen is opening a New York flagship in the spring and the ink is just drying on its new three-floor store in London’s Knightsbridge, sandwiched between Harvey Nichols and Harrods. “This gives us a triple-fronted presence in one of the most prestigious streets in the world,” says Shearwood.

The new prestige sites define where Shearwood is aiming to position the brand, as a luxury retailer. The Karen Millen boss has identified a gap in the “accessible luxury” market, with no global retailers offering affordable, premium product, and he is on a mission to ensure Karen Millen fills that gap.

However, this is no mean feat for the retailer. “Internation-ally KM’s perceived at a level more premium than in the UK,” explains Shearwood.

“In the UK, there were people who passionately loved the brand who were saying ‘it’s great quality’, ‘it’s really stylish’

Karen Millen chief executive Mike Shearwood is on a mission to “democratise luxury retail”. He tells Gemma Goldfingle of his grand plan

then there was part of the population who thought it was high street and a bit WAG-like.”

Shearwood admits that the disconnect is down to the retailer not fully explaining its true point of difference. “We’re actually a fashion house,” he explains. “Every single item is designed in-house utilising our atelier.”

Inside its Shoreditch HQ is a thriving design studio, with pattern cutters, designers, graders and garment technologists hard at work in a scene one would expect from a top Milanese label.

“The majority of our fabrics are Italian,” says Shearwood. “We develop a lot of the yarns ourselves and with new techniques. The process is very much couture-inspired but the consumer facing part of the business has been traded as a high street brand.”

So he and his team set about changing the brand’s high street perception and carving out a niche for the retailer in ‘affordable luxury’.

Exclusivity of product is key to its luxury positioning. “If you think why people are prepared to pay more for garments, it’s not just about quality, it’s about brand perception, which is driven by exclusivity and g

Fashion mission

Interview


knowing that they’re not going to see a lot of people wearing,” he says.

Karen Millen has short product runs with just 50 to 250 items made in some cycles, explains Shearwood. This compares with 80,000 items that some high street retailers produce. Shearwood is looking to enhance this further by spreading its product wider overseas so there are fewer items in each country.

Changing brand perceptionsMarketing will play a crucial role in moving away from the flashy, footballers’ wives reputation and Karen Millen is investing heavily – a move that is long overdue, according to Shearwood.

“We’re absolutely confident that the price and quality of the garment is more compelling than the competition but we haven’t made a lot of noise about the brand for a long time. A new brand would enter the UK and spend significantly more on marketing than we ever have.”

It enlisted famous photographer David Bailey for its autumn campaign last year to help kick-start the rebrand. The campaign focuses on close-ups of the models and clothing to highlight the detail and craftsmanship of its products.

It also strives to show that Karen Millen was more than just a dress brand. “The range is broader than most people perceive,” Shearwood insists. “We have more than 600 SKUs per season from leather and denim to separates, knitwear, coats and dresses.”

Shearwood admits that the product in its smaller conces-sions has a dress bias but it is rectifying this in a move that could broaden its appeal.

“There is a whole generation out there who haven’t consid-ered Karen Millen, as their perception is that it’s just a dress brand and that’s our fault because we haven’t done anything to make them think any different. We’re trying to introduce the brand to new clients while trying to retain our old clients.”

The rebrand also extended to its store experience, a key part of its strategy for “democratising luxury”, says Shearwood.

“Sometimes the luxury experience can be quite snooty but fashion is fun. We want to create an indulgent, informed, fun experience for our clients,” he says.

It has reduced the number of sizes it displays in store to allow the products to breathe and make it easier for its customers to shop.

Karen Millen has also launched its ‘Client First’ initiative to help educate its store staff on how to improve customer experience. This includes information about the fabrication of its products. “Differentiating yourself through your service offering is one of the hardest things to do because it is about consistency of delivery. But it’s the hardest thing for your competitors to emulate,” he says.

Shearwood predicts that in-store experience will become the new battleground in retail. He believes that while the growth of multichannel means that fewer stores are required, they are, in fact, more important than ever. Stores will need to become more experiential to woo customers, he argues.

DIGITAL DEVELOPMENTS

Mike Shearwood was one of the first

retail chief executives to truly back

multichannel retail and during his

time at Aurora Fashions he coined

one of retail’s most used buzzwords

– omnichannel. The group, of which

Karen Millen was part of, carved a

reputation as an innovator in the

field, spearheading initiatives such as

mobile point of sales, with employ-

ees armed with iPads on the shop-

floor, 90-minute deliveries and using

a single stock pool to fulfil orders.

Shearwood says digital has been

a major competitive advantage

for Karen Millen, especially given its

small product volumes.

“When someone really wants

something, the last thing you want as

a retailer is to have that product in

a store that is not accessible to the

client,” he says. “Having one stock

pool enables your customer to find

that scarce product online and has

improved our full-price, sell-through

rate and has enhanced our margin.”

However, Shearwood says the

store will continue to be a key part

of the shopping experience. “Clients

enjoy feeling and touching product,

they enjoy shopping with friends. But

they are more informed about the

garments they’re buying, the price

they pay and the quality and the use

they’ll get out of them, and the inter-

net has helped them do it,” he says.

He says online and stores comple-

ment each other and points out

increasing numbers of shoppers are

coming to store with pages printed

from the internet while others try on

garments in stores and buy at home.

“You have to embrace it because

if you don’t offer the client the way

they want to shop, they’ll go some-

where else,” he says.

Karen Millen has also recognised

the importance of multichannel

to its international growth and has

begun rolling out websites for its

international franchise partners to

operate. Shearwood believes that

retailers cannot ignore the role that

multichannel plays in a franchisee’s

world and by giving them control of

the website it encourages them to

promote the channel.

“When I started in fashion retail I was told that product is king. Your stores could be terrible, your service could be appalling and as long as you’ve got great product at the right price it will sell. Now, that’s not enough,” he says.

“For merchant retailers, you can see the same trends across the high street. You need to do more than product – better store environment, better store experience, a good digital offering, a clear tone of voice, consistent price architecture. Retail has become more complex as the consumer is now more educated and discerning. Retailers have to do so many things better than they did.”

Climbing the ladderShearwood, who joined Karen Millen last March from former parent firm Aurora Fashions, has a long history in retail. Over the past 15 years he has worked in fashion, however, he started his career as a qualified optician rising through the ranks of Vision Express, notching up many director roles from operations to services to business development.

His well-rounded skills gave him the push global fashion giant Inditex – owner of Zara – needed to spearhead its UK expansion. He joined as UK managing director of Inditex in 2000 when Zara had just a handful of stores. When he left for Aurora predecessor Mosaic in 2007, Zara had more than 60 shops and was becoming one of the UK’s favourite fashion brands.

His experience at Inditex, the world’s biggest fashion brand, will help him in his quest to build Karen Millen’s international business.

The retailer already has a vast overseas presence, trading from 58 countries. By the end of the year that number will rise to 65 with 40 new stores planned in territories such as southeast Asia, central America and even Outer Mongolia on his hit list.

Shearwood says its broad range has appeal across nationalities and culture and says its “well-educated, confident, feisty” customers are a very international audience. But he says its rebrand has been essential ahead of its international push, as a global brand needs to generate a “consistency of opinion”.

“That’s not saying that everyone needs to like it but they need to agree on what it is,” he explains.

The focus on affordable luxury presents Karen Millen a golden opportunity to prosper as very few global womenswear players operate at its price points. Shear-wood says the complexity of global fashion has put retailers off.

“It’s not an easy thing to do, to operate in the same season across massively diverse temperature zones,” he says. “I was on a trip to Asia recently and Beijing was -12 degrees and Singapore was 33. That makes it hugely complicated.”

But these are complications that Shearwood and his team have clearly overcome as its overseas business now accounts for 65% of sales. And now that it is suited and booted with a new brand image, there seems no stopping Shearwood’s overseas invasion as further countries have luxury democratised. l

Report


You only need to look at the numbers to see that the 2013 Christmas period was a good one for premium fashion retailers. At Jigsaw, like-for-like sales were up 17%. Jaeger boasted an impressive 32% jump over the period. Karen Millen, meanwhile,

produced a 12% increase, with the retailer operating from 400 stores and in 58 countries.

These heartening performances came in an environment that was still challenging for retailers. The British Retail Consortium (BRC) reported overall retail sales rose 0.4% compared with December 2012, highlighting the extent of the achievement for the premium sector.

The success of this category is understood best when you realise that this strong performance hasn’t been limited to Christmas. Over the past five years the premium category has gone from strength to strength, with brands including The White Company, Whistles, Karen Millen and Coast all increasing store footprints and growing sales across channels.

“The premium market has definitely recovered quicker than the mass market,” says Jaeger chief executive Colin Henry. “We are optimistic about growth.”

Peter Ruis, chief executive of Jigsaw, adds: “If you are at the slightly more premium end of pricing, you have more tunes you can play in a very difficult economy.”

Customers clearly like what the premium mass market is offering them. For Henry, the polarisation trend of the past few years is one of the main factors supporting growth. He says: “The top end and bottom end of the market could poten-tially grow at the expense of the middle market. People are prepared to spend more money for a higher-quality product.”

Ruis agrees and says premium pricing gives a retailer more room to breathe. “You have to have something to play with. At the lower end of the market, there’s not a lot of margin to play with. You are always going to get beaten on price.”

He adds that one of the things the premium market has in its favour is what every retailer needs to survive – something unique about the brand. “It’s the same old clichés of a differenti-ated, authentic proposition.

“If you’re innovative and differentiated you’ve got a chance. It’s easier to be that way at a more premium end,” he says.

Didier Drouet, chief executive of LK Bennett, says this

Premium retailers are having a good time of things. Rebecca Thomson looks into why the sector has enjoyed such success recently

differentiation allows them to build a loyal customer base. He says: “We have a dedicated client base who purchase invest-ment designs that are timeless with a twist. We also benefit from customers who are trading down from luxury but are unwilling to sacrifice workmanship, design and quality. In recent seasons we have seen a strong reaction to our more directional fashion product, which signifies a renewed interest from our younger, more trend-focused customer.”

Ruis adds that the touches that make a brand more individual are the same elements keeping customers coming back. “Design integrity, customer service. Consumers are clever people.”

David Harper, founder of property agency Harper Dennis Hobbs, says premium retailers have thrived as customers seek escapism from a bleak economic atmosphere. “People get bored of the recession. They want to go out and treat themselves.”

This is often easier to do at premium retailers than at the luxury end of the market. LK Bennett director of merchan-dising Sarah Thornley says: “There has been a steep rise in prices at the top end of luxury brands in recent seasons. This, along with a general mood for less conspicuous consumption post the global recession, has created an opportunity for afford-able luxury brands.”

The journey hasn’t been an easy one, however. The recession has claimed retailers including Nicole Farhi, and those that are left have learnt the hard way how to operate in the new climate.

Ruis says: “Pre-Lehman brothers, in 2008, it was a very benign economy. As long as you were half decent you would do well. Now, you have got to be good to do well – and you’ll soon find out if you’re not.”

Harper puts it bluntly. “As the recession bit the [weaker] retailers went out of business. We were left with the good retailers. They have had to get better because of the changing market,” he says.

Pre-2008, retailers might have got away without a strong online presence – not anymore. Ruis says: “You can’t survive without a good digital platform, and increasingly some of the digital players can’t survive without stores. It’s more complex. Everything’s the same, but at the same time everything’s different.”

He says customers still love shopping, and they like going into shops. “If you do surveys consumers say they love g

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ApremiumpeRfoRmAnce

Premium ChriStmaS SaleS

Sales results from retailers that publically announced Christmas performance

Store sales

(% change in like-for-like sales 2013):

Jaeger +23%Jigsaw +17%Fortnum & mason +13.4%

Online sales

(% change in like-for-like sales 2013):

Jaeger +57%Jigsaw +39%Fortnum & mason +26.4%

Source: OC&C Strategy Consultants

g

13spring 2014

Report

spring 201412

If you are at the slightly more premium end of pricing, you have more tunes you can play in a very difficult economy peter Ruis, Jigsaw

Q&a: Will Kernan, ChieF exeCutive, the White COmPany

Why have consumers responded so well to The White Company’s brand and proposition?the White Company brand has been built on bringing our customers everyday lux-

ury at affordable prices – the latest catwalk trends and cutting-edge designs are

not as important as impeccable style and great prices for the exceptional quality

we provide. We’re all about timelessness, attention to detail, and understated

elegance while being practical and versatile. Product quality is key. newness is im-

portant but only where it builds on our brand credentials and lifestyle proposition.

What does The White Company bring to a high street or shopping mall that other retailers do not bring?Our customer loves the combination of the sensory experience of our stores, as

well as the oasis of calm, excellent service, exceptional guidance and personal

advice that our in-store experts deliver.

What role do stores play in The White Company’s proposition and strategy, and how important are stores to the brand?While the White Company originated from direct to home retailing and now

operates a highly successful ecommerce site, our stores are vital to the brand and

proposition, and strategy. more than half our turnover comes from stores. While

the role of the store is clearly changing, with an integrated approach to retailing

now needed across all channels to market, it is the stores that really allow us to

differentiate ourselves. it is the place where the theatrics truly take place; where

our customers get the chance to touch, smell and feel the quality of our product

and see our entire lifestyle proposition; and the place for human personal guid-

ance and advice from our in-store experts. For now, at least you cannot do all

of that on an iPad.

What opportunities are there for The White Company in the UK market?there is significant opportunity to grow further in the uK both with new store

locations and further online development, in addition to the obvious international

growth opportunity. in many parts of the uK we’re still something of a hidden

secret. there is a clear opportunity to recruit many new customers to the unique

the White Company brand, both here and abroad.

How do you see the brand and proposition developing? We’re focused on making the shopping experience more integrated across each

of our channels to market. We want to make it easier for our customer to shop

how she wants, making the brand even more experiential across all customer

touchpoints. it will raise the bar even further on service levels and make interaction

and communication to our customers more personalised. all of this while obviously

further refining and improving the product we sell.

Q&a: Jane ShePherdSOn, ChieF exeCutive, WhiStleS

What have consumers responded well to in Whistles’ brand and proposition?i think that consumers

have responded well to

a quality, edited collec-

tion that represents the

key trends of the season

in a wearable way,

and that is accessible

in a way that designer

collections are not. She

has come to trust that

Whistles’ interpretation

of the seasonal trends

is one that will work

for her.

What does Whistles bring to a high street or shopping mall that other retailers do not bring?Because the collection is limited, we’re forced to spend

more time reviewing and editing it so that the pieces

that remain are exactly what our customers want. Our

customers get a level of quality in terms of fabric and

make, and design that they do not get on the rest of

the high street.

What role do stores play in Whistles’ proposition and strategy, and how important are they to the brand?Our stores are very important as a showcase for the

range, and as a place that our customers can come

for style advice and outstanding customer service. Our

staff are carefully chosen for their advanced social skills,

personal style and willingness to go a little bit further than

is expected. Our store staff are very special. Online sales

are obviously becoming more and more important to

us, but we feel it is crucial to combine the service that

we offer in store with an extremely flexible online delivery

service to give our customers the full Whistles experience.

anything in our collection can be bought from any of our

stores, or from our website, wherever it is, and delivered

the next day to wherever the customer wants it – nothing

is a problem.

What opportunities are there for Whistles in the UK market?We’re still looking to expand in the uK, as there are

many cities and regions where the brand is

unrepresented, and that we feel the whole brand

experience is missing.

How do you see the brand and proposition developing?as we expand the brand internationally, we’re learning

how customers respond in different parts of the world. We

need to be aware of and respond to such differences.

We’re also introducing a menswear range to comple-

ment the women’s offer in September.

Premium retailers such as Jigsaw (left) and reiss (right) are going from strength to strength

shopping, and they define shopping as visiting shops. They see online as convenient and providing the ability to research.” So far, nothing much seems to have changed from the early 2000s.

But Ruis adds: “What has changed is how we measure success. It used to be all about like-for-like growth and how much extra space had been added. It was a very linear model. These days, you could be running stores that are flat or even losing money, but be doing a really good job. There’s a very different rhythm.”

Now, instead of looking at each store in isolation, retailers must measure success in a more holistic way, says Ruis. “You have to look at every channel you’ve got,” he says. “Online, the concession model, the concession’s website, and add them all together. Our web business is currently 46% up year on year.”

The stores, meanwhile, might be judged on footfall or on number of transactions, but what is clear is that premium stores have fitted neatly into the multichannel model. Customers enjoy using them as a support network for the online channel – they provide service, a chance to touch and feel product, and they act as a showcase for the brand.

Henry says Jaeger’s stores are a crucial part of the business’ success. “Stores are fundamental in terms of the service propo-sition. Our relationship with consumers is absolutely critical.” Stores, he adds, are the most important part of maintaining that and ensuring that Jaeger continues to be differentiated.

Premium shoppers have taken to multichannel shopping like ducks to water – a third of online orders are via click-and-collect at Jaeger, while mobile spending continues to rocket. In 2012, 18% of online orders at Jaeger were

completed on a mobile device – in 2013 this rose to 30%.Ruis says this changing environment is exciting, but adds

it’s a challenge too. “There’s plenty of room to develop, but you have to keep four or five plates spinning at the same time. Maybe in the past it was one or two. You can’t let your stores be average; you can’t not use all the digital channels. You need a social media presence. There’s a lot of different things to maintain.”

It’s not all about learning new retailing methods, however – some of the problems facing premium retailers are old school. One of these is the prevalence of discounting. Another reason many of the premium players did so well this Christmas was that they steered clear of the aggressively promotional environ-ment that several mid-market players were part of.

Ben Perkins, head of consumer business research for Deloitte, says: “Their [premium players’] performance this Christmas crystallises the things that they do well, allowing them to prosper. Typically they held their nerve and didn’t go early to Sale when November had a slow start. This meant that when the peak period came late, they had their stock. For me that embodies that confidence in terms of their product, and understanding who their customers are and what they want.”

Ruis says it was crucial to hold off discounting, but it’s not easy to do so. “The big challenge is avoiding discounting. The premium channels have become very discount driven. We were aware of competitors giving an offer every week.”

It’s not an easy time for premium retailers, but they have risen to the challenge. 2014 is likely to see many of them rising even further. l

Report


“Leisure has become a vital part of any retail destination,” reflects Polly Troughton, head of leisure for Land Securities. “A good cinema and catering offer extends dwell time, it creates hot spots, and it reinforces the social and human experience of visiting a centre and supports the retailing in that location.”

Troughton is in the ideal position to comment. Not only has Land Securities significantly upped the depth and breadth of its leisure offer in its shopping centres and retail parks, but it has also snapped up one of the largest leisure funds in the UK – taking it from a business without a dedicated leisure offer to the UK’s largest owner of leisure properties, all within the space of 18 months.

The X-Leisure Fund boasted about a dozen investors, ranging from institutional funds and pension and life funds to private equity investors and included two major stakeholders, AREA Partners and Capital & Regional. Land Securities

Land Securities’ purchase of X-Leisure not only secured a prime leisure fund but also underlined its view of just how increasingly important leisure is to retail-led destinations. Mark Faithfull looks at what the deal means for the company’s portfolio

established its own 12% stake on the secondary market, before negotiating with the two largest shareholders to buy their combined 42% holding, which included the management company. In autumn last year, Land Securities acquired an additional 35.6% interest in the X-Leisure Unit Trust for £104m, taking its total ownership of the Trust to 95%.

In doing so, Land Securities acquired a portfolio of 16 schemes, totalling 3.1 million sq ft of prime leisure and entertainment space. It includes Xscape in Milton Keynes and Brighton Marina, encompassing cinemas, the largest real snow slope in the UK and other sporting attractions such as climbing walls, indoor skydiving and surfing. There are also a host of family offers such as bowling, entertainment centres, water parks, bars, restaurants, clubs, health and fitness, bingo, urban and lifestyle retailers, extreme sports retailers and coffee shops.

The move reflected two important objectives for Land

Securities – the first to mark itself out as a significant leisure landlord in a market which has long-term growth potential; the second to reinforce its leisure expertise in its traditional malls, retail parks and designer outlets across the UK to boost the customer experience and, consequently, the vitality and success of those centres.

“In 2010/2011 we could see retailers’ growth slowing and yet the leisure operators were bucking the trend,” recalls Land Securities head of retail portfolio management Ashley Blake of the initial move for X-Leisure. “When we looked at the history of leisure in other downturns we could see that this was a resilient sector and that we were also seeing cultural changes in the way people liked to eat healthy food on the go, the rise in casual dining and how people were becoming increasingly time-conscious.”

While building its stake in X-Leisure, Land Securities was also busy bolstering the leisure in its own retail schemes. The most obvious fruition of this approach is at Trinity Leeds but Blake points to a wider influence – starting with the influx of cinemas into the company’s projects.

“It’s testament to how much things have changed that securing a cinema operator anchor has become perhaps the second or third priority when establishing a new scheme or major extension,” he says. “Both Oxford and Glasgow will have major new cinemas, as will Ealing [London]. We have put a major operator into White Rose, while of course we went with Everyman at Trinity Leeds, a unique, boutique experience to appeal to the urban, chic crowd in Leeds’ city centre. Not every project has to have a huge multiplex, some of our schemes will work perfectly with a five or six-screen cinema because the operators have become incredibly well drilled at creating enticing offers for customers.”

Blake thinks this flexibility and the enduring appeal of cinemas and the complementary food and beverage offers are crucial in boosting the vitality and identity of shopping centres. He points out how they can help shape flow, trading hours and the image of a destination. g

The

leisure principle

X-Leisure venues

n Xscape Yorkshire

n Xscape Milton Keynes

n Bentley Bridge

n Boldon

n Brighton Marina

n Cambridge Leisure

n Cardigan Fields

n eureka

n Fountain Park

n Great north

n Lockmeadow

n Parrs Wood

n Queens Links

n riverside

n Tower Park

n West india Quay

Al fresco dining at London’s West india Quay

indoor climbing at Xscape Yorkshire

Report

spring 201416

“From a retailer perspective, I would be feeling nervous if my landlord wasn’t putting in these offers,” he says. “There is no doubt that shoppers are looking for the full package and often a whole-day experience. Leisure makes for a much more compelling experience and increases dwell as well as extending trading hours, which will draw in more customers.”

By the time the X-Leisure team came within the umbrella of Land Securities, the company had established a strong food and beverage and cinema expertise of its own. The team, under the auspices of Troughton, has been integrated into the fuller Land Securities operation. Blake believes that this gives the company a unique ability to help leisure operators transfer into the retail space, and retail operators to move onto leisure parks. “It’s not just about shopping centres,” he points out. “We recently opened a Nando’s at Lakeside Retail Park and it is trading very well.”

Indeed, Land Securities has established a diverse mix of family catering offers on its parks, including Pizza Hut, Subway, Costa, Starbucks, Nando’s, Ask, Chiquito and KFC.

Troughton joined Land Securities from X-Leisure as part of the acquisition of the management team and, as head of leisure, is leading integration of her team in the company. She also notes the rising popularity of leisure and adds: “At a time when retail was struggling, we had very low void rates, long leases, high demand, and people still spending.”

The X-Leisure team is not only working on that portfolio but also providing advice and expertise across Land Securi-ties holdings. “It’s early days,” she explains. “However, with a busy pipeline we’re helping to guide the leisure strategies in places like Oxford and Glasgow, while looking at the strate-gies to develop the existing estate and any new acquisitions.”

Troughton believes that the overriding recent trends – the general rise of food and beverage, the expansion of casual dining and the inflow of new concepts – will continue, especially as out-of-home eating occasions continue to rise. “But what we do see is that the experience of eating at a retail destination is very different, because it’s part of a day out,” she says. “As a result we foresee that more of those eating experi-ences might involve say making your own pizza, or preparing and cooking your own food under guidance – so that it is more of a participatory event.”

She also notes that not everything has to be about newness, noting the revival of the TGI Friday’s brand through its dedication to hospitality and customer services. “They have created a unique experience and increasingly that’s what the customer is demanding,” she says.

Perhaps the most complete culmination of this new direc-tion for Land Securities could be at London’s O2 Arena in Greenwich. The company is in talks about the possibility of developing a designer outlet adjacent and, while nothing has yet been determined, Troughton reflects: “We have been able to hold discussions because of the reputation we have built around our own leisure proposition and experience. There is the potential to provide retail, food, leisure and entertainment all in one package – it’s what the future is all about.”

What seems clear is that the momentum behind leisure as an increasingly important element of retail-led destinations continues. There is a fresh generation of healthy, quick service and family restaurant offers coming to market and new takes on family activities from bowling and skating to cinema and education-based fun. “The operators have become very sophisticated and despite the discretionary nature of leisure, consumers’ enthusiasm is showing no signs of letting up,” says Troughton. l

MiLTon KeYnes: WhAT’s on oFFer

n snozone – real snow slope

n Airkix – indoor skydiving

n rock climbing

n Cineworld – 16-screen

multiplex cinema

n hollywood Bowl – 18 lanes

n Aspers Casino

n virgin Active – health and

fitness club

n 15 lifestyle, urban and sports

brand shops

n Bars, restaurants and cafes

n Wonderworld nightclub

n Corporate events

n special events

n John Butterworth Art Gallery

n Pay-and-display parking for

1,000 cars

BriGhTon MArinA: WhAT’s on oFFer

n 20 outlet shops

n 23 restaurants, cafes and bars

n David Lloyd health and fitness

facility with gym, pool, sauna

and restaurant

n rendezvous Casino – gaming,

dining and entertainment

n Cineworld – eight-screen cinema

n Bowlplex – computerised bowling

n neilson Active holidays – sailing

options (including corporate

events, race days, sailing/power-

boat courses)

n hotel seattle

n special events

n Free parking for 1,500 cars

indoor ski slope at Xscape Milton Keynes

The bar area at Maidstone’s Lockmeadow hollywood Bowl

Brighton Marina has a host of restaurants and bars as well as a cinema and the largest real snow slope in the uK

17spring 2014

Development

London’s Victoria – previously known for its bustling rail terminus and home for many of the Government’s civil servants for several decades – is rapidly transforming. While the complicated assemblage of some huge real estate –

ostensibly in the area directly next to Victoria station and towards Westminster along Victoria Street – went along comparatively quietly, the launch of Nova has now put Victoria centre stage.

The sheer scale of the development has enabled Land Securities to put in place a master plan to create the missing “sense of place”, says David Atcherley-Symes, retail leasing director for Land Securities, which will give Victoria a renewed sense of purpose and prominence.

That ambition is to be realised by the ongoing construc-tion and refurbishment of a series of tired office blocks, a number of which have been vacated by Government departments. The new buildings will provide world-class

The final piece of the Victoria master plan will arguably be the best yet, as Nova rises to provide a vibrant dining and cultural destination that encourages

people to spend time rather than pass through at pace. Mark Faithfull reports

offices, a carefully constructed mix of retail, restaurants, cafes and bars, a revitalised streetscape and public realm, and beautifully crafted residencies.

With an all-star cast of Google, Microsoft, Channel 4, Tom Ford, Richemont, LVMH and Burberry all making the area home, Land Securities wants Victoria to retain its own ambience. It scored a public relations coup when iconic footwear brand Jimmy Choo signed up for a head office at 123 Victoria Street.

In its original guise the flow ran along a corridor between Victoria and Westminster but with the new devel-opments Land Securities is creating flows to the north and south, which will help to increase the throughput of people further into Victoria encouraging them to discover the area’s hidden gems and historical side streets.

Land Securities also believes that its redevelopment work will act as a catalyst to attract independent retailers and further regeneration around its own projects, creating a fresh central London district.

Super Nova

g

Development


Nova, one of the developments in the Victoria area, comprises a 5.5-acre island opposite the main entrance to the station. It will include three buildings comprising offices, retail and residential accommodation. Atcherley Symes says: “It’s the biggest component in the best position, we’ve been saving the best for last.” It will see redevelopment focus immediately around the train station.

Phase 1 is due for completion in 2016, while phase 2 is to start following completion of the London Underground’s North Ticket Hall works in August 2016. Phase 2 will comprise offices, a library, 35 apartments and 11,000 sq ft of retail, and is due for completion in 2018.

Game changerLand Securities and its joint-venture partner for the Nova development, Canada Pension Plan Investment Board (CPPIB), has pulled no punches. It has declared Nova as the defining moment in the £2.2bn reinvention of Victoria and as a game-changing, 897,000 sq ft scheme delivering high-profile retail, cafes and restaurants and 16,000 sq ft of community space.

The transformation of this site is designed to deliver a new seven-day destination that will encourage the 115 million people who use Victoria station each year to engage with this part of the West End. Along with the five landmark buildings, Nova, Victoria will deliver a signifi-cant new public and cultural space, with evolving public art and outdoor dining. It will link Victoria station to the tourist destinations of Buckingham Palace and St James’s Park.

“Nova is undoubtedly the pinnacle of our regeneration of Victoria. What is important is that the public space is awe-inspiring and yet not overwhelming. It sits below bold architecture and it is about the sense of place and experi-ence,” says Catherine Thomas, head of marketing for the London Portfolio. “If you look at the lead employers, they know that the recruitment and retention of talent is becoming increasingly difficult in London and many of the new recruits are not interested solely in remuneration but in the lifestyle, corporate pride and ethos of the businesses they work for, which is why creating this lifestyle offer at Nova is so important to dovetail with the commercial space that sits above.”

The work in itself is a boon for the area’s traders. More than 800 jobs are expected to be created during demolition and construction. When completed and operational, Nova, Victoria will be home to more than 5,000 workers, residents and retailers.

Land Securities also wants to celebrate the intrinsic cultural identity of Victoria, not just its new additions. As Thomas stresses: “What is worth remembering is that there are plenty of hidden gems in Victoria. So aside from creating new developments we’ve been working to try and highlight those and to retain the heritage and historical links with the area’s past importance.”

To support the marketing of its residential Land Securi-ties has launched a new sub-brand ‘Residential by Land Securities’ in November. The Nova Building, Nova’s

area. “Although we felt a new fashion destination could be established, even in a mature market like London, this typically takes a long time. What really came across from the stakeholder research was the lack of a good-quality food and beverage offer in the area,” says Thomas.

That point is taken up by Atcherley-Symes, who says: “Victoria has a very mixed and very desirable catchment. On our doorstep we have the Belgravia, Pimlico and Victoria residential areas, we have commuters, the workforce, tourists visiting sites such as the parks and Buckingham Palace and, of course, theatre-goers. We have three theatres around us and we have signed a deal to bring a Curzon cinema into one of our other buildings.”

Because of that diversity, Atcherley-Symes envisages that the food offer will be equally diverse, including chef-led restaurants, casual family dining and eateries catering for meal occasions throughout the day. “In a location like Nova, Victoria it’s just as important to be able to get great scrambled eggs on toast in the morning as it is to eat a great steak in the evening,” he stresses. “Over the past few years London has become the food capital and we’ll be looking to bring some fantastic brands and names to cater to all requirements, both from the UK and abroad. They will be contemporary names, which can create enticing environments and that will take the whole food and beverage offer on.”

Thomas concurs: “What we’re seeing now is the emergence of some fantastic healthy fast-food options and the real focus on providence – from farm to fork – plus some terrific independents. Traditionally independent operators have struggled in major developments but that is changing. The owners are becoming very sophisticated and many of them are backed by investment money – so the issues of covenant and financing are becoming less difficult.”

A view to rememberAlso crucial to making Nova, Victoria a must-visit destina-tion will be the landscaping. Atcherley-Symes says Land Securities aims to create a “softer” ambience. That means lighter-coloured, hard-landscaping, trees, plantings and greenery and seating to create a calm and human-scaled public space.

“We’re conscious that the food and beverage offer will sit below three quite tall buildings and we don’t want them to feel imposing. We want the whole area and the dining experience to feel in tune with why people are there,” says Atcherley-Symes. “We’ll also be bringing in markets, exhibitions, music and art to the public realm, which is a key part of the post-opening management of the scheme.”

For now it is a balancing act, admits Thomas, between rushing ahead full-steam and holding back to ensure that Nova presents the best of the best when it opens. “When we developed Cardinal Place we brought in the great operators of the day such as Zizzi, Nando’s and La Tasca. But for Nova – although those operators continue to do a fantastic job – it is about bringing in the next generation of food offers,” she says. “In some ways it’s what makes a development like this so challenging, because on the one hand we want to get on with the leasing, on the other we have to balance the fact that delivery is still in the future and that we want the cutting-edge operators of that time. It’s also what makes these schemes so exciting.”

“When we look at the success of the food and beverage offer at Trinity Leeds, I think it has surprised even us just how enthusiastically those brands and food offers have been embraced by the local catchment. This is certainly not a Southeast phenomenon,” reflects Atcherley-Symes of the strategy. “At Nova we want to do something really special, it will be a dramatic change.” l

residential element, currently for sale, has proven extremely popular with both investors and occupiers who have been drawn to its Buckingham Palace Road address and its proximity to key London landmarks and beautiful Royal Parks.

Some 170 studio, one, two and three-bedroom, ultra-modern apartments and penthouses are to be completed in 2016 and will offer amenities including concierge services, a rooftop garden overlooking Buckingham Palace, a private cinema and gym.

The blend of residential, domestic and international tourists and working communities will be key to creating the vibrancy for which Land Securities is striving. It intends Nova, Victoria to become home to a constellation of coveted brands, new and old, that push the boundaries of the shopping and culinary experience. A cluster of inven-tive and inspirational restaurants, eateries, pop-ups, bars and retailers that create an unmistakable buzz – a micro-cosm of the best of London in the heart of Victoria.

“We’re looking at a collection of 18 units on the ground and first floors of three buildings, two of them commercial and one residential,” says Atcherley-Symes. “Having considered the offer in and around Victoria, we believe that the emphasis should be on food to create something that Victoria simply hasn’t had before.”

The rationale behind this strategy is based on the competing and established fashion zones in close proximity to Victoria, including the King’s Road, Knightsbridge, the West End and Bond Street. Land Securities did not want to replicate those offers and thought a food and lifestyle provision would best serve the broad mix of visitors to the

Along with the five landmark buildings, Nova, Victoria will deliver a significant new public and cultural space, with evolving public art and outdoor dining

mAster plAN: plp Architecture

Our master plan and designs for

three new commercial buildings

with retail space will regenerate the

island site to the north of Victoria

station. it ensures cohesion across a

series of buildings designed by three

leading architectural practices.

the master plan forms the larg-

est single-planning consent from

Westminster city council to date.

the project creates a well-designed

urban environment, enhancing the

public realm and architectural

quality of the area.

the development contains a

sustainable balance of uses, includ-

ing offices, retail, apartments and a

community space/library. pedestrian

routes and public spaces extend

across the site, with a north-south

thoroughfare with retail pavilions,

cafes, restaurants, public art, trees

and seating will become a public

space to host events. An east-west

route accentuated with a water

rill and planting leads to a more

intimate space enlivened by a

water wall.

Report


In the past few years, the UK’s behaviour towards food and eating out has changed beyond measure. A resultant ‘foodie’ generation has emerged. Consumers are more eager to try new and different cuisines, inquisitive about the food’s origins, and ready to tweet about their consumption before the

last mouthful has even been digested. This has presented new challenges to restaurateurs and

landlords alike. Where once a restaurant may have competed against a rival down the street, now several restaurants offering the same cuisine may be available in a single town, alongside a popular street food market and a host of online food delivery services.

The shift comes against the backdrop of a consumer under financial pressure who, while their purse strings may have been loosened somewhat since the economic downturn’s nadir, are still careful about every pound spent.

But the restaurant landscape offers plenty of opportunity. The flying start enjoyed by traders at Trinity Kitchen in Leeds, a first in the UK street food market that opened in October inside Land Securities’ Trinity Leeds shopping centre, shows that innovation is alive and well.

Land Securities leasing manager Andrew Turf, who worked on the Trinity Leeds project, explains how shopping centres in the future could have a distinctly different approach to its food offering. “The whole shopping centre model of ground and first-floor retail and the top-floor restaurants is archaic, boring and predictable,” he says. “You can have far more interesting options where you incorporate food and beverage throughout a centre. In the future, you could have a restaurant anchor tenant and build around it,” he says.

Innovation has also been key at the St David’s shopping centre in Cardiff where Land Securities has broadened the centre’s offer by hosting Bar 44’s mobile tapas concept – an airstream trailer serving Spanish food from a pitch outside, which hopes to capitalise on the popularity of street food.

As attitudes to food and dining undergo seismic shifts, restaurants and eating destinations are rapidly adapting to new trends. From increasingly popular niche cuisines to innovative formats for places to eat out, a new dawn has risen on the leisure experience. By Alex Lawson

But it’s not just in formats that stakeholders are having to tweak their offers to suit a changing consumer. Eateries are becoming more savvy in their marketing exploits from using smartphone location services to offer customers deals to providing wi-fi to increase dwell time in cafes.

Moreover, a trend towards convenience food shopping is echoed in the food-on-the-move market where brands such as Eat and Pret A Manger have expanded rapidly as time-pressed consumers seek a quick fix.

Innovative restaurateurs may also look to London’s trendy Shoreditch for inspiration from two off-the-wall projects. Russian cafe chain Ziferblat, which has opened in the east London hot spot, asks customers to pay 3p a minute to hang out but its food and drinks are free. Up the road, the much-hyped, crowd-funded project Lady Dinah’s Cat Emporium opened at the beginning of March with a troupe of feline friends to offer company for customers.

CUSP OF A WAVEIf formats and eating habits are changing quickly, then it’s nothing compared with the lightning pace at which new cuisines are being adopted in the UK.

One cuisine poised to explode in 2014 is Brazilian food. Buoyed by the FIFA World Cup, the South American culture, including its national dishes, is likely to take off.

Mintel’s Consumer Trends 2014 report predicts that the football tournament “is going to make the world fall in love with all things Brazil”.

“It has not hosted a World Cup since 1950 and, this time around, the showcase of Brazilian commercial cultural exports will encompass everything from food and fashion to beauty products,” writes Mintel senior trends consultant Richard Cope.

Cope adds that Brazilian meat and Churrasco grilled beef restaurant brands such as Rodizio and Braza have the poten-tial to appeal to the 60% of UK consumers who have not but

BURGEONING BRANDS

A number of brands are eyeing

significant expansion or have the

potential to grow exponentially. A1

looks at some of the front runners.

n Ceviche This Peruvian kitchen

and Pisco bar in Soho has

taken London by storm and the

concept was taken on a tour

of Britain last summer to great

approval.

n Pizza Union This Italian in the City

of London offers stunning value

for good-quality pizza, capturing

the eye of cash-strapped Britons.

n Tortilla The Mexican brand,

which features in Trinity Kitchen,

could easily ride the wave of

popularity for burritos and central

American food, with plans to

expand this year.

n Keu The growing trend towards

Vietnamese food may play

into this four-restaurant chain’s

hands, which has a branch in

London’s Vietnamese hub in

Old Street.

n The Alchemist This cocktail bar

from leisure firm Living Ventures

also features an array of cuisines.

The 40-restaurant group hopes to

expand into the South and plans

to open The Alchemist in the City

in May. It also opened its bar in

Trinity Leeds in March last year.

foodieThe

generATion

would like to visit a South American restaurant, according to Mintel research.

Serial restaurant investor Jamie Barber plans to roll out his Brazilian barbecue format Cabana and open new South American brasserie Hush this year as the cuisine rides high. Meanwhile, neighbour Argentina will continue to charm British consumers as brands such as steakhouse Gaucho expand and Santa Maria del Sur continues to be a standout destination in Battersea.

Looking East, Vietnamese is another cuisine enjoying a rise in popularity. Pho, a brand that takes its name from Vietnamese pho noodle soup, has nine restaurants, predomi-nantly in London. Buoyed by £5m investment in 2011, it now has seven restaurants in London, one in Brighton and one in Trinity Leeds. It plans to open four new restaurants this year as well as capitalising on the success of its first branches outside the capital to take its offer to two new restaurants outside London in 2015.

Co-founder Stephen Wall explains the brand has a strong niche. “We’ve got little direct competition, which considering the popularity of specialist pho restaurants in the US in particular is a surprise,” he says. “There’s been a good handful g

(Clockwise from top left) Chicago Rib Shack, Tortilla, Yo! Sushi and Pho are enjoying a rise in popularity as consumers embrace new formats and cuisines when dining out

Report

spring 201422

TRINITY KITChEN

One of the most significant shopping centre food

developments of the last year was the opening of Trinity

Kitchen in Leeds. The concept aimed to bring a first to

mall dining by channelling a street food environment

into shopping centre space. The inventive format aims

to showcase local and national cuisines alongside

major international high street food and drink brands.

Trinity Kitchen, which opened in October, brought

cooking demonstrations, street food vendors and pop-

up market stalls into a shopping centre environment.

It tempted brands including Notes, Pho, Tortilla and

Chicago Rib Shack north for the first time.

The dining area receives 35,000 to 40,000 customers

a week. Land Securities leasing manager Andrew Turf

explains the brands are “trading London-type numbers

from smaller space in Leeds”.

“We are learning a lot about food and food trucks and

the explosion of food culture. It’s become a great success

and I think the traders are trading fantastically well,” Turf

says. “I think food retail and experience is where it’s going

because you can’t buy a food experience online and

people want to check out the latest restaurant scene.”

Turf adds that influences for the project came not from

shopping centres but from innovative markets in New

York, hong Kong and Chicago as well as developments

such as Brixton Village in London.

But creating Trinity Kitchen was no small feat and came

with plenty of logistical and psychological hurdles. “At

Trinity Kitchen they hoist food trucks in and out every four-

to-six weeks, which is a challenge,” explains Turf. “We had

to maintain a can-do attitude throughout the process but

we got there in the end.”

Turf also believes the development can be replicated

in areas that are not metropoles. “I think Trinity Kitchen

could be rolled across the world from Shanghai to

Stockport. You do not have to commit the same capital

expenditure so you bring down the cost and prices so it

could be successful,” he says.

“You just have to bring in the local specialists. There

are plenty of people who would like something different

in every town. If you provide them with the environment

you do not have to be financially tied down. If you’re

bold there’s no reason it can’t work, but it has to be from

the people of Stockport for Stockport rather than ‘for

Stockport by London’.”

It’s a different experience in a shopping mall, it’s always semi-leisure. People need a pit stop if they are shopping for two- to-three hours robin rowland, Yo! Sushi

of traditional Vietnamese restaurants in London for some time, but over the last year or so the trend has leaned towards Vietnamese grab-and-go places in areas such as the City.”

Wall adds that Land Securities’ schemes prove an attrac-tive proposition. “They are great locations, well managed with a good mix of tenants. Land Securities is one of Britain’s foremost landlords and quite simply has some of the best opportunities for a restaurant such as Pho,” he says.

Another key trend set to step up in pace in 2014 is towards healthier restaurants. Wall argues that health has shot up the agenda and “nutrition is becoming a hot topic”.

Yo! Sushi chief executive Robin Rowland agrees. “What’s clear in terms of an underlying trend is that people are eating more healthily in the round. It’s not just the middle classes, everyone is thinking about the amount of sugar and salt in their diet in a way they didn’t 10 to 20 years ago,” he says.

Turf adds: “In London new openings will be more special-ised towards healthy food. People expect more health infor-mation and local products, as there is more attention on the provenance of products. Elsewhere in the UK, people are more value conscious and it will be about offering people rewards this year.”

There is little doubt the UK’s restaurant scene is in rude health. With a wealth of new cuisines and cultures set to explode on to British shores, landlords will have to move quickly to harness growing trends in 2014. The foodie gener-ation has truly been borne, but the question is what will foodie boomers’ children be eating in a few decades’ times. l

YO! SUShI

The Yo! Sushi story is one as bite-size and charming

as the products that travel its conveyor belts. First

opening in Soho, London in 1997, the UK’s first

sushi chain wowed customers with its product

offer and unusual dining experience to open

76 restaurants worldwide.

But the business is entering a new era with brand

extensions and international growth – it has even

considered delivering meals by drone but an ill-

fated pilot made a near-term repeat unlikely.

Of its 67 UK restaurants, some 35 are in shopping

centres and they are locations the brand performs

well in, chief executive Robin Rowland explains.

“In our case we have carefully targeted the top 30 shopping malls in the country. Everyone

said the advent of the internet would hit shopping centres and it’s impacted spending on

retail but eating out has held up,” he says.

“It’s a different experience in a shopping mall, it’s always semi-leisure. People need a pit

stop if they are shopping for two-to-three hours. Our core customers are CBD [central business

district] and are still aligned to food that’s in fashion.

“We’ve just had a great Christmas, which was ahead of expectations as the appalling

weather made people go to shopping centres, which have inundated their space with food

offers. Luckily we’re highly differentiated but it’s tough if you just have a standard offer.”

Rowland explains that the franchise brand is a versatile shopping centre tenant. “We can go

anywhere,” he explains. “We can put Yo! Sushi in the middle of Bluewater as we’ve devel-

oped a model, which does not need walls and extraction. We’re also good at food on the

move and have about a dozen restaurants in railways and airports.”

Mexican street food restaurant Tortilla

23spring 2014

Report

With more than 2.5 million students in higher education in the UK, student lock-ins at universities are a clear way to attract a captive audience. Land Securities was one of the

pioneers of a craze that has become a consumer marketing phenomenon. The events entice students to shopping centres brimming with cut-price offers from retailers, which aim to start what they hope will be a long relation-ship with the brand.

So just how valuable have these large-scale marketing events become in terms of sales and loyalty, both for retail schemes and the retailers within them?

Usually held once a year in the autumn, the three-hour lock-ins are designed to welcome the students at the start of their new teaching years. While primarily targeted at first-year students, they also serve as a loyalty reminder to those older students who have been before.

Students are swapping beers for bargains as retailers tap into the fashion-hungry youth with student lock-ins taking place as a national franchise

in shopping centres. Tiffany Holland reports

In 2010, Land Securities held its first lock-in event at the St David’s shopping centre in Cardiff, which has one of the UK’s largest student populations, making up a fifth of the population. This first event generated £166,000 of revenue, so the opportunity for growth was apparent from the start.

Suzi Arkley, head of consumer marketing for Land Securities, says: “We noticed that some retailers already saw the value of this core demographic. By scaling up the activity to accommodate the whole shopping centre, we realised we could create even more excitement for local students and, in turn, generate a greater impact for our retailers.” Four years on and Land Securities’ student lock-in has grown to 10 centres, involving 550 retailers and 100,000 students and netting £2.6m in revenue.

UK retailers have, for a long while, recognised the value of engaging with students. Many retailers offer student discounts throughout the year, but the lock-ins offer a more concentrated opportunity. And, with about 440,000

SHopping STudieS

g

Report

RetaileRs’ endoRsements

Tonight has been a resounding success for us – with sales up six times compared with a usual weekday. As a high-end brand and the biggest Vivienne Westwood store in Europe, we attract a lot of international students, firmly placing Cardiff on the retail map Vivienne Westwood, St david’s Shopping Centre, Cardiff

The store completely exceeded target and we were incredibly impressed with how much the centre pushed and supported the event Superdry, Trinity Leeds

schemes involved and 2013’s facts and figuRes

Overgate, Dundee 4,500 students, £169,575 sales

Buchanan Galleries, Glasgow 6,678 students,

£185,070 sales

Bon Accord & St Nicholas, Aberdeen 4,391 students,

£107,000 sales

Trinity Leeds 19,914 students, £565,000 sales

The Bridges, Sunderland 9,100 students, £178,000 sales

Princesshay, Devon 3,695 students, £117,370 sales

St David’s, Cardiff 27,222 students, £672,035 sales

Gunwharf Quays, Portsmouth 4,335 students,

£129,190 sales

Cabot Circus, Bristol 19,400 students, £442,206 sales

The Galleria, Hatfield 3,514 students, £76,559 sales

student lock-ins: the best appRoach

l the events aren’t simply a way to get people through

the door via discounting. they work best if retailers offer

extra value to students. What experiences can you offer to

create a buzz and interest them in your brand long term?

l promotion is critical. consider how you can spread the

word via social media, leaflets and so on.

l talking to centre teams to find out creative ways to

draw attention to your brand. they could offer extra

space in the mall for animation, for instance, or additional

sales points to showcase your offer.

l lock-ins are a great opportunity for collaboration and

cross-promotion. consider opportunities to work with other

retailers or caterers.

l for retailers interested in getting involved, email [email protected]


students living within the catchment area of Land Securi-ties’ participating centres, it has a clear business case behind it.

SuperGroup head of retail Claire Arksey says: “Students are obviously our main core customer and it allows us to focus and target a lot of students at once and help intro-duce them to the brand.”

SuperGroup has been involved in the lock-in idea from the beginning and took part in almost 60 events last year. This is despite the group’s no discount strategy – the lock-ins are the only time Superdry cuts prices and, at a generous 20% off, students queue out the door to get their hands on a bargain.

“As a brand we don’t discount so it was always going to be a concern,” says Arksey. “But I think what we’ve tried to do is not just offer a discount. We also put DJs on, ensure the team are engaging with the students and we do it just once a year.”

For such an important event, the retailers go all-out to entice the students in the hope they will keep coming back throughout their student life and beyond into professional careers.

Their offers are varied. Land Securities’ Arkley says health and beauty retailers such as Boots offer makeovers, while lingerie retailer Boux Avenue offers shoppers a glass of bubbly as they browse. At one Trinity Leeds event, footwear retailer Office enlisted the help of local artists to personalise footwear for customers.

“It’s about discounts and bringing life to stores. Retailers need to get into the spirit of the whole evening. And we know that dwell time is linked to spend,” Arkley adds.

And this marketing technique is not just the domain of those brands more typically associated with the student demographic. Those with higher price points such as Vivienne Westwood, Cath Kidston and jeweller Swarovski are also engaged with the events. The latter, for instance, proves particularly popular with international students because of the lower UK prices.

But, of course, effective marketing is critical. Success does not depend entirely on word of mouth. Land Securi-ties enlists help from event agency Total Students, which specialises in organising the events, and creating the atmosphere and buzz unique to a student lock-in. On the night, amid the music and party atmosphere, queue management systems are designed to safely stagger the swarms of students, while health and safety, cleaning and security are also taken into account.

Effective implementation requires promotion across multiple channels, starting with student venues. Flyers and posters are on display in student unions, fresher fairs, halls of residence and local bars and clubs. Social media and email marketing campaigns are also a priority, and these prove to be a highly cost-effective way of ensuring success – particularly given this age group’s high engagement with social media and digital channels.

The retailers in the centres contribute half of Land Securities’ marketing budget, so it is a combined effort. SuperGroup’s Arksey says it is crucial that the shopping

centre has good links with the local universities and, in turn, the retailer has a good relationship with the centre.

“We’ll look at [the shopping centre’s] social media and how many followers it’s got and check if it’s got a really good website because students are on there all the time,” she adds.

Schuh head of store operations Phil Whittle adds: “It is completely dependent on the marketing effort. We’ve had shopping centres that didn’t do lots of marketing and it didn’t work.

“We have been actively out there and we actually took the message to the centres and asked them to look at it.”

Schuh participated in 50 student lock-in events last year, which were broadly a huge success for the retailer. Whittle says they can be so successful that a store will take more cash in an hour at a student lock-in night than any hour over the usual Christmas peak, even with the 20% discount the retailer offers in store.

“It’s the biggest discount we ever do,” Whittle says. “We offer students 10% off anyway so we’re effectively doubling their discount for coming. And they’re very prepared to

come and stand in queues that go right the way out the shop. We try to tackle them with handheld tills but they’re the longest queues you’ll ever see in our shops.”

But with increasing university fees and a recovering economy, how do students have the money to spend?

Land Securities’ Arkley says: “Students still spend on the items they want and need, though perhaps the choices they make have changed over the years. With increasing finan-cial pressure, students look for money-saving offers, an experience and, ultimately, value for money.”

Whittle says students plan their purchases before they’ve even left their halls of residence. “It’s not just impulse. Students are very savvy. We have check-and-reserve where you can put shoes on hold for 48 hours. It means that we can tell you how busy we’ll be by 1pm that afternoon.”

So now that student lock-ins are a real date in the diary for retailers and students alike, the pressure is on to keep the events fresh. Land Securities is targeting brand involvement to offer more entertainment and experiences unique to the night.

Arkley reveals that Land Securities is even trialling different events this year following the student success. These include an event in April that will focus on the female demographic and a food-focused promotion in the summer, while it is also looking into how shopping centres can pull in Christmas sales earlier this year with a pre-Christmas event.

But it is unlikely Land Securities will increase the frequency of its student lock-ins owing to the strength of the autumn timing, although other centres including Trinity Leeds and St David’s have held smaller spring-time lock-ins.

These events are far more than just a fun PR opportu-nity. Their business value in terms of sales is tangible evidence of the importance of developing strong customer relationships. The term ‘lock-in’ is particularly appropriate – give the customer a first-class experience of your brand when they are young and you are locking in their loyalty and spend for years to come. l

in numbeRs

2010Revenue £166,000

Retail brands 51

2013 Total students 103,000

Revenue £2.6m

Retail brands 550 retail brands

(clockwise from top left) superdry’s store at st david’s in cardiff; street food on offer at princesshay in exeter; st david’s creates buzz and interest for students at its lock-in; hordes of students queue at st david’s lock-in in cardiff

Development


For any business to get started in this world it can take many things: guts, hard work, luck, or a combination of all three. But, sometimes, you get a helping hand. That’s exactly what TrueStart – backed by Land Securities – is all about.

The brainchild of Matt Truman, chief executive and founder of specialist asset management company True Capital, TrueStart is about giving young, fledgling tech companies with big ideas the chance to be retail’s next big thing.

The project has just been born in a new purpose-built office space in Land Securities’ Francis House in Victoria, London. A groundbreaking venture, TrueStart’s hub differs from other entrepreneurial centres in the UK, because it will specialise in nurturing retail talent alone.

Bright young lights with ideas to change the way retail works, from the shop front to the warehouse, have been selected, and now they are ready to begin.

The chosen few will be given rent-free, rate-free desk space in the 4,300 sq ft office, where they will work for the next six months, with the added bonus of £25,000 investment from True Capital for a 10% stake in their new business venture.

With 20 small businesses taking space in the hub every year, each gaining expert advice, financial backing and a wealth of retail connections thanks to Land Securities’ exten-sive contact list, it’s set to be a melting pot of activity and talent that veteran city banker Truman says could produce true, radical change in retail.

“The ideas can come from anywhere,” says Truman. “From field to shelf, from supply chain technology to data analytics. At this point they’re all different and at different stages.”

The past five years of downturn and a subsequent lack of lending have been tough on small businesses looking to get off the ground. Financiers run for the hills, risk is shunned and innovation can grind to a halt. A hard enough task in the best of times, getting funding for a new idea, however brilliant, has been too hard for many.

Now True Capital hopes to go some way to solving that problem for a lucky few. Under the guidance of True Capital partner and Cushman & Wakefield global head of retail John Strachan, Truman approached Land Securities with the idea in March last year.

Truman says: “We went to Land Securities for its reputa-

Land Securities has teamed up with TrueStart – a venture to find real talent in retail. By Ben Cooper

tion, as well as its excellent relationships with retailers and unrivalled scale across the UK. It became apparent its partnerships were going to be key, and the idea that they could provide a wide range of mentors into the hub.”

A win-win situationLand Securities got behind the scheme and the wheels began turning. Now, less than a year later, the office has been turned into the perfect hub, with shared space for the small teams to work in, cutting-edge technology and a giant screen for presentations and collective idea making.

Land Securities head of b2b marketing and brand partner-ships Sean Curtis says: “The hub creates a unique opportu-nity for us and our retail partners to access retail innovation, a chance for our key staff to work with entrepreneurs and for the fledgling businesses to benefit from direct access to a FTSE 100 company – in short it is a win-win for everyone.”

Budding entrepreneurs are being invited to first fill out an online application, which leads to a second stage at which the TrueStart team and their Land Securities counterparts choose a selection of the original hopefuls to progress to the third and final phase of the process.

With about 20 to 30 applications a week under considera-tion, and this rigorous process to go through, the hub, headed by music and publishing veteran Richard Mergler, is only for the serious entrepreneur, however far along the journey they are. Truman says the key is that they are passionate and willing to make the most of the opportunity.

“Some will be at the beginning, others will be three quarters of the way there – there is no stereotypical entrepre-

VICTORIA – LONDON’S NEXT CREATIVE QUARTER?

The area has already attracted some big names from the

tech, media and retail worlds, with Microsoft, Channel 4,

Burberry and Jimmy Choo among the companies in the

neighbourhood.

Key to attracting the talent will be the major 897,000

sq ft mixed-use Nova scheme by London Victoria station,

which Land Securities is developing jointly with Canada

Pension Plan Investment Board (CPPIB).

innovation in its own right. It will cultivate innovation for the whole industry and across the UK.

Land Securities is investing about £2bn in Victoria, which it says has been undernourished and is ready for a new lease of life (see box). While London’s East End is busy making a name for itself as a home of artists, designers and web devel-opers, Land Securities wants the West End to be known for world-class retail innovation. Truman says: “Retail has always been based around the West End – the East is very tech-centric, not enough of it is retail-focused.”

Like all good business deals, TrueStart is meant to be a win-win. As technology is becoming more vital to retailers, the next game-changer could be just around the corner.

With the hub, True Capital and Land Securities hope to not only nurture, but discover and get behind the big new things in retail technology to maybe one day roll them out in their own centres and to their occupiers.

Curtis adds: “Retailers want a landlord to be innovative. A lot of the big landlords spend a lot of money on consultancy for innovation; we’re creating an environment for people to innovate in. The more we invest in innovation the more we can be a promoter of change for our retailers.”

But that is still some way off. For now the project is taking its first crucial steps. Maybe not all the 20 businesses a year going through the hub will change the world, but they will have had the best possible start. And for those with the ideas the retail world is waiting for, their time is just beginning. l

Young, fledgling tech companies will be given rent-free, rate-free desk space in the 4,300 sq ft office, where they will work for the next six months; True Capital chief executive and founder Matt Truman (above)

big thingThe next

neur. We want people who live their business, we want to make them comfortable and we want to build relationships.

“We’re investing in them as well as mentoring them. It’s important that we’re all aligned,” he says.

One of the challenges, Truman adds, is not finding the right advice to offer. With his background working for big City firms including Deloitte, Lehman Brothers and JP Morgan, and the rest of the TrueStart team all specialist asset managers, there is plenty of wisdom. The challenge is finding the balance between nurturing but not smothering, and helping but not compromising the entrepreneurs’ ideas.

Project focusSo apart from the financial backing and a space to create, part of the goal of TrueStart, he explains, is to overcome one of the big obstacles of all new businesses. He says young chief executives can often spend far too much time hunting down investment and too little on the project itself. And while they’re pitching to potential backers, nimbler rivals are working away and often getting ahead of them.

Not only will TrueStart save them that stress, but for those selected they are given a working relationship with their backers beyond their six months at the hub. And if the right connections are made while they are in their new environment, partnerships between entrepreneurs might even be formed.

The TrueStart project fits into a grand plan for the area: to make Victoria a ‘creative village’ and a hub for retail

Report


The future and form of retail space has been one of the most hotly debated themes in the industry in recent years.

The advent of online shopping and rise of multichannel have resulted in an ongoing reshaping of retail estates. Some

famous names, such as Comet and Woolworths, have disap-peared entirely.

And the future of hypermarkets is now a problem perplexing big grocers such as Tesco as the viability of the format – once seen as the future of retail – is questioned.

But the fact is that some retailers remain hungry for space – as long as it is the right sort.

Changing shopping habits have created great opportunity in the convenience market. For instance, while fashion giant Primark continues expansion apace,

other retailers are reconfiguring space to ensure an optimal estate.

Convenience retail space is perhaps most obviously in demand, reflecting a shift in consump-tion patterns and creating potential much bigger than the square footage.

C-stores were among the big winners over Christmas, which proved tough for grocers generally. Sainsbury’s, for instance, revealed that its c-store division put on growth of 18% in the third quarter and generated its highest-ever sales of £7m on Christmas Eve.

In January, Sainsbury’s opened its 594th Local store in Balsall Common, Coventry – a red-letter occasion because it took the number of the grocer’s convenience shops past that of supermarkets.

The opening will certainly not be the last. Although

Sainsbury’s opened its first Local in Hammersmith, London, in 1998, the retailer says only 6% of the population lives within a 15-minute walk of a Local store so there is scope for many more openings. Sainsbury’s set a target of opening two new convenience stores a week during 2013/14 and has opened 73 so far this financial year.

According to grocery industry body IGD, the value of the UK convenience sector will rise to £46.2bn by 2018 compared with £35.6bn at the moment.

Sainsbury’s convenience director Simon Twigger says the convenience market has been growing at about 5% a year, so there is “a massive opportunity to take a share of that growth”.

Top-up shopShopping habits and hectic lifestyles are driving the growth of convenience, says Twigger. During the recession and downturn consumers became more anxious to avoid waste, meaning that top-up shopping and frequent visits to stores, as necessity dictated, became more prominent characteristics.

Similarly, time is increasingly precious to consumers, which means convenience stores can really live up to the name.

“The recession meant customers wanted to shop more often and manage their budgets,” observes Twigger. “Now there are more people employed than ever, but if you ask them between 3pm and 5pm what they’re planning to eat, a lot of them don’t know.” Sainsbury’s, he says, does not see such trends changing.

Sainsbury’s has expanded its c-store division by single store deals as well as significant acquisitions, such as that of the Bells chain in the Northeast.

Twigger is open to all methods of continuing to gain more convenience space and says Sainsbury’s is under-represented and keen to pick up more premises. “It’s a real mix,” he says.

Sainsbury’s will not have the convenience field to itself. Tesco, which already has almost 1,600 Express stores, also continues to expand.

Rival Morrisons, which was a late arrival in the market, is chasing space too. Morrisons opened its first M Local in 2011 and intends to have about more than 100 stores open by the end of the financial year.

The Bradford-based grocer last year bought 49 locations from the administrators of

defunct entertainment retailer Blockbuster and has ongoing requirements.

Premises, freehold and leasehold, measuring between 3,000 sq ft and 6,000 sq

ft are of interest to Morrisons, which will consider locations ranging from converted pubs to petrol stations to new mixed-use developments.

At the more premium end of the food spectrum, Marks & Spencer is also opening more

of its popular Simply Food stores. Since launch in Surbiton and Twickenham in 2001, the Simply

Food estate has grown to more than 400 shops.Food has performed well for M&S, even as its

general merchandise arm has struggled, and last autumn the retailer revealed plans for more Simply

Food shops in the UK, as well as abroad.

M&S’s plans show that convenience is not just about high street locations. About half of the 150 new stores planned will measure about 2,000 sq ft and will be run by existing partners such as BP and SSP in locations such as railway stations, motorway service areas and hospitals.

The remainder of the space, which will be owned by M&S, will measure between 10,000 sq ft and 12,000 sq ft, and trade from locations such as high streets and retail parks.

Revealing the expansion plans in October last year, M&S’s executive director, food, Steve Rowe, said: “This franchised and owned expansion offers us an opportunity to continue to grow our customer base and business, building on the progress we have already made.”

M&S’s move into locations such as hospitals follows WHSmith’s lead, which along with being well known for its convenience offer in transport hubs, the retailer has been an astute judge of new types of location.

WHSmith opened eight hospital stores last year and in fact runs two M&S Simply Food stores as franchises in Salford Hospital and Manchester Royal Infirmary. WHSmith is also trying out a convenience model in hospitals, railway stations and airports with Musgrave, the owner of convenience fascias Londis and Budgens.

It’s not just small space that retailers are interested in. Even though last Christmas brought the strongest internet sales in four years, one of the big winners was Primark – a retailer that has no online presence but whose stores remain destinations for cheap chic.

Over the Christmas, ABF-owned Primark generated sales growth of 12%, and an 8% increase in selling space was cited as a reason for success along with a like-for-like advance and improved sales densities.

For Primark, space growth remains at the heart of its business. As of January 2014, the retailer had 268 shops trading from 9.6 million sq ft of selling space. In this financial year the retailer is targeting another 500,000 sq ft, bringing the net addition for the year to 1.1 m sq ft – more than in 2013.

While the retailer is increasingly taking advantage of international opportunity, UK space remains on the agenda. There will be three new UK openings, including a relocation in Cardiff.

Relocations, typically to bigger premises, are happening not just at Primark. Other highly successful retailers are pursuing that option, including Sports Direct.

The sports retailer updated on its property strategy in its interim results last December. It said last year it shut 35 stores and opened 36. The average increase in store size was 60%.

Sports Direct says: “Although sales density dropped, the relocated stores achieved a reduction in the average store cost to sales ratio, thereby increasing net contribution per sq ft.”

There’s no doubt that online and multichannel will continue to grow, but successful retailers can see how to profitably add space.

Ownership of stores can be a competitive advantage, bringing services such as click-and-collect – an option increas-ingly available in the fast-growing convenience market.

While the space race may be over for some formats, it remains intense for others. l

The newspace raceChanging shopper habits are creating new opportunities for retailers when it comes to opening new stores and expanding their space. By George MacDonald

Report


Sitting in Land Securities’ Strand offices, Catherine Thomas, London head of retail, residential and office marketing, is frank in her assessment: “As a company we have been very good at CSR and all the things that it encompasses for a long time, but we haven’t

been terribly good at telling anyone about it.”That, however, is about to change. Indeed, it is already

changing, although you probably haven’t heard just yet. A campaign to bolster, integrate and communicate the company’s CSR strategy has already been launched internally and the process of expressing its achievements, objectives and aims to the outside world will kick-start through the umbrella framework Shaping the Future for Good in the spring. This will encompass Land Securities’ energy efficiency, community and charity works and will “run like an artery” through the business, ensuring that all decisions from development to community engagement are made against a remit of what positive impact those determinations will have on the wider community and environment.

“We have embarked on a big internal process to get the executive and management teams fully immersed in how this formalising of our approach will be translated through the business. But it is part of the board’s firm desire to leave a genuine legacy about the way we do business,” says an effusive Thomas. “There is no doubt it is going to challenge us. For example, if we present an out-of-town development to the board now, one of their first questions will be about what impact it will have, or what we need to do to make that devel-opment have a positive impact. It may mean we make different decisions to those we would have made four or five years ago.”

The strategy will encompass a range of initiatives, including energy efficiency, which is something Land Securities has been very vigilant about for some years. Thomas points out that the carbon reduction requirements place the onus on users. These highly energy efficient retail schemes are vital to the store tenants in meeting their own obligations. This

Having developed a sophisticated and broad Corporate Social Responsibility culture, Land Securities has integrated its activities and is set to launch a platform to communicate its strategy. Mark Faithfull reports

also creates a strong investment vehicle, as high energy-rated buildings become increasingly important in sustainable long-term projects. “We do, of course, recycle some of our buildings but overall we tend to develop, hold and manage our developments so that means we are in it for the long term,” Thomas says.

Part of the communityCommunity engagement is an equally broad area and one in which Land Securities has been very active on a number of fronts for years. Trinity Leeds is a prime example of the wide-reaching impact a scheme can have on the local commu-nity. The figures speak for themselves. For instance, 1,144 32-month equivalent jobs were supported in the wider economy as a result of its development. In addition, £40,000 was awarded by Trinity Leeds to local community and charity groups, and more than 180 young people benefited from work-based training (see box).

Land Securities portfolio director, retail Gerald Jennings says: “The impact of Trinity Leeds on the local community has been extremely positive and wide-ranging – employing local people, working with partners to improve skills and job opportunities, engaging with and supporting cultural activi-ties, local charities and social enterprises, improving the public realm, reconnecting streets and redefining and revitalising the city centre, and encouraging further investment by others. Trinity Leeds has and will continue to invest as a key stake-holder in the city and its life and we see our responsibility to this community as one that creates jobs, improves skills and enhances the long-term economic and social health of Leeds.”

Land Securities has been working with the City of Westminster College and Tower Hamlets College in London to offer opportunities for young people to join the construc-tion industry, through a process that provides training, on-site opportunities and for some apprenticeships and jobs. So far more than 600 people – many of whom are among the economically vulnerable as former offenders and school drop-

TriniTy Leeds’ communiTy impacT by numbers

Skills, young people and educationn more than 180 people engaged

in training and work experience

activity

n 20 project-initiated

apprenticeships

n 30 school visits and site tours

n 18 college or school workshops

hosted by the development

team

Employmentn 622 equivalent full-time

construction jobs

n 55% from Leeds and yorkshire

n 1,144 equivalent full-time jobs in

the wider economy

The local economyn £20.6m paid to local construction

workers

n 100% of workers on and off site

paid national Living Wage

n £740m estimated gross economic

impact to uK economy from

construction

shaping The FuTure For good: a posiTive impacT cycLe

n by building sustainable places

that make good business sense…

n We can regenerate London and

strengthen communities…

n That fuel London’s economy,

creating demand for property

and construction

goodThe

outs – have been through the training and of those more than a third have found permanent positions as a result. “What I should say is that such is our network of partners that these roles are not jobs that will directly benefit us but rather that serve the industry,” says Thomas. “More than half of construc-tion site workers are aged 50 or over and we desperately need younger blood and also the newer skills in working with steel and glass construction, for example,” she points out. “There is no reason why those skills should not be homegrown rather than imported from the international skill set.”

The building of Trinity Leeds resulted in the creation of 622 32-month equivalent construction jobs, with 55% of the construction workforce being from Leeds and Yorkshire. A total of £20.6m was paid to the area’s construction workers.

Land Securities is also working hard to engage with the communities in which its retail developments sit, with Thomas pointing to the importance these schemes often hold within their local situation. That can be seen in the impact of a major project such as Trinity Leeds, which boosted the economy during the construction phase and has subsequently lifted the surrounding economy since opening. “We don’t want to drop a spaceship into a place and suck the lifeblood out of it, we want it to integrate with the local community,” says Thomas. That can be through on-the-ground activities

lIFe

such as ARISE, a trust whereby grants of up to £1,000 can be provided to scheme neighbours for everything from a wheel-chair to a school trip, or new playground.

Joining the dotsSo the new umbrella of Shaping the Future for Good is not so much about reinventing the business ethos but about formally integrating it within what Land Securities already does – joining the dots, as it were. In doing so, Land Securities does also hope that it will do good better. It is a project that Thomas readily admits will be intensive and challenging to establish in such a structured manner in the business culture. But once firmly intertwined it will make that ethos front-of-mind and a clear determining factor for how Land Securities conducts business now and going forwards.

“By putting everything under one umbrella it becomes easier to integrate all these various activities and to ensure that they work together, rather than as separate elements,” says Thomas. “It also provides us with a platform to communicate what it is we are doing and why. We would be the first to admit that it’s this component that is what we have been lacking and this initiative aims to reverse that.”

Thomas stresses that this is not about spin and having that platform will also enable the company to “unlock stories” in the business which, once validated and checked for their robust-ness can be communicated both internally and externally. The former has already started to happen, with plenty of visual reminders of success stories. The current future aspirations around the company’s offices also provide a daily reminder of the programme that has been set in motion. It’s a project that has been put firmly in front of the faces of the entire team.

Thomas is also quick to mention the importance of working with partners to enshrine the long-term commitment to the project. “There’s no point us creating a great big department dedicated to CSR and all these activities while times are good, only to axe it or reduce it in more challenging times,” she says. “What we have done is gone out and worked with as many companies as possible who share our vision. That means that the responsibilities to push it forwards sit within many companies and that should provide that long-term, sustain-able drive for the initiatives.”

Thomas also stresses that the importance of CSR has become even more entrenched in the retail industry than one might imagine and that expectations are high. She uses, as an example, numerous occasions where the likes of the big Italian luxury labels have asked the leasing team to provide details of the company’s CSR strategy and examples of how it does business from an environmental and community standpoint.

Having launched the initiative internally the continuing integration will continue, while the external campaign will get going in earnest over the next six to 12 months. For Land Securities it is about telling an untold story, about formalising its own approach and ensuring that it is optimised for all its stakeholders, from investors to staff to all those communities touched by the company’s activities across the UK. And, one senses, about the company taking something at which it is already a leader and embedding that expertise and ethos into the business, for good. l

We don’t want to drop a spaceship into a place and suck the lifeblood out of it, we want it to integrate with the local community Catherine Thomas, land Securities

The impact of Trinity Leeds boosted the economy during construction and once it opened

winter 201032

Fashion

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Retail view

32 33spring 2014 spring 2014

Q Many say London – and the Southeast – exists in an

economic bubble. What is your perception of the mood of shoppers in other areas of the UK? Collins I think the mood around the UK is remarkably resilient. We’re confident our shops are in the best locations. This, combined with the breadth of offer and quality of service, puts John Lewis in a strong position.Akers London is booming, benefiting from the globalisation trend and by being a stand-out global city. The UK will benefit from this in the longer term and we’re already seeing some of this growth spreading out to the regions.

Q Is enough being done to promote the positive impact

retail and developers can have on local communities? Collins There is an ongoing challenge with both politicians and communities, but the key to making a difference is leadership.Akers I’m afraid that there is still an attitude from many local authorities that retail provides the value that can then be used to regenerate wider parts of the city or the inclusion of other lower value uses. The reality now is that retail should be welcomed and encouraged because it adds vitality and benefits the community.

Q Did Christmas meet your expectations, and what does

this spell for the consumer mood for the rest of the year?Collins We’re pleased with the results over Christmas, achieving growth of more than 7%. We’re optimistic for prospects in 2014 as the economy slowly recovers, although the trading environment will continue to be competitive and challenging.Akers We have said for some time that structural change in retail would create winners and losers. I think Christmas was very much as we expected with many retailers including John Lewis doing well and some having difficulties, particularly with the timing of discounts. l

Q In this issue, we’ve focused on the role of bricks-and-mortar

stores in a retail brand’s story. Why are stores an important part of a brand’s identity?Collins Shops are at the heart of the John Lewis growth strategy and we continue to invest in both new and existing shops. Shops are important for brand representation, customer engagement, con-venience and consumer experience. Our research has shown that a bricks-and-mortar presence drives online share and therefore sales.Akers Strength of brand is going to be much more important for retailers in the future as it is such an important component in grabbing the attention of potential customers online. Building brand online, however, is very difficult and so stores give retail-ers a way of establishing their brand values face to face with customers and therefore enhancing sales across all channels.

Q How will the role of the store evolve in the future? Do you think

we will reach a stage where they are showrooms for product? And does it depend on the type of retailer or their target demographic? Collins The function of shops is changing and the role of the high street is evolving. We believe that customers will increasingly demand a more interactive and immersive experience from retail destinations. We’re continuing to innovate in our shops through product lines, catering, services and environment.Akers Different retailers will have a different approach. Some will use stores as a window to their product range, some will create a more experiential destination to more clearly illus-trate their brand values to existing and potential customers, and some will use their stores as mini

As the retail landscape evolves, consumers’ shopping behaviour is changing. A1 talks to Land Securities outgoing executive director Richard Akers in his final Retail View and John Lewis property director Jeremy Collins on the state of play in the retail market

Q The feature on the foodie generation shows just how rapidly

consumers’ tastes have changed. How challenging is it to keep up with shopper demand today? Collins Consumer expectation is changing at pace. Shoppers are demanding – and being given – a growing pool of channels through which they can buy the brands they love. We have a clear strategy to ensure that we use space, flexing what we offer, to encourage customers into our shops.

It is all part of our approach to driving interest and footfall to shops as online sales grow. For example, we expect customers to use little Wait-rose to pick up dinner on their weekly shop while picking up a click-and-collect order from John Lewis Watford.Akers This is the biggest question for the owners of major retail destinations. These schemes have to be kept up to date and relevant to customers and their expectations are changing very fast. This will lead to different lease struc-tures, different methods of investing in retail fit out and new concepts emerging. A great example would be Trinity Kitchen in Leeds, which is featured in this edition.

Q What is the secret to remaining relevant and adaptable in such

a challenging shopper environment? Collins Many successful retailers have an excellent physical presence where they grow an emotional relationship with customers, complemented by an effective, efficient and engaging online presence that can meet the need for convenience.

At John Lewis we are flexible so we can meet the needs of our customer. This is reflected in our hassle free and inspirational shopping experience, both in bricks and through clicks.

Akers The secret for the owners of shopping destinations is to give as many reasons as possi-ble for customers to visit. This can be by having a mix of the retailers that are the most attractive to customers, the best restaurant concepts, leisure or indeed events and digital advertising and delivery.

The reTail viewdistribution locations for servicing a burgeoning click- and-collect channel and accepting returns from online sales.

Q The trend towards smaller stores continues. How do you envisage

this playing out in the future? Collins The starting point for us is finding the ‘right size’ shop, in the right location, in line with customer expectations. Full-line department stores will still be critical anchors for large dominant regional centres. At sub-regional locations where convenience is the critical drive, smaller At Home shops are proving very successful.Akers The strategy of any particular retailer depends on how they see their store portfolio working for them and in many cases this means smaller stores. For some retailers it also means larger stores or shops in a different kind of location to those they currently have.

Q Leisure is also a major focus in this issue. As the leisure offer has

evolved in retail developments in recent years, what impact does this have on your stores in these schemes and customers’ perception of shopping centres?Collins Customers want greater choice and broad-er experiences during shopping trips – this can be complemented by leisure and catering facilities. Shops are adapting with longer trading hours and by offering a greater variety of experience for their customers.Akers Leisure is an important component in customers’ perception of a shopping centre. How customers see the shopping centre depends much more on the quality of the brand line-up in the food and beverage sector than it does on the retail brands within that scheme.

I think the mood around the UK is remarkably resilient. We’re confident our shops are in the best locations Jeremy Collins, John lewis

Strength of brand is going to be much more important for retailers in the future richard akers, land Securities

Land Securities Retail

Shopping centres Location Property Name Area sq m (sq ft) Principal Contact Phone Number

Birmingham Priory Square 26,003 (279,900) Rich Hutchinson 0141 331 4403

Bristol Cabot Circus 134,986 (1,453,000) Vasiliki Arvaniti 020 7024 5134

Cardiff StDavid’sDewiSant 130,063(1,400,000) GraemeStevenson 02070245415

Dundee OvergateCentre 39,019(420,000) KatherineArmstead 01413314409

Exeter Princesshay 49,238(530,000) SimonHaworth 02070245137

Glasgow BuchananGalleries 56,411(607,200) KatherineArmstead 01413314409

Leeds TrinityLeeds 92,902(1,000,000) KatherineArmstead 01413314409

Leeds White Rose 63,174 (680,000) Harlan Pollitt 0113 261 5351

Livingston The Centre 80,639 (867,986 ) Rich Hutchinson 0141 331 4403

London OneNewChange 20,439(220,000) DavidAtcherley-Symes 02070243730

London Shopstop,Clapham 4,170(44,884) GemmaDew 02070245133

London LewishamCentre 31,269(336,579) AndrewRawlings 02077472336

London W12,ShepherdsBush 24,155(260,000) AndrewRawlings 02077472336

London TheO2Centre 25,770(277,385) AndrewRawlings 02077472336

London Southside,Wandsworth 49,238(530,000) GemmaDew 02070245133

Oxford WestgateCentre 29,729(320,000) SimonHaworth 02070245137

Salisbury The Maltings 8,921 (96,022) Robert Hardie 020 7024 5083

Sunderland The Bridges 47,844 (515,000) Harlan Pollitt 0113 261 5351

OutletsLocation Property Name Area sq m (sq ft) Principal Contact Phone Number

Hatfield TheGalleria 29,729(320,000) RobertHardie 02070245083

Portsmouth GunwharfQuays 39,483(425,000) GemmaDew 02070245133

Retail parks Location Property Name Area sq m (sq ft) Principal Contact Phone Number

Bexhill-On-Sea RavensideRetail&LeisurePark 24,131(259,750) HermioneMackrill 02070245486

Blackpool Blackpool Retail Park 11,271 (121,323) Ian Bramley 020 7024 5484

Bracknell ThePeelCentre 15,384(165,592) NickDuffield 02070245485

ChadwellHeath GoodmayesRetailPark 9,197(99,000) IanBramley 02070245484

Chester GreyhoundRetailPark 18,859(203,000) HermioneMackrill 02070245486

Chesterfield RavensideRetailPark 12,344(132,875) IanBramley 02070245484

Crawley SussexHouse 10,999(118,388)IanBramley02070245484

Derby MeteorCentre 16,920(182,130) NickDuffield 02070245485

Dundee KingswayWestRetailPark 27,768(298,900) HermioneMackrill 02070245486

Gateshead TeamValleyRetailWorld 35,083(377,650) NickDuffield 02070245485

Livingston AlmondvaleRetail,South&West 35,285(379,800) NickDuffield 02070245485

Northampton NeneValleyRetailPark 13,657(147,000) IanBramley 02070245484

Poole PooleRetailPark 19,325(208,011) NickDuffield 02070245485

Taplow TheBishopCentre 9,429(101,500) NickDuffield 02070245485

Thanet EastKentLeisure 9,290(100,000) HermioneMackrill 02070245486

Thanet WestwoodCross 44,129(475,000) HermioneMackrill 02070245486

West Thurrock Lakeside Retail Park 35,004 (376,778) Ian Bramley 020 7024 5484

Workington Derwent,DerwentHowe 14,903(160,426) IanBramley 02070245484

Leisure centres Location Property Name Area sq m (sq ft) Principal Contact Phone Numer

Bath Kingsmead 8,361(90,000) PollyTroughton 02077472398

Manchester Printworks 32,516(350,000) JulieGarsden 07764208791

Nottingham TheCornerhouse 20,900(225,000) AndrewRussell 02077472395

Boldon BoldonLeisurePark 5,275(56,780) AndrewRussell 02077472395

London WestIndiaQuay 6,597(71,010) PollyTroughton 02077472398

London GreatNorthLeisurePark 8,542(91,945) AndrewRussell 02077472395

Wolverhampton BentleyBridgeLeisurePark 9,195(98,974) JulieGarsden 07764208791

Kent EurekaLeisurePark 9,232 (99,372) Mark Lomax 0207 747 2396

Aberdeen QueensLinksLeisurePark 11,951(128,639) MarkLomax 02077472396

Maidstone LockmeadowLeisureComplex 13,214(142,234) AndrewRussell 02077472395

Cambridge Cambridge Leisure 13,863 (149,220) Mark Lomax 020 7747 2396

Poole TowerParkLeisurePark 18,510(199,240) MarkLomax 02077472396

Norwich Riverside 19,595(210,920) MarkLomax 02077472396

Leeds CardiganFields 21,436(230,735) JulieGarsden 01614865035

Edinburgh FountainPark 21,636(232,890) AndrewRussell 02077472395

Manchester ParrsWood 21,795(234,600) JulieGarsden 07764208791

Brighton Brighton Marina 31,855 (342,884) Mark Lomax 020 7747 2396

Yorkshire XscapeYorkshire 33,650(362,205) JulieGarsden 07764208791

MiltonKeynes XscapeMiltonKeynes 39,109(420,966) AndrewRussell 02077472395

DevelopmentsLocation Property Name Area sq m (sq ft) Principal Contact Phone Number Opening

Taplow TheBishopsCentre 12,217(131,500) NickDuffield 02070245485 2014

Wandsworth Wandsworth 8,733(94,000) NeilCarron 02070245051 2014

Maidstone NewnhamCourt 20,903(225,000) ChrisWard 02070245482 2015

Glasgow BuchananQuarter 37,161(400,000) NickDavis 02070245203 2017

Oxford Westgate 74,322(800,000) BertMartin 02070245076 2017

SellyOak SellyOak 42,888(461,646) HermioneMackrill 02070245486 2017

Ealing EalingFilmworks 21,695(233,527) RiccardoMai 02070245136 2018


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Documents

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retail sector

retail developments

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democratising luxury

retail innovation foreword6

land securitiesspring

different cuisines