What was the average size of the Welsh backline in the Six Nations? According to various estimates, somewhere between the size of my shed and my house. My initial reaction was that I’m glad my playing days are long gone. But it also seems to be indicative of a wider trend, towards size, power, scale in everything.
In retail property, the trend is undeniable. We term it ‘black hole retailing,’ whereby prime, dominant centres suck in so much of the spending in their regional catchments, that they leave increasingly little for former prime, secondary and tertiary locations. To illustrate, Westfield announced recently that it’s two London flagship malls will sell an astonishing £2bn worth of merchandise this year. Westfield also announced that it is selling three of its minor UK shopping centres to free up cash to fund a share buyback and to ‘expand its global reach in primary markets.’
Across Europe, major players are selling either non-core or secondary stock to focus on their existing larger centres, or to buy new absolute prime stock or to fund their prime development pipeline. Notably;
- Unibail-Rodamco is selling some of its smaller centres in a bid to focus on its larger centres
- Klépierre plans to sell €1 billion of assets by the end of 2013 to finance its prime development programme (no doubt a factor in Simon Property Group’s recent weighty investment in Klepierre)
- Corio is selling €670 million worth of properties to help finance a €2.5 billion pipeline of shopping-centre projects
- Hammerson is selling its office stock to concentrate on its major retail assets
- British Land will invest primarily in locally dominant retail assets amid increased polarisation between prime and secondary in the sector.
What this confirms is that the major developers, investors and retailers alike appear to be backing the ‘size is everything’ mantra. We explore this, and other hot topics, in more detail in our Retail 2020 series. It’s gratifying to see that the Welsh rugby team, for one, have taken the message onboard!