Asset Managers – They have the power!!

The Asset Manager must lead and Redefine Retail Places: Structural Retail change means the asset manager must innovate and enhance the future value of retail property.

The retail real estate asset manager is in the power seat and has major levers of change for the retail property under their command and control:

  1. generating new income for the shopping centre
  2. delivering great operational efficiency and effectiveness for the owner
  3. maximising the asset’s capital value

The role of an asset manager is often seen as leading and managing downwards to drive change. This might be by: bringing in new retailer formats, enhancing leisure food and beverage offers, innovating the shopping centre management, growing the overall attractiveness of the shopping centre and how long customers “dwell” in the centre – all of which are aimed at increasing the retail spend! The strength of the development of omni-channel shopping in the UK means that the battle between the physical shop and e-commerce is ongoing – can the asset manager keep up? Within the ICSC’s (International Council of Shopping Centres) specialist group, we are focusing on retail asset management as the “change enabler” for owners/occupiers of shopping centres and most importantly the retailer customer!

However, who is the boss of the retail asset manager? Who sets the objectives for the asset management business plan? After all it’s just the asset manager’s role to own those objectives and implement a business plan to achieve them … or is it? The upwards management of stakeholders is now increasingly important – and generally it’s the finance community that has control and ownership of a real estate asset. These owners of the property might include:

  1. a fund manager with specific targets to achieve in certain fund timelines and return for say pensions or investments
  2. increasingly sovereign wealth equity based investor who may have a longer term view and different rates of return
  3. a bank lending debt against the asset against an agreed shorter term business plan

The ability of a real estate asset manager to advise these different financial stakeholders on what is possible and achievable within set timelines for individual property assets is vitality important for investment performance across a real estate portfolio.

No longer can the asset manager just manage – they have to lead and advise their key stakeholders – yet another skill that is essential in a world of redefining retail places.

Robert Bonwell is CEO Retail EMEA at JLL. He is responsible for the Retail Industry Sector across 27 countries in EMEA and is Chairman of the ICSC Europe Asset Management Committee.

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  1. Mick Knowles

    Could not agree more about the importance of asset managers taking an active and innovative role in redefining the shape and structure of retailing.
    This however must be informed by real and meaningful understanding of the asset and this means less time behind a desk or on the phone and more time on the Hight Street and in the Shopping Centre.
    No football manager would miss watching their team – so where are the asset managers on a busy Saturday when their assets are in action?
    Retail is a sensitive and subtle art and we cannot let it be managed by people who have not taken the time to immerse themselves in the subject.
    Headline figures and broad trends are an insufficient basis for making serious changes – If asset managers are to manage retail they need to experience it – seeing at first hand how their retail assets perform and talking directly to shoppers. You don’t need an appointment to visit your asset on a busy day and you’ll be surprised how much you can learn.

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