As legacy retailers continue closing stores and mall and mixed-use developers face the prospect — and reality — of vacant store spaces, specialty leasing and business development teams are becoming more important. The millennial consumer, who can buy almost anything online, needs a good reason to visit a property. Malls and shopping centers that will thrive in this climate will deliver exceptional ancillary retail experiences and come up with new reasons to attract visitors.
“Ancillary” can mean pop-up stores, sponsorships, events or any other revenue sources outside of traditional long-term leasing. Ancillary retail can also include any programming that increases foot traffic or retains visitors at properties.
But pop-ups are the clear superstars of ancillary retail today. During a town hall session at France Media’s Ancillary Retail Expo, where attendees could ask questions to a panel of developers and retailers, moderator Joe Purifico, general counsel and principal for JBC & Associates, noted how important pop-ups have become.
“The pop-up store industry has grown from virtually nothing 30 years ago to approximately $25 billion a year in terms of retail sales and rental revenue to mall developers,” said Purifico. “Ten percent of developers’ revenue comes from the pop-up industry. We are no longer the little sister of the industry — we are here.”
The Ancillary Retail Expo is the only conference dedicated to helping retail property owners increase revenue through nontraditional sources. The two-day conference ran from Monday, Feb. 3 through Tuesday, Feb. 4 at the New Orleans Marriott in the French Quarter. In addition to a bustling exhibit hall and multiple networking events and opportunities, educational sessions covered trends in automated retail, sponsorships, out-of-home media, digital brand incubation, sourcing the right pop-up for the right property and more.
The ancillary retail sector is becoming more sophisticated and evolving rapidly past the carts and kiosks of yesteryear that were virtual afterthoughts during the heyday of the shopping mall. Ancillary retail is a direct answer to many questions about the health of the retail real estate industry today.
Malls are welcoming established retailers who want to test new concepts through short-term stores. But most of the time, landlords are finding themselves leasing turnkey spaces to up-and-coming, online-only merchants and helping them realize success and brand exposure through brick and mortar. For many, brand incubation is a key to survival.
Commercial real estate giant Unibail-Rodamco-Westfield (URW) is a big believer in digital incubation. The company presented during a session devoted to the retail owner’s several pop-up success stories from the recent past, including the Holiday Market and Verishop. Amy Alyeshmerni, vice president of asset strategy and innovation, and Matt Diaz, vice president of specialty leasing, also previewed an upcoming pop-up program called “The Capsule Collection,” a new network of pop-up spaces launching later this year.
REBusinessOnline will release more information on next year’s event in coming weeks. Click here to receive the latest updates on the 2021 Ancillary Retail Expo.
By: Shopping Center Business
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