Monday, March 23, 2015

Decline of the out-of-town shopping centre?

They say that a trend which starts in America will eventually follow in Europe. And so it  was with out-of-town shopping centres - known as malls in America - and their current decline. The statistics for mall closures in America are still sketchy but most agree that while the percentage has not yet reached double figures, the trend is clear and accelerating. Worst hit are the oldest, the largest and those furthest from the nearest town.

Among the reasons for this decline are the growth of online shopping, particularly where the famous brands found within the malls, have themselves entered the online sector. Why drive when you can shop at home? The scarcity and consequent high costs of building land are also cited, along with climate change where heavy snow can make access difficult for several weeks of the year. Many people are also turning their back on the car and among cities voted as among the best places to live are those where it is possible to move around on foot or by bicycle - to work, to shop, to enjoy ones leisure.

France is still at the expansion stage but there are already signs that this may be slowing down or halting, partly due to recession, but also for the reasons noted above. France has been Europe's largest creator of 'centres commeriaux' which are a feature of most suburbs - and the statistics are impressive:

- estimated number of shopping centre is 750, featuring over 33 thousand indiviual shops
- the amount of land occupied has been estimated at 17 million square metres
- total annual visits by shoppers over 3.2 billion
- annual turnover estimated at 118 billion euros
- 420 000 people are employed (25% of the total retail sector) with an estimated 15 000 new jobs each year
- it takes from 5 to 7 years before a commercial centre becomes viable (before it was morely to be 3 to 5 years)

Among the reasons cited for their success are the appeal of one-stop shopping, based around a flagship brand (such as a well known hypermarket) and a concentration of all the best-known retail chains. Easy access and parking are also appreciated by users.

For the retailers the attractions include potentially lower rents compared with the town centre and being alongside their well known neighbours.

Factors which may (as in America) lead to their decline include online shopping, traffic congestion, lack of public transport for non-car drivers (bearing in mind Europe's aging population) and the overwhelming size of some centres and individual hypermarkets.

There are also concerns about the corresponding decline in town centres which are seen as dying through lack of convenient shops and services. City councils  are reacting by lowering rates and taxes, improving public transport and parking, and creating more pedestrian areas. Some retailers have reacted by opening smaller in-town outlets, including Monoprix and Carrefour.

A final heartening trend from America is the recyling of some out-of-town malls, including schools, universities,  hospitals and medical centres, and sports and leisure complexes.