As growing numbers of shoppers move online, mall owners are looking to pull in customers by including services that can't be replicated on the Web like hospital care and government offices. Malls must become more like full-service community centres to survive in the face of a growing list of failed retailers.
On the flip side of that retail revolution, the experts see big gains in warehousing as more goods are sent and returned via post. “The days of the stand-alone mall are numbered,” said David Roberts, the chief executive of architect Aedas, one of the five largest practices in the world. The company has been involved in city masterplan projects in Asia, Europe and the Middle East.
“In 20 years time you will find stores that sell books and DVDs replaced by sites that give people a reason to go the mall ... art galleries, education centers and health and spa treatments.” Florencio Beccar, fund manager of CBRE Global Investors European shopping centre fund, cited the recent purchase of a mall in Germany, saying the fact it included a large medical centre was “a big plus”.
“I once saw a clinic in a Brazilian mall where you checked in and are buzzed on a device when they are ready. In the meantime you go shopping,” he said. "With the ageing population in Europe you can see that happening more and more.” CBRE Investors, which has about 14 billion euros ($18.2 billion) of retail property under management in Europe and 5,000 tenants, also owns a mall in southern Sweden with a library and a local municipal office, he said.
Mall owners like Land Securities, Intu, Westfield and Klepierre have increased the number of restaurants and cinemas to persuade shoppers to stay longer, and offer promotions to reward frequent shoppers who can be tracked via their mobile phones.
As well as changing what's inside, mall owners will need to borrow ideas from developing markets like Dubai and China where centers are part of wider mixed-use developments where people live or include open spaces where they spend leisure time, Roberts said.
“Convenience and Internet shopping has created a breakdown in community structures and there's a gap there waiting to be filled,” he said. “There is a complete lack of vision among many shopping centre owners," said Joe Valente, a managing director at JP Morgan Asset Management, who helps manage 7 billion euros of real estate in Europe.