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Shopping Centers Today -> July 2003
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PANELISTS: WORLD NOW LAND OF RETAIL OPPORTUNITY
BY DEBRA HAZEL
LAS VEGAS — Nowhere has retail development flourished more than in North America, but lands of opportunity are emerging in many other parts of the world too, noted experts from around the globe at a brand-new Spring Convention session about leading international projects and markets.
“[If you hesitate,] you will lose opportunities,” warned Ian Watt, the managing director of Old Mutual Properties, a development company based in Cape Town, South Africa.
At the by-invitation-only session, titled “4-Star Properties from the 4-Corners of the World,” developers from Africa, Asia, Europe and Latin America discussed the opportunities and challenges for retail development worldwide. ICSC plans to turn the session, which was held at the Las Vegas Four Seasons hotel, into an annual Spring Convention event to showcase some of the world’s leading developments.
The North American model is a good starting point for developments elsewhere in the world, the group said.
“The initial phases come from the U.S. prototype,” said Fernando Zobel de Ayala, chairman of Ayala Land, Makati City, the Philippines. “But as tastes become more sophisticated, you localize a bit more.”
Half the population of 72 million in the Philippines, for example, is 26 or younger, and these patrons use shopping centers as a meeting place, he said. Thus, centers there can devote as much as 30 percent of their space to restaurants and fast-food vendors, about twice the space that is set aside for these purposes in U.S. centers.
In Mexico, too, centers are inspired by the U.S. model and continue to evolve. Though for now the regional mall segment in Mexico is saturated, open-air centers are still being built there.
Meanwhile, South Africa’s population, half of which is under 17, is savvy about international brands, said Watt.
“They’re very demanding, very attuned to what’s going on,” Watt said. To serve them, Old Mutual has added street culture, including skateboard tracks, and retailers such as Quicksilver to its centers.
South Africa’s industry, which was established during the 1960s, is mature, so Old Mutual is now looking to Central Europe and the Middle East, which have similar demographics, for growth.
With a population of 350 million, Europe would seem tantalizing, noted John Milligan, CEO of London-based developer Retail Resorts International. But the Continent is actually two markets: New Europe, which consists of the former Eastern bloc nations and is eager for development; and Old Europe, already well developed and protective of its downtowns and its green space.
Quite risky, but potentially quite rewarding, are the world’s most populous nations, China and India, the latter having greater population than Europe and the United States put together. But some opportunities in India are still about 10 years out, Milligan said, unlike Russia, which is undergoing a retail development boom.
What is important to remember is that the shopping center isn’t exactly an American creation to begin with, observed Milligan. The format may have been invented several hundred years before the birth of Christ by Mesopotamian travelers who would offer entertainment to draw a crowd.
“Once they were finished, lo and behold, the shops were set up,” he said. “Then Jim Rouse invented the festival marketplace, and we in Europe marveled at how he invented something we had had!”
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