Retail property has made a strong positive contribution to South Africa’s growth in recent years, with numerous new shopping malls coming to market – each ploughing investment in the economy, creating jobs and crafting retail assets and social hubs for their communities.
Gavin Tagg of Retail Network Services, has helped deliver many successful shopping centre developments and believes, despite weaker economic fundamentals, there are still exciting new opportunities for shopping centres in 2015.
Tagg’s prognosis for retail property in 2015 highlights five dominant trends:
A cautious approach is needed by retailers and retail developers in the year ahead, advises Tagg. “It’s essential to have sound retail development basics in place to ensure the success of a new shopping centre in this flat-growth, rising-interest economy,” he notes.
With high stakes, a proven track record of delivery is essential and new retail schemes should be left to experienced developers. “This market is unforgiving,” cautions Tagg, who notes there are inexperienced retail developers who are muddying the waters right now. “It is essential to astutely assess every detail of a potential project: site assessment, rental levels, tenant mix, aesthetics, finishes and more. This requires insight that can only be gained from experience.”
- Rural shopping centres
There are still huge opportunities in the area of rural retail in South Africa and Tagg is bullish about this sector of the market. Even in these areas, outside of South Africa’s major metropolitan nodes, developing the right product is essential for success. “A rural retail development must be aspirational yet affordable,” advises Tagg. “It should also have all the fundamentals in place to, in theory, stand up to the same tests which would apply to a mall in an urban environment. You can’t cut corners for rural shopping centre development.”
- Better retail
With a slew of international retailers entering the South African market, our local consumers will continue to reap the ultimate benefit. Tagg believes that international retailers operating in and entering South Africa are improving the local retail offering considerably. This puts pressure on local retailers to be more competitive. The new wave of retail competition is improving choice, pricing and the overall retail experience for shoppers throughout the count and is set to continue during 2015.
- Listening to consumers
There’s a renewed focus on customers and “what does the consumer want?” will become an ever more important consideration in planning retail centres. “There’s no room for developers’ egos to dictate what they would like the consumer to want or for architects to lead developments,” says Tagg.
Among Retail Network Services’ current projects, it has successfully completed the leasing of Tugela Ferry Shopping Centre. Located rural district in KwaZulu-Natal, this 14,723sqm shopping centre is an excellent answer to the question “what does this shopper market want?” Shoppers in the area are badly in need of retail facilities and are underserviced in all areas, with the most basic retail needs not provided for in this small, but strategically important, town. It is Tugela Ferry’s first shopping mall and will open in April 2015.
With investment from Copper Zone (Pty) Ltd and the retail leasing know-how of Retail Network Services, Tugela Ferry residents will no longer have to travel substantial distances, at a considerable cost, to do most of their shopping and banking. Tugela Ferry is located 45km north of Greytown, 77km south of Dundee and 105km east of Ladysmith. All are a very long way to travel to access meaningful formal retail.
Besides providing much-needed shopping, banking and services to the community, Tugela Ferry Mall is also strengthening the town’s central role in the area. The lively Tugela Ferry is a major town in the heart of the Msinga District of the Umzinyathi District Municipality. It is on the Tugela River’s northern bank and is a seat of the Tribal Authority Government for the area. Making shopping easy, Tugela Ferry is on the main route which goes right through town.
Retail Network Services is a full-service specialist retail leasing company with an excellent record of successes to its name, and Tugela Ferry Mall is poised to join its impressive lineup. “Tugela Ferry Mall will go beyond bringing great, well-suited everyday shopping to local customers, it gives shoppers what they want and meets important social and economic needs for its consumers,” says Tagg.