Advice and Opinion

Shopping centres: to refurbish or not to refurbish?

Shopping Centre Generic

When would shopping centres need to consider refurbishments? Shopping centres should think about keeping up with the current shopping trends, retail formats which erode traffic or simply; a strategic need to expand or to improve certain aspects of the shopping centre, for the consumer’s convenience.  

Reilly’s ‘Law’ or Commercial Gravity (as its known) is another reason to consider. According to this ‘law’, customers are willing to travel long distances to larger retail centres according to the higher attraction presented to them.

William J Reilly developed this law in 1931 whereby it states that the attractiveness of the retail centre becomes the analogy for size (mass) in the physical law of gravity. The law presumes that the geography of the area is flat, without any rivers, roads or mountains to alter a consumer’s decision of where to travel to purchase goods. In analogy with Newton’s Law of Gravitation, the point of indifference is the point at which the ‘attractiveness’ of the two retail centres.

Moses Mushirivindi, an authority on mall refurbishments agrees with all the above-mentioned reasons:

It was established that the timing of a revamp or refurbishment is dependent on the performance of the shopping centre which is mainly deduced from; property net income trends, tenant turnover trends, foot traffic trends, vacancies and time it takes to fill up vacancies. This will lead to a determination of the life cycle stage of the centre. The research established that management must plan a refurbishment at the maturity stage of the centre’s life cycle. This is when there is a large number of shopping centres of the same type coupled with sharp competition and declining sales growth. It is important to therefore understand the stage of the life cycle stage in order to plan refurbishment.”

Mushirivindi added that the motive for the refurbishment must be established which would unveil which aspect of the centre needs to be refurbished first: “refurbishment can be undertaken to cure physical obsolescence, functional obsolescence and the order of works which is dependent on the aspects requiring the refurbishment”.

Mushirivindi will be speaking at the upcoming SACSC Research Conference in May.

He was born in Zimbabwe where he obtained his B.Com Honours Degree in Management and a Graduate Diploma in Marketing. In 2015 he was awarded the MidCity Properties award for best student in Property Management. Upon arriving in South Africa, he enrolled for an MSc in Real Estate degree with University of Pretoria which he completed in 2016 and Graduated in 2017. He got a distinction in his research which was entitled “Optimum Refurbishment Time for Shopping Centres”, under the tutelage of Dr Dirk Prinsloo and Professor Chris Cloete.

Commenting on Mushirivindi’s research, University of Pretoria’s Professor Chris Cloete who is also the SACSC Chairman of Shopping Centre Studies, said that there has been a number of MSc mini-dissertations on shopping centre topics that had been completed over the past two years.:

The founding of the Shopping Centre Studies at the University of Pretoria in 2017 was a milestone in university education and research in South Africa. It served as a stimulus for many research projects by post-graduate students. The characteristics of shopping centres as complex systems, and the divergent and important role it fulfils in modern society, are being investigated in a wide range of research topics in the Department of Construction Economics. A number of research papers have also emanated from post-graduate research on shopping centres. These outputs contribute to the increasing recognition of the SACSC/University of Pretoria initiative as the major focus of shopping centre research in South Africa and indeed in Africa,” he said.

Chief Executive Officer for the SACSC, Amanda Stops, said that Moses Mushirivindi is just one of the many speakers at the 2018 SACSC Research Conference who will bring many important retail and shopping centre insights to light.

“We look forward to showcasing Moses, along with our other speakers to delegates next month, it is going to be an enlightening session for all,” she concluded.