The Fund’s optimisation strategy
To achieve its targets, the Retail Fund aims to optimise its portfolio through targeted acquisitions, the redevelopment of core assets and the disposal of non-core retail units. Taking into account the trends in the retail market and the demographic outlook, we believe that the current competitive market requires specialised, well-positioned retail assets. Our strategy is to focus on what we believe will be the two decisive elements in the future of retail:
Experience: High street portfolio, focus on A1 locations in major shopping cities
Convenience: District shopping centres, focus on catchment areas and strong tenant mix
In addition, the key building blocks in the Fund’s strategy are:
Redevelopment: expansion/redevelopment of well-located shopping centres and retail units to meet the quality requirements of modern retail
Active asset management: maintaining high occupancy levels by developing close relationships with tenants
Focus on retail tenants less sensitive to economic cycles
Key market developments | Underlying aspects | Implications | Opportunities |
Changing demography | · Urbanisation: Urban areas are still growing and continue to attract young people with spending power | · Cities, especially those in the Randstad, ‘winner’ in changing demographics | Focus on high street retail units in A1 locations (EXPERIENCE) |
· Shrinking and ageing of the population in rural areas | · Worsened perspectives for fashion retailers outside urban areas | |
High street embrace online shopping | · Consumer demand for shopping experience when shopping for non-food items | · Physical shops add brand values as service point and experience centre | |
· Large (international) fashion brands focus on exciting flagship stores as an addition to online sales | · Large retail units in best shopping cities remain popular among retailers | |
Consumers demand convenience and value | · Persistently low inflation is expected to boost consumer spending, strong turnover development in food sector | · District shopping centres focus on food and daily goods | Focus on local/district shopping centres with strong catchment area and easy access (CONVENIENCE) |
· Accessibility and parking facilities are key in daily shopping | · Opportunities for district shopping centres as pick-up point for online shopping |
Strategic actions in 2015
Strengthened ‘Experience’ portfolio, through redevelopments in A1 locations
Strengthened ‘Convenience’ portfolio, through addition of new-build project and redevelopment of local shopping centres that meet the needs of today’s consumers
Divested non-core asset Arnhemseweg in Ede
Continued to optimise the standing portfolio through redevelopments