Development of regional shopping centres in business

Development of regional shopping centres in business

1. The development
of regional
shopping centres

2. The American origins…
Regional centres form the
top level of a vast structure
of planned centres are
located almost entirely in
suburban and peri-urban
areas and accessible to
major road networks (12
regional centres were built
in Metropolitan Atlanta
between 1995 and 1983)

Guy (1994)

3. The American Background
•In most of the states, there are no
systematic land use planning
restrictions on retail development. In
deciding whether to build a new
regional centre, the developer does not
need consider the economic impact on
town and city centres
•The developer would consider
population, ease of access by road to
the site, attracting customers away
from existing centres
•The key to success lies in attracting
variety and mainly department stores
into the new scheme and consumer
demand
•Consider the importance of transport
networks
•Consider land prices and development
costs in the US?
Guy (1994)

4. Alternatively…Western Europe
•Out of town regional centres
first appeared in Germany,
Sweden and France in
1960s
•Such centres were built
around major conurbations
up to mid-1970s, when
hypermarkets and
superstores were also built.
•Why do you think regional
centres developed in Europe
before the UK?
Guy (1994)

5. In Britain
•In the early 1960s, pressure for
regional centres emerged due
to the projected impact on
existing town centres
•During the 1970s, very few
serious proposals for regional
shopping were made as central
and local government were
unlikely to approve
•The only regional centre built in
Britain in the 1970s was Brent
Cross, in suburban north-west
London, as its impact on other
centres would be widespread
over a large area

6. Brent Cross
•Brent Cross is seen as the
first out-of-town regional
shopping mall to be built in
Britain, and it has been
enormously successful
commercially, and retailers
face with some of the
highest rents payable in
Britain (Hillier Parker, 1993)
•What lessons do you think
developers learned from
Brent Cross?

7. In Britain
•European developments caused
considerable concern and
restrictive legislation was put into
effect in France, Belgium, the
Netherlands and Germany
(Dawson, 1982)
•Development of regional centres
has proceeded more slowly since
then due to a combination of
restrictive legislation, high land
values and local market saturation
(Healey & Baker, 1988)
•Think about mass expansion in the
1980s inflating land prices and the
potential impact of too much retail
space. What are the issues?

8. The 1980s: the boom
•In the early 1980s, a
number of regional
centres had been built
outside established
shopping locations in
Britain, and a small
number of regional-
sized centres had been
built within existing
central areas.
•Why Gateshead?

9. The 1980s: the boom
•The focus was still the
superstore and the
retail warehouse
•No centre had been
built in what would
potentially threaten
major existing town or
city centres.
•Why in late 1980s was
this the case?

10. •In the mid-1980s, most of proposals for new regional
shopping centres threatened established major town
centres.
•Fifty proposals of 500,000 sq. ft. or above were made
between 1982 and 1991
•Two main factors were influential at this stage:
–Demand for premises by comparison goods
multiples, particularly the growth and diversification of
multiples in clothing, footwear, leisure, electronic and
luxury goods
–An apparent change in attitude (Policy) by central
government to the encouragement in land use
planning issues
•Why was there a change in demand?
•Why might government have changed their attitude
towards the bigger developments?

11. •Most of regional centres were developed by local
businessmen who saw an opportunity to develop
on derelict industrial land in mid-1980s
•By the end of the 1980s, the major financial and
development interests realised the opportunities
in regional shopping centres
–The first centre developed by a major property
company was the Lakeside Centre at Thurrock
in Essex in 1990 by Capital & Counties plc, a
firm that had already developed several major
shopping malls in town centres
•What expertise do these property development
companies have?

12. Lakeside
•The regional centres
normally encompass a
shopping centre, with
variety and department
stores as major users,
and comparison shops
run by multiple retailers
forming the majority of
the smaller units
•NB Architectural
statements?

13. The 1990s and onwards
‘Regional planning guidance should set up
the development strategy for each region,
indicating the role that the network of town
centres should play and proposing a broad
strategy for its development, including
scope, if any, for additional regional
shopping centres’New or amended policies 1996
(Guy, 2007)
Why did we need regional strategies?

14. •Some out-of-centre large-scale malls such as
Bluewater (Kent) and the Trafford Centre (Greater
Manchester) were opened during the late 1990s,
but all of them had received an outline planning
consent before 1993
•The construction was delayed until the mid-1990s
due to the poor demand from fashion retailers and
department stores and the financial difficulties
faced by developers in the economic recession.
•In what ways do flagship property developments
assist regional economies.
• List any 10 examples?

16. But…
•Expansion of the existing regional centres e.g. at
Merry Hill was refused, because it was not a town or
district centre
•Further out-of-centre regional centres would not
normally be permitted, and few proposals were made
in the 2000’s
•The only addition to the set of regional-scale centres
in out-of-centre locations which were permitted during
the 1990s was at White City in west London.
–It included 135,000 sq.m of retailing.
–It was not positively supported by the Secretary of State for
its determination
–Although technically out-of-centre, it is within the built-up
area of inner London.
–The scheme suffered many delays, in 2006, it was planned
to open in 2008 at the cost of £1.6bn

17. •Another such scheme was also in London –
the Stratford City development, with up to
155,500 sq. m. of retailing.
• In 2006, it was planned to open in 2009. It
received planning consent from its local
council and the Greater London Authority

•This scheme is linked with transport
improvements and London’s bid for the 2012
Olympic Games

18. Regional Shopping Centres in London

19. The two Westfields

20. Questions for Discussion
(20 minutes prep.)
1.Why would customers patronise Westfield over Central London
destinations?
2.What is the USP of each Westfield site?
3.How do they differentiate themselves in terms of Layout?
4.What are the long term prospects for the direct and indirect competition in
London?
5.What are the long term prospects for the direct and indirect competition
outside London?
6.Which Westfield has the best short and medium term prospects?
7.What are the strengths and weaknesses of the Westfield Brand?
8.What further opportunities are there for regional shopping centre
development in the South East of the UK?

21. Glow Bluewater

22. References
•Guy, C.M. (1994) The Retail Development Process.
Location, property and planning, London, Routledge.
•Guy, C. (2007), Planning for Retail Development – A
critical view of the British experience, Routledge.
•Dawson, J. A. (1982), Commercial Distribution in
Europe, London: Croom Helm.
•Healey & Baker (1988), French Shopping Centres: A
Decade of Performanc, Lonodn: Healey & Baker.
•Hillier Parker and Price Waterhouse (1993), Brent Cross
and Metrocentre: Reviewing Rent Reviews by Audi,
London: the authors.