Mixed use retail: What happens next?
by Mark Faithfull
Leisure, food & beverage, office space, co-working, residential, healthcare, wellbeing and logistics are all transforming the face of mixed use retail destinations and lifestyle centres, with the latest mixed-use schemes aiming to fulfil a wide range of visitor needs and meet lifestyle requirements that, especially over the past 12 months, have focused on local neighbourhoods.
Successful development in the retail sector has always been about helping customers stay ahead of the trends but the latest mixed use retail development projects are now evolving at pace, with different uses helping offset some of the risks around the longer term trends in retail space, while combining the right mixed-use elements can create a halo effect, improving revenue right across a scheme.
Retail and mixed use development
Two of the most significant game-changers of recent years have arguably been the evolution of food and beverage (F&B) outlets, a defining factor in driving footfall in a world where many conventional transactions have shifted online, and the rise in all forms of leisure and entertainment.
Right across Europe, the US and indeed the world, F&B has become one of the most significant factors driving new schemes, and shaping the way refurbishments are executed. And if F&B was the early-mover in shopping centre transformation, leisure has arguably become the latest big thing, with multi-generational attractions.
Technology can also play a part in creating stand-out retail destinations, while mixed use developments are popular with retailers because they encourage dwell and bring people into an urban development for a variety of reasons.
The emergence of blended-living solutions, including mixed use residential and retail development, right across the real estate industry is also ensuring that the idea of combining work, living and leisure time in one location becomes the new norm. Co-working, the other huge commercial property trend, has also found its way into the world of retail. The search for other complementary elements has also renewed faith in hotel anchors for mixed used schemes, with this asset class independently proving risk averse in times of economic uncertainty.
In addition, there is growing evidence of the growth of medical centres, dentists and other health specialists as shopping centre tenants, reinforcing the daily-use trend. Diversification for commercial mixed use facilities and retail shopping centres also makes a lot of commercial sense in uncertain economic times.