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16 new shopping centres in Italy by 2021

24 May, Il Sole 24 Ore

The future of retail depends on high-street and shopping centres. Besides, the consumption behaviours are more and more capable of influencing the trends and the products on offer thanks to e-commerce.

Yesterday there was the opening of the third edition of Mapic Italy along with the first edition Mapic Food & Beverage to discuss the situation of the segment. The event, organised by Reed Midem, sees the participation in Milan of 1,600 people from 35 countries, 600 of which are retailers. Among the key players of the sector, there are Westfield, Ece, Eurocommercial, Igd, Svicom, Sonae Sierra and Klepierre.

Today’s agenda will open with a roundtable organised by Cncc on the current situation and the perspectives of Italian commercial real estate.

“The picture is very positive in terms of development, with openings for 350 thousand Sq m Gla last year and just as many planned for this year”, comments Massimo Moretti, Cncc president, the main partner of Mapic Italy. According to the figures provided by Cncc regarding 2017, the sector combines decreasing sales for shopping centres with a keen interest in investing by Italian and international players. Also, there is the desire of the owners to sell in order to rotate their portfolios.

“The sharpest decreased have mainly concerned shops of medium dimensions (from 601 to 1,500 Sq m) as well as big ones (over 1,500 Sq m) – states the JLL report – Consumer electronics and clothing registered the biggest drops in values. Whereas catering and services reported good performances”. For this reason, many shopping centres have converted to food.

Nowadays, shopping centres have to comply with the modern standards. Thus many Italian shopping centres need a requalification.

Alessandro Mazzanti retaliates that shopping centres need to evolve “since they’re still an important meeting point – he says. The challenge is adapting the offer to the consumers’ needs” and using technology to “enhance the shopping experience”.

“Generally speaking, in Europe – says Pierre Marin, head of JLL Italy – shopping centres attracted 50% of the investments in retail for the first three months of 2018. Italy represented from 2008 to 2017 only 4% of the European market, but this figure is growing. In the first quarter of 2018, Italy weighted for 6.5% on the total”. What about the future? By the end of 2021, there are plans for over 1,300,000 Sp m, 33% of which are already under construction and concern 16 projects. However, there are 43 projects in the pipeline, nine of which in the south. Among the main ones, there are Westfield near Milan and Caselle Open Mall in Turin, followed by Cascina Merlata in Turin.

According to the data processed by JLL since the beginning of the year, about 780 million euro were invested in the retail sector, more than the double if compared with the same period of the previous year. The eight “out of town” transactions in the first three months of 2018 concerned single assets or deals on real estate portfolios for properties located in southern Italy (Bari, Brindisi, Taranto, Naples and Siracusa). “The retail sector registered in 2017 investments for about 2.2 billion, decreasing by 23% in comparison with last year. In the meanwhile, the number of transactions reported an increase of 3% compared with 2016”, concludes Marin.

The returns for prime shopping centres were stable, while those for secondary ones increased (by 7%  at the end of 2017 to the current 7.40%). However, the outlook for the current year is positive. By the end of the year, there will be new spaces for over 150,000 Sq m referring to 11 projects and returns are expected to settle on the values reached in the first part of the year.

“Sales don’t represent a risk for shopping centres, but they’re significantly transforming the consumers’ behaviour – comments Joachim Sandberg, head of Italy and Southern Europe Region for Cushman & Wakefield -. Therefore, shopping centres will have to adapt to this change to continue making profits. Online sales do not exclude offline sales, they’re rather complementary, and the shops that will be able to come out with sales strategies combining both channels will have a competitive advantage”.

Source: Il Sole 24 Ore

Translator: Cristina Ambrosi