Europe, like the rest of the world has faced an incredibly difficult few months because of the effects of the coronavirus. Like regions all around the globe, the European retail and leisure sector is adapting to a new environment and new sets of rules as retailers, leisure operators and developers continue to find new ways to cope with the pandemic as the world tries to put itself back on the right track. Here, RLI takes a look at the European market in the post-Covid-19 new normal and highlights some key developments that show the resilience of the continent.
At the start of the year, it appeared the world was excited for a new decade and the possibilities that were in store across the globe. Now, just over half a year later and the world has been thrown into turmoil because of the coronavirus pandemic. In Europe, the Covid-19 virus hit Europe in January and February, with the first cases confirmed in Spain, France and Italy. Covid-19 infections have now been diagnosed in all European Union Member States.
THE STATE OF PLAY
So much has happened in just a few short months that it is very difficult to know exactly what the future holds for the retail and leisure industry. Obviously it will still exist, but in what form remains to be seen as the effects of the virus continue to take their toll in different ways.
Not so long ago, Europe was looking to Asia as an indication of what it might expect once the area moved towards a post-Covid-19 new normal in the sector. But it must be said that outcomes in differing countries may vary a great deal because of how individual governments have dealt with the pandemic, the ensuing lockdown and of course, residents of each individual country and their feelings towards coronavirus and how safe they may feel in any given environment.
Perhaps unsurprisingly given the lockdown of stores across the world, as a whole e-commerce appears to be very stable, showing long term sales growth despite events regarding Covid-19, according to research on the first wave of Covid-19 and the state of e-commerce in CEE by Jan Lastuvka, Founder of MonkeyData and Research Author.
Covid-19 is ushering in a new age of consumer behaviour according to research which shows the vast majority of Europeans plan to stick to their lockdown online buying habits. Retailers have seen online sales increase dramatically with 64 per cent of Europeans admitting to shopping more online during Covid-19. In the UK alone, this rapid increase in e-commerce is expected to add £5.3bn to e-commerce sales in 2020, totalling £78.9bn according to the ‘Why European shopping may never be the same post-Covid-19 report by DS Smith.
According to the ‘The Phoenix Awakes: Retail & Leisure Trends in Europe’ by Yvonne Court of Cushman & Wakefield, some countries have had very strict quarantines/lockdowns such as Italy, Spain, Greece and France whilst others such as Sweden have continued to operate in pretty much the same way.
Court explains that: “The impact on the future physical retail and leisure landscape remains to be seen, but it is likely to be very different from that seen before the Covid-19 pandemic. It is still too soon to assess the impact on footfall and sales, and both will take time to get back close to pre-Covid-19 levels. Anecdotal feedback is that there are improvements week on week both in terms of footfall and turnover. In most countries, footfall appears to be showing a decrease on the same period last year, though it is slowly improving and largely depends on the type of retail and leisure destination.”
THE SHOPPING CENTRE IN THE “NEW NORMAL”
Covid-19 has fast tracked a rapidly innovating world and we have seen that traditional brick-and-mortar shops are failing and failing fast.
What this latest retail apocalypse has brought to the fore in terms of shopping centre development is the concept of transformation. For example, when Cirque du Soleil announced plans in 2018 for a “family entertainment” concept inside a Toronto mall, it said a lot about the future of shopping centres. No longer is it good enough for malls to be passive places to buy stuff – they have to be engaging places to do stuff. Otherwise, this particular retail format will be relegated to relic status – a historical anachronism, that no longer meets the public’s, the consumer’s or the retailer’s needs.
As Netscape Founder and venture capitalist Marc Andreessen memorably put it – “Online triumphs over offline”, or “software eats retail” – but it doesn’t have to be that way. Far from abandoned shopping centres and empty high streets, we’re seeing growth in an entirely new direction and in some cases, they are not being killed by online retail; instead, they are helping to build online retailers. Internationally many developers are creating “scalable retail platforms” in the form of pop-up spaces for e-commerce start-ups, who are increasingly eager to get a physical presence for their products.
Like any kind of retail, the shopping centre is not dead, but it does need to be radically reinvented. Two years ago developer Unibail-Rodamco-Westfield unveiled its “Destination 2028” vision, where shopping centres become “hyper-connected micro-cities”. AI-infused walkways, eye-scanners that personalise a consumer’s visit, and smart changing rooms will add an “extra-perience” layer for shoppers. But the real advances will come in the form of reimagined retail. Stores will be stages, delivering “classroom retail” – showcasing the makers and processes behind products and brands. Event areas will host showpiece interactive activities and events. Allotments and farms will enable shoppers to pick their own produce.
More and more, retail spaces are becoming public spaces, representing an intersection of physical and online shopping. Grabbing a coffee, checking out an exhibition or popping into your favourite online brand’s newest pop-up store will be the vision of the future shopping centre.
KEY RETAIL LOCATIONS
Retailers, department stores and leisure concepts from across Europe are finding new ways to entice customers back to their stores as they look to not only revive flagging sales but also to ensure they make their guests feel safe. After months in lockdown people are beginning to venture back out to major destinations and listed below is a just of few of the key locations across Europe that may have the space to incorporate social distancing in a perfectly safe way as they navigate the new normal.
• Galeries Lafayette, Paris, France
An upmarket French department store company, this flagship store is located on Boulevard Haussmann in the 9th arrondissement of Paris and is spread across an impressive ten-storeys and 70,000sq m. Back in 2009 it recorded earnings of over one billion euros.
• Galleria Vittorio Emanuele II, Milan, Italy
A place of transit, the Galleria is considered to be one of the sites of Milanese luxury shopping, along with Via Montenapoleone and Via della Spiga, it hosts many prestigious labels and brand shops, famous cafes and restaurants.
• Harrods, London, UK
Harrods is an upmarket department store located on Brompton Road in Knightsbridge, in the Royal Borough of Kensington and Chelsea, London. The store occupies a 20,000sq m site and has over 90,000sq m of selling space in over 330 departments making it the biggest department store in Europe.
• FOODTOPIA, MyZeil, Frankfurt, Germany
Located on the fourth floor of MyZeil, FOODTOPIA features a unique food and entertainment offer with a variety of modern premium food concepts and special architecture with an urban flair, attractive design and the vibrant atmosphere of a market hall.
• Las Arenas, Barcelona, Spain
Las Arenas is a unique shopping mall in Barcelona. Located in Plaça Espanya, opposite Fira Montjuic and the Palau Reial. Now Las Arenas is a modern, state-of-the-art complex boasting over 60 commercial outlets, including fashion stores, cafes, restaurants and bars. The complex is the modern incarnation of the historic Las Arenas bullfighting ring, many of whose original architectural details have been incorporated.
• Kanyon, Istanbul, Turkey
Kanyon (meaning Canyon in Turkish) is a multi-purpose complex located at Büyükdere Avenue No. 185 in the Levent business district of Istanbul, Turkey. Opened on 6 June 2006, it unites a 160-store shopping mall (covering an area of 37,500sq m), a 30-floor office tower (26 floors of which rise above street level) and a 22-floor residential block with 179 residential apartments into a complex undulating around a dramatic architectural “canyon”. The total construction area of the project is 250,000sq m, with 30,000sq m of rentable office area, 37,500sq m of rentable retail area, 180 residential flats, 160 stores, 9 theatre halls with a capacity of 1,600 spectators, and a parking facility for 2,300 vehicles.
• The Gazompeter, Vienna, Austria
Since the end of the 1990s, four teams of star architects have been working on converting four 102-year-old gasometers into a new urban complex. Apart from 615 modern flats and an events hall holding 4,200 people, the 22,000sq m ground floor of the gasometer complex in the Vienna district of Simmering – once a heavily industrialised area – will also have a shopping mall with some 70 shops. Just eight minutes’ away from the city centre (Stephansplatz) on the U3 underground line, this new El Dorado offers sheer shopping pleasure in any weather. The gigantic size of this construction project is illustrated by the fact that Vienna’s Giant Ferris Wheel would easily fit into each of the four 75m high gasometers.
• Magna Plaza, Amsterdam, The Netherlands
The former main post office building in Amsterdam is a wonderful building. The impressive façade between the Dam Palace and the Nieuwe Kerk has been providing a trusted view for almost a century, first as the main post office and currently as a shopping centre with international allure. Architect Cornelis Hendrik Peters built it in neo-Gothic style, a mixture of Gothic and Romantic elements of which, for instance, the Parliament buildings in London are also an example. In 1992 this beautiful building was added to the list of the ten most valuable monuments of the city of Amsterdam.
• Mediacite, Liege, Belgium
This complex opened in October 2009 includes approximately 160,000sq m of economic, cultural and leisure activities. The mall is wearing a monumental roof signed Ron Arad. Médiacité partially reinstated the old gallery Longdoz Centre, itself built on the site of the former station Longdoz (destroyed in 1975).
• The Zlote Tarasy, Warsaw, Poland
The Złote Tarasy, Golden Terraces in English is a commercial, office, and entertainment complex in the centre of Warsaw, Poland, located next to the Warszawa Centralna railway station between Jana Pawła II and Emilii Plater streets. It opened on February 7, 2007.
PROJECTS FOR THE FUTURE
Despite the last six months and the negative news it has brought the industry across Europe, positive stories are starting to emerge once again as the region begins to fight back.
In Madrid, the renovation works of Parque Corredor Shopping Center, aimed at transforming the leading shopping centre in the Torrejón de Ardoz area into one of retail centres of reference in the NE Madrid region, continues to advance at a fast pace. Parque Corredor is one of the largest shopping centres in Spain, with 123,000sq m of surface. The large-scale, €45M renovation affects the entire shopping centre and will allow a more balanced distribution of the commercial units with double height façades emphasizing the width and height of the mall. Iconic access points and a new parking are also part of the plan to fully modernise the shopping centre and the installation of large skylights create a more pleasant and natural lighting which will also help to reduce energy consumption. These works are to be completed in August, in order to improve the constant flow of the more than 11 million visitors the centre normally welcomes each year.
Therme Group has confirmed that construction is set to start next year on a £250M leisure resort that is planned in Trafford Park. Set to open in 2023, the 700,000sq ft project on Barton Dock Road will combine water-based activities with wellbeing treatments, art, nature and technology. Under the plans, Therme Manchester is to occupy the 28-acre site currently occupied by EventCity, which will relocate to the nearby Soccer Dome, while Soccer Dome’s tenant, Fives Soccer Centre, is moving to a site close to Chill Factore. The resort will contain a two-acre wellbeing garden and a large family zone with a wave pool, waterslides, indoor and outdoor pools and steam rooms. A dedicated adults’ area will feature warm-water lagoons set within a backdrop of botanical gardens, swim-up bars and therapeutic mineral baths. The tropical environment is due to include a large family area with water slides, a wave pool, indoor and outdoor pools, steam rooms, exotic palm tree, and relaxation areas.
Back in 2014, the City of Brussels selected Unibail-Rodamco-Westfield for the redevelopment of Heysel Plateau, a mixed-use project. The aptly named Mall of Europe will become a destination dedicated to leisure, food and retail along with residential and office buildings when it opens in 2024. Convinced by the need of creating a true living environment through re-urbanisation at the Heysel plateau, the city and region of Brussels designed a project aspiring for a modern neighbourhood, a model of both urbanism and sustainable development: Europea. Together, they will create a unique attraction pole in Europe, generating a commonplace and a connection; bringing to life Brussels’ new ambition. Inside this mixed-use neighbourhood, Mall of Europe will present an exceptional destination. This major and avant-garde project, born from the vision of the future of the city, was designed to offer its visitors a new kind of experience by combining shopping, discovery and sharing.