The Retail Experience Reinvented Through Placemaking

In today’s times, retail consumers have been significantly adapting to purchasing goods online, causing shopping center owners to seek out ways to reinvent their properties as leisure and entertainment destinations by curating their collections of tenants to include services that cannot be provided online, according to CBRE.  To attract and retain such customers, both retailers and landlords are adopting “placemaking.” This is being completed by developing engaging and dynamic environments which can create and inspire a sense of place or community. CBRE’s latest Viewpoint Report indicated that over the past five years, businesses offering personal services, such as restaurants, salons and fitness clubs, have accounted for 9 percent of retail space leased in Florida, up from 7 percent during the prior five-year period. The report also highlighted that these transformations coincide with an increase in consumer spending on personal services nationally, both in absolute terms and as a percentage of total consumption.

 

Florida’s consumer economy has been expanding rapidly because of population growth and tourism. CBRE’s report highlighted that this trend is expected to continue and to drive development of new and creative retail space. According to the report, between 2010 and 2015, annual United States personal consumption expenditures on services increased by 21 percent, or $5.8 trillion, to $33.2 trillion. The growth in services spending represents a huge opportunity for Florida landlords and retailers as Floridians are expected to spend nearly 14 percent of their consumption expenditures on food and entertainment in 2016, nearly twice the national rate, noted CBRE. The report also notes that in 2016, Floridians are projected to spend nearly 14 percent of their consumption expenditures on the category, nearly twice the rate nationally.

 

Placemaking has been embraced in such environments by being able to offer the customer in person experiences that they can only benefit from by visiting. The report indicates that Enhancing dining or shopping experiences with new technology is a critical component. It also reveals that developing convenience and multiple levels of engagement through smartphone applications help retailers attract customers, particularly Millennials. According to CBRE’s report, Florida is keeping up with the trend nationally. Projects such as One Daytona, the Aventura Mall, and the Sawgrass Mills outlet mall are property renovations that are setting the pace at shopping centers across Florida which enhances the customer experience.

 

According to CBRE, Florida had received more than 106 million visitors in 2015 and a record-breaking 29.8 million tourists in the first quarter of 2016. The state is home to the third-largest workforce in the country, having seen 71 consecutive months of job growth with a June employment increase of 3.0 percent year-over-year. CBRE’s Viewpoint report also indicates that unemployment for the state stood at 4.7 percent,, a 60 bps improvement year-over-year and 20 bps ahead of the national rate. Florida’s real gross domestic product increased 3.4 percent between Q4 2014 and Q4 2015, putting the state in a tie with Utah for third place (behind California and Oregon) and well ahead of the national growth rate of 2 percent noted CBRE.

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Jennifer Lynn

Jennifer Lynn

Jennifer is a business journalist and has over 15+ years of professional experience working in technology, financial, hospitality, real estate, healthcare, manufacturing, not for profit and retail sectors. Specializations in the field of analytics, management consulting serving global clients from medium & large scale organizations. She is a proficient and passionate business executive; manager utilizing analytics data to drive smart business decisions. Technology, Finance, Investments, Retail, Management, Consulting, Strategy. Have published on Forbes.com, Investing.com, and many others. Currently the Commercial Real Estate Contributor for Retail Solutions Advisors.