INDUSTRY NEWS
GETTING THE RETAIL MIX RIGHT IN
MIXED-USE
DEVELOPMENTS
Gone are the days when developers took a shot in the dark choosing retail
tenants, with some white elephants that followed.
T
he retail component of a mixed-use space is optimised today
with the help of consultants and technology, underpinned
by solid developer experience, greatly improving and
securing returns on investment.
This is especially important for mixed-use developments, because, as
Nicholas Stopforth, MD of the Amdec Group (developers of Melrose Arch,
Harbour Arch and the Yacht Club), observes, ‘new urban developments
(mixed use) have a hugely positive impact on the economy, driving job
creation in the construction, hospitality and retail sectors.’
In the case of Amdec’s planned R10 billion Harbour Arch, for example, it
is set to change the entire Cape Town skyline, much like Darling Harbour
did for Sydney and Canary Wharf for London. So the retail mix here
needs to be painstakingly composed, making the most of this premium
location.
LOCATION IS KEY
Each mixed-use development is specific to its location. A mixed-use
development in a CBD is very different to one in a suburban area, with
different needs and markets.
Established mixed-use developers, from the outset, familiarise
themselves with the relevant municipal spatial development
framework (SDF) outlining the city’s development nodes.
These nodes are in keeping with government’s strategy for urban
growth to be compacted, in other words, promoting higher-
density, mixed-use development in well-located parts of our
cities, rather than spreading out.
The retail component depends on how far the development is
from other shopping centres and amenities like schools and
hospitals. ‘Mixed-use developments on the urban edge have
to consider providing these amenities if they’re not close
by,’ says Nicolas Kyriacos from Investec Property.
A good example is Steyn City near Midrand, which is close
to Mall of Africa. As such, the retail mix in its planned
5,000 square metre ‘city centre’ will come down to
the essentials expected in a high-end residential
environment, such as a small grocery outlet, deli,
pharmacy and coffee shop. ‘There will be a clinic,
but not a hospital, as there are private hospitals in
26
the vicinity,’ says Guiseppi Plumari, CEO of Steyn City Properties.
Also, in developments that are further from the city, thought has to
be given to nightlife. ‘The shops and services you have must also
support an exciting nightlife, so residents aren’t forced to leave in
search of entertainment,’ says Brett Petzer, founder and COO of
The Green Housing Company.
SUSTAINABLE RETAILERS
Once the development is complete, a leasing development team
steps in to determine the best mix of retailers to be installed in
the gross leasable area (GLA), as well as the best positions for the
different businesses.