Food and drink could save retail

Westfield Stratford shopping centre officially opens on September 13 in what is just as tough an environment as when its sister site Westfield London opened its doors in 2008.

We’re almost there with another shopping mecca.

But what Westfield has sussed-out better than most landlords is the benefit of leisure tenants. That’s why it has one of the highest percentages of food and drink outlets in its centres and why it is performing relatively strongly compared with the rest of the retail sector – chiefly the high streets.

This has been taken up by other mall operators and Capital Shopping Centres (CSC) recently indicated that ‘Catering’ (cafes and restaurants) now accounts for 8% of the group’s total rent roll – which hits 10% at its larger Gateshead Metrocentre and Lakeside venues.

Indicative of Westfield’s desire for leisure tenants is the planned opening of the first brewpub in a UK shopping centre, Tap East, which will be run by the same operators as The Rake bar in Borough Market.

And it will be joined by the second mall pub from Geronimo Inns (now owned by Young’s) called The Cow. This follows the success of the first Geronimo, in Westfield London, The Bull. The pub sits alongside a big array of food and drink operators who are arguably clamouring to get into shopping centres.

Small but perfectly formed.

This is partly because of the heavy footfall that goes through the larger, more successful, centres but also because of the difficulty restaurant operators are having securing prime sites in city centres.

Perversely, while vacancy rates on high streets rise, the leading restaurant chains are battling to find suitable units. This is because of the shortage of decent A3 units (that have planning permission for restaurant usage) while there is a raft of A1 (limited to retail usage) available. Gaining permission to transfer properties from one to the other is not considered an option.

Moving from A1 to A3 is tough. 

The shopping centres therefore offer an attractive alternative to the food operators. So while the high street withers – but hopefully doesn’t slowly die – the malls are bucking the broad trends of declining retail sales and attracting shoppers to their locations through an appealing array of food and drink options.

The final words go to Simon Kossoff, chief executive of Carluccio’s, who when speaking at the Allegra Restaurant Leader Summit earlier in the year, suggested the inability to find sites was “such a nonsense when the internet is murdering the retail industry and the high street is dying”.