DESIGNING LARGE RETAIL AND COMMERCIAL CENTRES

on 04/05/2020 at 5:30 pm

Retail and Commercial Centres development. What should you focus on when designing large retail centers? Successful modern retail centers are rarely developed without thorough planning, good design, and rigorous economic study behind them. It is a standard professional practice in Australia to analyze all aspects of development prior to designing the subject site.

LARGE RETAIL CENTRES

Prior to embarking on the preparation of architectural projects for the development, Urban Design and Economic Due Diligence should be performed to establish the most profitable outcomes for the local area.

Many shopping centers throughout Asia that failed to deliver expected client visitation numbers and profitability targets lacked thorough research in the Due Diligence stage. The widespread success of Australian retail development projects demonstrates the value of rigorous Due Diligence and thorough Urban Design processes.

Our urban design approach draws from 20 years’ experience in assessing and strategizing potential development sites while creating the best economic and developmental fit for the area.

As a result of this industry experience, we created “Bulky goods design guidelines” that have been adopted by the Victorian Government. The Victorian Department of Planning and Community Development uses these Guidelines to advise investors, designers, planners, Local Governments, and future developers on effective urban design for large format retail premises throughout Victoria.

Urban design principals when designing large retail centers

Some principals that we apply when studying the locality are:

Retail development principles

Recognizing the focal point in demand for a specific retail character.
Ratio and balance of all participating retailers.
Connection with its immediate surroundings.
Balance of visible parking and provision of as many transport modes as applicable.
Customize all walkable distances within the local neighborhood.
Inclusion of best practice examples.
Ensuring overall well located and well-designed retail premises.

Ancillary Urban Design principles in designing retail centers

Create public spaces incorporating civic and economic values
Inclusion of its immediate surrounding and interfaces
Ensure public spaces are comfortable and engaging for all users.
Enhance the contribution to public spaces that surrounding buildings make, by encouraging thoughtful, context-sensitive architectural design in new retail premises.
Improve pedestrian and cycling amenity, and encourage an increase in pedestrian and cycling traffic by maximizing the convenience, safety, and appeal of these modes of travel.
Better integrate public transport with retail precincts by increasing public accessibility, safety, and comfort.
Improve safety and promote the natural amenity of public space and street activity. This can be achieved by ensuring buildings address streets and other public spaces, and contain active uses on the ground floor.

Encourage environmental sustainability in the process of designing large retail centers

Use the opportunity of project scale to apply best practice examples and promote new inventions.
Promote the efficient re-use of existing assets, prolong the life cycle of structures, ensure energy efficiency, water, and resource conservation, and encourage appropriate use of materials.
Ensure site location is consistent with or implements any objective, policy, strategy, or plan for the area set out in the planning scheme.
Prepare a site analysis that documents the area’s character and identifies opportunities and constraints of the site. Use the report to generate and test options as part of the design process.
Consider how the development will integrate with, and impact upon existing and future uses nearby.

Property Advisory & Due Diligence

The role of an economist in designing successful retail centers is to provide measurable parameters of economic drivers in the interest of the client and successful project development.

An economic Due Diligence review will support a project’s economic feasibility in the context of a broader market. By examining business risk, market research, retail supply, and customer demand our experts can assess a project’s economic feasibility and financial risk, helping the client to make strategic decisions based on professional, impartial assessment.

Our property economist experts will carry out an economic Due Diligence review by:

Assessing the demographic and population profile within the retail catchment
Evaluating estimated costs, budgets, and financial models
Examining the ‘gap’ between current and forecast levels of supply and demand for retail property
Assessing risk and offer mitigation solutions
Reviewing local market research
Providing assurance of the business case
Running sensitivity analyses on investment scenarios

Benefits of Economic Due Diligence for Retail Developments

Rigorous economic due diligence and market feasibility provide significant value for retail development projects, in the form of quantifying the specific monetary value of the investment opportunity for retail development, within a given catchment. This reduces the risk for the investment decision and provides clarity for the future viability of the development.

Property Advisory & Due Diligence

Case Study: Latrobe City Council, Bulky Goods Retail Sustainability Assessment

This is a proven methodology, as used in the Latrobe Bulky Good Retail Sustainability Assessment and Site Selection Report. Latrobe City Council commissioned a study to undertake a bulky goods retail needs assessment within Moe, Morwell, and Traralgon. This assessment included the identification of appropriate sites for bulky goods retail development within Latrobe City Council.

Benefits of rigorous economic Due Diligence in designing large retail centres:

The development responds to market demand:

Capitalize on the market opportunity
Capture market share
Sales revenue maximized
Profits are maximized

Informed investment decision making:

Develop the project with confidence
Informed planning outcomes
Strategic timing and staging of development to match market conditions
Match retail tenant to socio-demographic
Characteristics

Mitigate risks of under-performing centers:

Sustainable commercial performance
Maximize shopping center performance

Risks of failure to engage rigorous economic Due Diligence in designing large retail centres:

Excess demand for shopping centers leads to:

Failure to capitalize on the market opportunity
Competitor centers increase market share
Lost opportunity for sales revenue
Lost opportunity for profit

Excess supply of shopping centers leads to:

High retail vacancy rates
Tangible financial losses, including
Lost lease and rental income
Ongoing service & maintenance fees
Sewerage, plumbing & drainage issues
Property neglect & damage

Financial viability jeopardized:

under-performing shopping center
potential shopping center failure.