Arrival of the fittest

‘Lifestyle’ is one of the most misused words in the retail industry. It has been adopted at various times by fashion brands that failed to represent any real discernible lifestyle at all. Resource-15a J

It was also used to describe a particular kind of upscale shopping centre in the US, invented in the mid-1980s as an antidote for monied professionals who tired of going to traditional enclosed malls that had been hijacked by teenagers.

The first 100 or so lifestyle centres were open air, pedestrian friendly, design rich, green, unanchored, had no teen fashion, and were dominated by upscale casual dining chains. They may not have represented a lifestyle exactly, but at least they were designed with some distinct likes and dislikes in mind.

But in the end the developers couldn’t resist reverting to the mean. They started letting the teen brands back in, the end result being some beautiful open- ir centres with tenant rosters that looked for all the world like that of a standard regional shopping centre.

The word ‘lifestyle’ no longer belonged in the lifestyle centre. Now the term has had a chance to redeem itself with the emergence of a new kind of shopping centre, or shopping strip, that reflects a truly aspirational lifestyle. The aspirational lifestyle I speak of is health and wellbeing.

It is driven by two factors of which we are all aware, and which straddle the entire western world.

The first is the desire of Gen Xers and baby boomers to stay forever young. The second is a growing health consciousness percolating through society at large, fed by new and exciting products, services, and retail concepts. As many trends do, the health and wellness craze began in the US.

Coincidentally, this is also where shopping centres have been under most pressure to evolve because of past excesses.

To put it in the simplest terms – the US has too much obsolete retail space and landlords need to get really creative about how to transform this space into something productive. One way of achieving this goal that shows a great deal of promise is to cater to the health and wellness craze.

We may be witnessing the arrival of the next generation of lifestyle centres, and one that is genuinely worthy of the name. The possibilities for tenanting this kind of centre are currently undergoing an explosion.

Take fitness centres for example. Once we just had massive gyms with equipment of all kinds that people could work out on in a controlled environment. They are still popular. But some creative person took the humble exercise bike and created ‘spin’ studios, where people work out in classes on stationary bikes with low lighting, loud music, and digital technology that allows them to compete against their classmates.

Overhead installations allow them to get an upper body workout at the same time as they pedal like the blazes. From generic spin classes we’ve now gone to aquaspinning and spinning/yoga hybrids. It’s a process of constant fragmentation and specialisation.

That’s not all you can do with a health club. They are also being upscaled with additional services that command premium membership prices. Lounges, restaurants, sundecks and spa services are all part of the mix. But obviously a fitness club does not an entire shopping centre make.

You can add in an organic or other high end supermarket, health food specialty stores (e.g. frozen yoghurt, vitamins), technical apparel stores (think lululemon, Nike, Lorna Jane, Running Bare), health food restaurants, farmers market, sporting goods store, spa salons, and medical services.

There is not much of a need for garden variety fashion or home furnishings, the type of tenants that fill up space in neighbourhood centres but don’t really add any vitality to the centre other than making it look 100 per cent leased. Instead, you end up with a shopping centre or strip that serves one of the most significant lifestyle trends we are likely to see in a generation.

An interesting aspect of this kind of project is that it has so far not been something typically created from the ground up.

Rather, existing projects are being gradually transformed into health and wellness centres through the releasing process. This process is exemplified by Suburban Square, an iconic lifestyle centre in Philadelphia, and other small/medium sized shopping centres around the US that have run their course as fashion centres.

In Australia, perhaps it is the beleaguered main streets across the country that could do well to take a look at this kind of setup. It will not work everywhere, but given the mass exodus of fashion stores from suburban strips, there is a gaping hole left that cannot be filled adequately by independent retailers selling convenience goods. Lowering rents and trying to lure the fashion names back will not work, so there has to be a new approach.

Health and wellness is one idea that needs to be explored if a unified strategy can be taken to lease space. On the shopping centre side a health and wellness approach could be implemented at smaller second-tier centres facing a rickety future as a result of declining domestic fashion, home furnishings and consumer electronics chains.

The shopping centre industry globally is in the process of trying to transform itself into the ‘third place’, the place that is the go-to choice for people when they are not at home and not at work. This place is top of mind when people want to connect, experience, and buy.

Not every shopping centre can succeed in making this transition and still be a one-stop shop for merchandise and services. A health and wellness focus could be an option for some.

* Michael Baker is principal of Baker Consulting and can be reached at [email protected] and www.mbaker-retail.com.

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