How to increase the rental rate in a shopping center through modernization and redesign

17.02.2021

The UNK group of companies' experts identified several ways of modernization and redesign that will encourage return visitors and tenants to the shopping center and, as a result, increase the rental rate.
The 2020 results were extremely painful for shopping centers. According to JLL published data, vacancy increased by 5.4%, owing primarily to tenants leaving shopping centers with an outdated concept.
Local redevelopment and redesign can change the situation and bring tenants back without a radical redevelopment of shopping centers. "The "old" shopping centers have flaws in the way the internal space is organized. This leads to a decrease in traffic and, as a result, a drop in revenue and the departure of tenants," says Julia Tryaskina, Partner of UNK Group. Among the most common are "shallow" cut spaces, difficult navigation, and outdated and thus unappealing design. Most importantly, however, there are no "vertical" ties.
The specialist suggests several ways to increase the profitability of existing shopping centers avoiding major restructuring.

Redevelopment of the internal space
Narrow, poorly lit corridors and a "chaotic" mix of small shops are all signs of an out-of-date shopping center. It is, therefore, worthwhile to redesign the interior space, enlarge the rented space, and widen the corridors. This will bring in larger, more "high profile" tenants to the shopping center.

Vertical ties
Many outdated shopping centers are planned solely "horizontally": visitors stroll mainly on one level that is reached from the entrance. A building with no "vertical ties" will see lower visitor flows and less return on space on the other floors. Vertical ties within a shopping center can be formed, for example, by arranging pass-through atriums that are well seen from various points throughout the building.

Latest design
Space design takes a fashionable approach as well. An outlived design may also be a detrimental factor for a shopping center. Clear functional zones of a shopping center, up-to-date navigation, a design code for the shops, individual lighting solutions - all this will "modernize" the project and make customer visits more productive and enjoyable. As such, all this will help to increase the average time spent in the shopping centers, which will also have a positive impact on the commercial success of the project.

Modernization of entrances
Modern shopping centers usually have spacious, well-decorated entrances that are well seen from the street. This factor allows attracting spontaneous visitors to the shopping center.
Wide entrances and beautiful entrance groups will also help to modernize the old shopping center and add more visitors.

The recreational area around the shopping center
Even a tiny recreational area in front of the shopping center's entrance will make it a destination for the people of the neighborhood. It will also bring in additional traffic from spontaneous visitors.

New features in the shopping center
Today, shopping centers are becoming centers of neighborhood life. A shopping center can incorporate places for events, city and municipal organizations, and other purposes, in addition to retail and entertainment, attracting an additional target audience that is difficult to attract with other functions.

"All of these initiatives have the potential to greatly enhance traffic in the shopping center, resulting in a rise in tenant income and, as a result, the possibility of increasing the rental rate," says Julia Tryaskina.

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