Shopping Centers Today

APR 2017

Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)

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38 S C T / A P R I L 2 0 1 7 existing definitions, ICSC researchers concede, though they cite compelling reasons to pursue a common language when discussing retail assets. "At a fundamental level, you can't con- fuse a grocery-anchored neighborhood center with an outlet center," said Michael Tubridy, ICSC research managing editor, "or you're going to have chaos when people talk." To be sure, the phrase "lifestyle center" was sometimes used loosely in the past for marketing purposes, diluting the term's meaning and creating some confusion in the industry, notes Tubridy. And it is hardly the case that every retailer is indifferent to property type, observes John Connolly, ICSC research project manager. In fact, many retailers still tend to focus on the prop- erty types for which they are best known, he says, pointing out that few would imagine a luxury retailer like Saks Fifth Avenue opening a full-price store in a neighborhood center. Moreover, performance benchmarking and other analyses based on specific property types is important for the indus- try — especially given the trend toward publicly traded RE- ITS with portfolios of malls or neighborhood and community centers. Without consistent asset classifications, this type of research becomes more difficult, the researchers assert. "This industry now, especially at the mall level, has so many public companies, compared to when I first started at ICSC in 1990," said Tubridy. "Investors and Wall Street analysts want to have an idea of what type of property they're looking at." ICSC research reports, too, benefit from the efforts of owners and developers to be precise in the way that they classify their assets. "From the data side, I can definitely speak to this," said Connolly. "It would be very helpful." Sullivan concurs with regard to careful categorization. "It matters, because we need to have some sort of distinction or characterization of properties," he said. "It is important to have categories and for a trade organization like ICSC to create those definitions. Just be careful when you use those terms, because what they mean today is different from what they meant just five or 10 years ago." But these attempts at precision can be hampered by an eager, relentless drive on the part of marketing professionals for exciting new lingo with the power to draw retailers and shoppers, observers note. Instead of calling a project a "pow- er center," for example, a marketing team might describe it as "an experiential retail, dining and entertainment complex." But within the more formal communications of the indus- try itself, such as when brokers share property information with potential investors, the participants generally encounter terminology that is less high-blown and more accurate, says Beyer. "You do see these definitions used in the marketing of centers for sale," he said. "There, it's important to have an overall, general consensus as to what the property is." Still, far from being rigidly codified, these definitions can and do breathe and evolve along with major trends, Connolly says. "While we have the definitions, the definitions are not set in stone," he said. "They are guidelines to try to move toward what is a typical type of shopping center historically." As a case in point, Tubridy points to when the industry began using the term "superregional mall" in the 1970s and '80s, as regional malls started expanding beyond the general range of 400,000 to 800,000 square feet and thus drawing from larger trade areas. Some observers opine that there are ways to be accu- rate about hybridized properties without creating new and potentially confusing terms from scratch: Unsure whether a project qualifies as a factory outlet mall, an owner could describe it as a large neighborhood center with a substan- tial factory outlet component; unclear whether a project is a lifestyle center or a community center, the marketing team could bill it as a pedestrian-friendly community center with lifestyle components. The ICSC research department tends to revisit these clas- sifications every decade or so, and the current terms could thus be reviewed in the near future, if clear reasons emerge to do so, says Tubridy. "As owner-developers innovate and continually reevaluate their properties, they are going to keep pushing at the edges of some of these criteria," Tubridy said. "But I think the ultimate value of having consensus defini- tions will still be there." n 'NO EXCUSES' RETAIL LEASING TRAINING Canvassing Workshops Goal Setting Career Coaching Team Building Speaking Engagements Property Assessment Strategy Beth Azor - The Retail Leasing Queen - has over thirty years of experience in managing, developing, redeveloping and teaching commercial real estate leasing agents all over the country and she can help YOU! Beth Azor www.bethazor.com Tel: 954-615-0615 beth@azoradvisoryservices.com

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