With the designer outlet market experiencing a boom as a result of price-conscious consumers looking for the best bargains, the capital’s newest offering the London Designer Outlet (LDO) looks set to be a big draw when it opens in late 2013. Drapers talks to head of retail at Quintain Estates and Development Phil Cottingham about his plans for the scheme.
What will set LDO apart from the competition?
Our destination, adjacent to Wembley Stadium sets us apart and the blend of uses that support it, such as the new four-star Hilton situated next to it, and its proximity to the centre of London. The catchment area is also very rich – both culturally and economically speaking – and very diverse.
We’ve got your typical anchors such as Nike and Gap, which are the staple diet for this type of scheme. You need to satisfy what your customer wants in terms of retailer mix, and from having done global research groups we’re well on our way to achieving that. We won’t be going super luxury, but there will be some aspirational premium brands, which has been informed by the research we’ve done.
Why do you think the outlet market is doing so well, when more traditional shopping destinations such as high streets are faltering in certain locations?
The economy has helped in that consumers have picked up on the fact that they can still buy the brands they want to buy, but with a discount. You’ve got a similar phenomenon with TK Maxx. However, I think what outlet offers over that type of operation, and particularly if you’re looking at an LDO or similar, is the mix of leisure and retail. Although we’re in difficult economic times, most people aren’t prepared to give up their perceived standard of living, so they are heading to outlet centres.
How can you ensure that outlet centres still provide a ‘special’ shopping experience?
Consumers are becoming more sophisticated and the more advanced outlets need to focus on customer service, and provide a nice environment that is safe, clean, secure and in terms of finishes and so on. A lot of that comes from providing a good range of bars, restaurants, coffee shops, but also via facilities, such as a concierge bag-drop service. We’re certainly going to be looking at that, as well as a loyalty card, and are talking to delivery companies about providing a delivery service within a certain radius.
Why is the outlet market becoming more attractive to luxury retailers?
I think there is this realisation that as a retail channel, outlet is one of the few that is growing. There are around 200 outlet centres operating in Europe and a further 50 being developed around the world, so it is a growth market.
The high street appears set for something of a sea-change as 50% of high street and shopping centre leases are set to expire by 2015 as historical leases expire. What impact will this have on the retail landscape?
There will be lots of negotiations to be done and lots of opportunities for people then. For those retailers wanting to do something different with their property portfolio they will use it as an opportunity to exit underperforming stores. However, in my experience normally someone else will be ready to take on the unit with a new concept, and a lot of those will be renewed anyway. The caveat to all that is making sure there is a strong partnership between the occupier and the owner and making sure that they are aligned in terms of their objective.
- 350,000 sq ft development
- 85 retail units and 15 restaurant units
- Local catchment – 782,000 within a 20min travel time
- Primary catchment – 10.4m within 60min travel time
- Closet outlet for 5.8m people
- ABC1 62.5%
- 40% of space is now let
- For more on the fashion retail property market read Drapers Property Special in our September 7 issue