Retail Property Research Articles

The Impact of Transit-Oriented Development (TOD) on Retail Property Rental Value in Jakarta's Block M Area

This study aims to analyze the impact of Transit-Oriented Development (TOD) development on the rental value of retail properties in the Blok M area, Jakarta. The background of this research is based on the increasing adoption of TOD as a solution to traffic congestion and increased accessibility in urban areas. This research uses a qualitative method with an approach to interviews, observations, and document analysis. The results of the study showed a significant increase in the rental value of retail properties after the implementation of TOD, especially in three main shopping centers: Blok M Square, Blok M Plaza, and Blok M Mall. The percentage increase in rental prices per year reaches an average of 15%. These findings show that TOD contributes positively to the increase in retail property value in areas with high accessibility. In conclusion, TOD has an important role in supporting the economic growth of urban areas through increasing the value of retail properties.

A framework for the management of retail assets

PurposeThe retail investment landscape in the UK has drastically changed. Understanding owners’ responses to this structural change is critical to gain insight into protecting investment performance. This paper identifies and evaluates the tactics and strategies being adopted.Design/methodology/approachThis paper employs a mixed methods research approach, using data collected from semi-structured interviews with professionals involved in the retail investment process. This is supplemented by secondary market data analysis.FindingsThe paper assesses the practical responses made by retail property owners/managers, structured around emerging sub-themes. Actions include mitigating short-term risks through greater use of temporary tenants/licensees and independent retailers, preparing generic “white box” retail space to capture remaining tenant demand, exploiting the tenant mix to provide “the retail experience,” and applying new technologies and processes in a sector where systematic risk remains high. A new framework for retail asset management has been developed.Research limitations/implicationsThis study contributes to the retail asset management literature and understanding of the way the contemporary retail landscape is shaping investment management behaviour.Practical implicationsThe developed framework provides guidance to real estate managers developing a retail real estate management strategy and will help them recognise tactics to better support the evolving retailing market.Originality/valueThe new framework adds new insights to understanding the process for managing retail assets and the actions necessary for asset managers to address economic/functional obsolescence and sustain asset investment values.

Spatial-Temporal Analysis of Residential Housing, Office Property, and Retail Property Price Index Correlations: Evidence from Ten Chinese Cities

Using correlation-based hierarchical analysis and synchronization analysis, this study focuses on monthly price indices for residential homes, office buildings, and retail properties in ten major Chinese cities for the years 2005 to 2021. Through these analyses, one can identify interactions and interdependence among the price indices, heterogeneous patterns in synchronizations of the price indices, and their evolving paths with time. Empirical findings suggest that the degree of real estate price comovements across all property types and cities is relatively low and stable from January 2017 to February 2020, followed by significant increases during the COVID-19 pandemic from March 2020 to January 2021 and significant decreases since February 2021 with the recovery of the economy. Several groups of property types and cities are determined in this study, each of which having its members reveal rather strong but volatile synchronizations of price indices. Rolling importance analysis does not suggest persistent increasing or decreasing trends for the real estate price associated with a specific property type and city. Policy studies on real estate price comovements may benefit from these findings here.

Observation scale of space value for measuring successful shopping malls, a case study in Indonesia

ABSTRACT Establishing the value of retail space is the key to the success of shopping malls. The research in this field attracts attention, where the rented spaces have the same value to create the highest profit for tenants and shopping mall owners while providing convenience for visitors. The aim of this research is to verify the factors that form space value using scoring techniques on shopping malls in Indonesia. This research method uses triangulation with sequential and simultaneous approaches. Qualitative uses observational case studies followed by quantitative through assessment scales confirmed by expert practitioners shopping mall development. Jakarta and Surabaya were chosen as research areas with the highest population levels and the most shopping malls in Indonesia. The results show that three factors form space value: spatial layout, accessibility of space, and visitor visibility. Shopping malls in Indonesia are more dominated by one of the space value factors, while other factors are not so highlighted. These findings produce a scoring technique that can be used as an evaluation tool for implementing space value in shopping malls and pave the way for researchers interested in the retail property sector regarding strategic retail space planning, especially shopping mall development in developing countries.

포스트 코로나 시대 부동산시장의 전망과 과제

This article aims to explore the impact of COVID-19 on the real estate market and the changes necessary to navigate the post-pandemic world. The COVID-19 pandemic has significantly impacted the real estate market, causing changes in consumer preferences, behaviors, and economic factors that have affected various sectors, including residential, commercial, and retail properties. As a result, the industry has had to adapt to a new reality, with challenges and opportunities arising in response to the pandemic's effects. The residential real estate market has seen a shift towards suburban and rural areas, with homebuyers prioritizing space, privacy, and features that accommodate remote work and virtual schooling. Meanwhile, commercial and retail properties have faced challenges as businesses adapt to remote work and changes in consumer behavior. This paper supports that as the world transitions into a post-pandemic era, the real estate industry must continue to evolve to meet the changing needs of consumers and businesses alike.

Agency problems in facility management (FM) outsourcing in the Ghanaian retail sector

Purpose The aim of this study is to examine the agency problems that arise between retail property owners and outsourced facility management (FM) service vendors in Ghana. Design/methodology/approach This study was carried out using telephone and face-to-face interviews. Nine facility managers (n =9) and six retail property owners (n = 6) purposively selected participated in the interviews. The responses from the interviews were analysed using content analysis. To begin with the analysis, the recorded audio for each respondent during the interviews was transcribed to augment what was written during the interviews. The next step was the development of a coding framework where each of the agency problems was assigned unique codes and grouped under themes. Each response was assigned a predefined code based on the agency problems identified in the literature. The research team discussed the consistency of the thematic codes assigned to each of the responses to ensure that each response was captured under the appropriate agency problem theme it best represents. Findings The results showed that agency problems in FM outsourcing in the Ghanaian retail sector are related to disagreement on expenditure associated with maintenance and repairs and improper tenant information sharing and use by FM service providers. Based on the findings, it is recommended that property owners explore the mixed approach to FM to mitigate the risks of complete outsourcing of FM services. It is also recommended that a clear path on how tenant information can be shared be pre-agreed in FM contracts. Originality/value This study provides new literature relating to agency problems in outsourcing and may be the first of its kind for FM in the Ghanaian retail industry. The findings could serve as a starting point for service providers and their principals to find common grounds to understand each other and mitigate the agency problems that could arise and their overall impact on performance.

Impacts of parking and accessibility on retail-oriented city centres

Growing e-commerce, the aftermath of the COVID-19 pandemic, the need for greater sustainability, and increasing competition between different uses for scarce space pose increasing challenges to city centres. Most city centres in high-income countries are strongly characterized by retail. To create space for other mobility modes, outdoor dining, or greening, reducing on-street parking is a controversially discussed measure that is feared especially by retailers. However, the impact of parking infrastructure and accessibility on the performance of retail in city centres is not yet clearly explored in the literature. This paper contributes to closing this research gap by analysing the impact of on- and off-street parking capacity and accessibility on the rents for retail properties in city centres. The applied database consists of nearly 400 retail rental offers in the city centre of Aachen, Germany, published between 2015 and 2022. As the data cover the period of the COVID-19 pandemic, we also consider the impact of the pandemic on retail rents.Results of a spatial regression indicate that public transport stops, pedestrian zones, and public parking garages nearby increase the attractiveness of retail locations. On the contrary, much on-street parking capacity in the immediate vicinity reduces retail rents. However, sufficient parking capacity should be accessible within a comfortable walking distance. This finding supports the approach of reducing on-street parking in city centres while concentrating stationary car traffic in multi-storey car parks.

The Effect of Market Asset Returns, Economic Conditions, and Firm Fundamentals on Net Lease Capitalization Rates

This study fills a void in the literature by examining real estate capitalization rates for single-tenant net lease (STNL) properties. First, we examine cap rate variation in relation to market and firm-level fundamentals using individual transaction data in a multistage regression approach. Second, our single-tenant dataset, which allows us to control for characteristics such as industry and tenant credit ratings, gives us unique insight into not only the pricing of cap rates, but also their underlying drivers and their relationship to market fundamentals and returns on alternative assets. Using this unique dataset of more than 8,000 single-tenant net lease retail property transactions, we develop a quarterly cap rate index controlling for Metropolitan Statistical Area (MSA) and industry fixed effects, property and lease characteristics, and localized influences such as population density and household income. Third, we examine the effect of excess corporate bond spreads, excess stock returns, stock market indicators, firm financials, and economic and demographic indicators. Finally, we examine the effect on cap rates of MSA characteristics such as size, wealth, poverty, crime, gross domestic product, and growth. The findings show that, besides the systematic risk from stock and bond returns, national and metropolitan economic forces and firm fundamental factors explain variation in cap rates.

THE IMPACT OF ONLINE SHOPPING ON SHOPPING CENTRES IN KLANG VALLEY, MALAYSIA

Real estate has been a spectator to technology disruption for the past few years as many activities that used to be mediated by physical spaces within buildings are presently being shifted to virtual space. Markedly, this is the case in shopping as brick-and-mortar retailers are being disrupted by e-commerce. This study’s premise is that it is not clear whether the emergence of online shopping would transform the physical retail property sector in Malaysia. To gauge the impact of the disruption on the physical space, this study conducted a survey among the shoppers in Klang Valley, Malaysia to determine the preference of shoppers to shop virtually or in the physical spaces at shopping centres. From the findings, it is found that the virtual space is not identified as an immediate and direct threat to physical space by shoppers. The synergies between the virtual space and physical space have to be explored so that the existing physical spaces can be designed to ensure sustainability with shoppers’ preferences.

The ‘Most dramatic evidence of progress and expansion’: building regional shopping centres in western Sydney in the 1970s

ABSTRACT This article charts the development of regional shopping centres in Sydney’s western suburbs during the 1970s. It shows how rapid population growth on the metropolitan fringe encouraged investment in large-scale retail property development that accommodated the needs of the city’s biggest department store firms. Many of these firms had been involved in the first wave of shopping centre development in middle-ring suburbs in the 1960s. In the 1970s, however, almost all design and construction of regional shopping centres was undertaken by specialist development firms that had honed their capabilities working for retailers during the 1960s. Retailers and developers conducted research to determine ideal site locations, but were guided by the prescriptive hand of metropolitan planning authorities. This meant that Sydney’s retail landscape reflected diverse influences: American style shopping centres were built in locations determined by European planning ideas and occupied by Australian retailers. Planning regimes also constrained subsequent development ensuring that the regional shopping centres built in Sydney’s western suburbs in the 1970s remain at the top of the region’s retail hierarchy today.

Recycling English town centres – from retail to healthcare: surveys, views and next steps

PurposeMany town centres in England exhibit high retail property vacancies and require regeneration. Several alternatives for the replacement of town centre retail (TCR) have been suggested, one of which is healthcare. The healthcare sector in England is in distress, with the National Health Service (NHS) tackling extensive patient waiting lists, whilst operating from an ageing estate. This paper is an introductory study that uses seven carefully selected personalised surveys to raise academic awareness of the importance and potential of integrating healthcare into town centres and calls for large-scale research to establish the statistical validity of the reported observations.Design/methodology/approachThis study is developed from an interpretative standpoint. Through semi-structured interviews with key stakeholders specific to retail-to-healthcare conversions, this study reports stakeholders' perspectives on opportunities and limitations for such conversions to give direction for large statistical research in the future.FindingsAll participants support the integration of healthcare into town centres and agreed that diagnostic services, mental health support and primary care services are appropriate for provision within town centres. The participants advocate large-scale change in town centres in England, with integrated healthcare co-located with complementary services to fit with wider regeneration plans. Participants prefer adaptation of existing buildings where technically feasible and emphasise the importance of obtaining the buy-in of other stakeholders whilst expressing concerns about the uncertainty of capital funding availability.Originality/valueThis is the first study to analyse the practice of retail-to-healthcare conversions in town centres. These are still rare in England and projects are complex. The market experience is limited, and thus, the literature is scarce. This study fills this void and provides a starting point for future quantitative research in this area and informs the new town-planning policies.

A Gaussian process regression machine learning model for forecasting retail property prices with Bayesian optimizations and cross-validation

The real estate market in China has been growing rapidly during the past decade, with different property price patterns across various regions. Among different types of properties, prices of retail properties have not been sufficiently analyzed. This study focuses on forecasting problems of price indices of retail properties across ten major cities in China from 2005 to 2021 through monthly data and Gaussian process regression models. We examine ten kernels, four basis functions, and two predictor standardization options for constructing the forecast model through Bayesian optimization and cross-validation for each price index. The ten models built lead to accurate out-of-sample forecast results for a two-year window from 2019 to 2021. Relative root mean square errors across the ten indices range from 0.0113% to 0.4835%. Market participants and policymakers could utilize forecast models here for assessing retail property prices.

The spillover effect of E-commerce on local retail real estate markets

Using retail property transaction data and e-retailers’ fulfillment center openings from 2010 to 2014, we find that e-commerce expansion–measured by e-retailers’ fulfillment center openings–increases retail property values by 5.2% in counties with fulfillment center openings compared to similar counties with no openings. The effect appears in year two following the fulfillment center opening and persists through year five. This indicates a persistent divergence in retail property prices between the treatment and control groups. The increase in retail property values is accompanied by a significant boost in employment, wages, and business establishments in the transportation and warehousing sector, supporting the income channel hypothesis. However, we find limited evidence for the substitution channels. Notably, the impact is more pronounced in areas where fulfillment center workers are likely to reside.

서울시 상가 임대가격 결정요인

1. CONTENTS (1) RESEARCH OBJECTIVES The purpose of this study is to empirically analyze the determinants of rental price for retail properties using macroeconomic variables. (2) RESEARCH METHOD This study conducted an empirical analysis of the determinants of rental price using the vector autoregressive model (VAR). The dependent variableis the rental price index for mid- and large-sized retail properties in Seoul, and the independent variables are macroeconomic variables such as corporate bond yields, the number of economically active population, and the amount of domestic construction orders. (3) RESEARCH FINDINGS As a result of the cointegration test, there was a long-term balance relationship between the variables, so it was analyzed using VECM. As a result of the impulse response response analysis, the amount of domestic construction orders and corporate bond yields in the retail rental price were negative (-), and the number of economically active population was positive (+). In addition, as a result of the variance decomposition analysis, it was analyzed that the impact of the corporate bond yield was the greatest when excluding the retail rental price itself from the retail rental price. 2. RESULTS An increase in the number of economically active population, a proxy variable of income and economic conditions, increases the rental price, and an increase in domestic construction orders, a proxy variable of supply, and an increase in corporate bond yields, a proxy variable of liquidity, decrease the rental price.

Shifting prime retailing pitches. A GIS analysis of the spatial adaptations in city centre retail markets

ABSTRACT In this paper, the density and location of retail properties located within the primary retailing areas of Edinburgh, Glasgow, Hull, Liverpool and Nottingham are investigated over a 17 year period. The study is novel due to the original spatial databases developed and unique combination of established methods employed to explore spatial change within these northern UK cities. The paper starts from the premise that retailing markets display adaptive resilience where adaptations in use and variation in retail clustering will occur in response to endogenous and exogenous shocks that disturb the market’s agglomerative and competitive effects. The results suggest that significant new retail-led developments have intra-urban spatial outcomes that impact on the size and location of prime and secondary retailing pitches. In urban retailing centres where there have been no substantive supply disruptions, disturbances in the socio-economic environment can create contractions at the peripheral edges of the prime retailing pitch. This study is significant in providing a historical perspective of the micro-level effects of new development, changing customer shopping habits and shifting retailer location preferences. In addition, the research develops replicable and robust methods that can be employed to examine and monitor spatial change in urban centres. Understanding these dynamic micro-spatial effects are important for the future management of urban centres.

Integration Factors of Design Participants in Performance-Based Building Design of Commercial Property

Design practice has shifted towards a performance approach that is based on an awareness of sustainability goals. Achieving this goal requires the integration of all participants through communication, collaboration, and knowledge-sharing (CCKs), specifically at the design stage. The participants are from different stages of the project which are design management (DM), project management (PM), and facility/property management (FM). The current research has not been able to clearly describe the practice in achieving design performance, especially involving the main three stakeholders (DM, PM, and FM). Thus, this study aims to fill the research gap by focusing on the influence of factors CCKs on the design performance of the commercial property, especially retail property. This will form a design, construction, and operational integration model to achieve the performance of retail properties in forming an optimal space. This study uses a method of quantitative study using a questionnaire survey. It was collected from 111 practitioners of the project participants (DM, PM, FM) in retail property development in Indonesia. There are different results in the correlation that the higher the factor value, the lower the space value performance. This correlation occurs in collaboration for PM, communication for DM, and knowledge-sharing for FM. This interesting finding can be explained empirically according to the preferences of each participant. This study contributes to knowledge about the influence of CCKs, which focus on the design of performance-based retail buildings to get the highest space value.

Commercial Real Estate Market at a Crossroads: The Impact of COVID-19 and the Implications to Future Cities

This paper aims to examine the responses of commercial real estate markets to COVID-19 and the implications for post-pandemic cities. Using data of Florida’s metropolitan areas in a fixed effect regression model, we find that sales volumes of retail properties decline instantly under the shock of COVID-19 but are followed by a strong recovery after one quarter. Meanwhile, COVID-19 depresses the growth rate of rent for office property, but the impact is short-term, and the office rental market bounces back to about 70 percent one quarter later. In comparison, industrial properties witness a rise in the growth rate of sales and rent price. Results indicate that urban planners may consider adjusting the amount of lands allocated to different usages to meet the evolving demands of urban space in the post-pandemic era.

Retail Property Price Index Forecasting through Neural Networks

Rapid growth has been seen in the Chinese housing market during the past decade, and housing price forecasts have become more significant to investors and policy makers. In this study, we explore neural networks for retail property price index forecasts from ten major Chinese cities for July 2005–April 2021. Our goal is to build simple and accurate neural networks to contribute to purely technical forecasts of the Chinese retail property market. To facilitate the analysis, we examine different model settings based on algorithms, delays, hidden neurons, and data splitting ratios and construct a simple neural network with five delays and two hidden neurons. This leads to a rather stable performance of about 1.6% average relative root mean square error across the ten cities for the training, validation, and testing phases. Results here can be used on a stand-alone basis or combined with fundamental forecasts to form perspectives of retail property price trends and conduct policy analyses.

The Local and Network Effects of Rail Transit Network Expansion on Retail Property Values

Using Singapore as an example, we find that the opening of new rail transit lines can boost retail property values in areas not only along the new lines (local effect) but also along the existing lines (network effect) due to the increase in network size. We also show the local effect of a new rail line changes over time at different development stages. Ignoring the time-varying local effect and the network effect could lead to biased estimates of the value-added of rail transit and misguide policy formation in rail transit investment, land value capture, and transit-oriented development.

Location Analysis for Retail Property Investment -A GIS Based Approach: Case Study of Blantyre City

Although there is an increased retail property investment interest, location analysis for retail outlets is inadequate. Site selection is the most significantprocess in retail property investment decision making. Duetoitscomplexity,locationdeterminationcancontributetothesuccessorfailure of real estate investment. Optimal location is relevant in a competitive market as it contributes to guaranteed increased returns. Real estate investors can evaluate a set of potential sitesforlocatinganewretailoutlet.Thisstudy aimedatanalyzing howGIScan contribute to the success of retail property investment positioning through spatial data analysis. Thestudy used GIS application to find optimal location for retail property investment in Blantyre City, Malawi. The criteria for finding suitable sites were demographics, transportation and competiveness. The findings presented the applicability, efficiency and productivity of using GIS in location analysis. Based on the findings GIS can helpinidentifyingoptimallocationthroughmaximizing retail store patronage thereby increasing retail investment return.