Doctors, dentists, gyms and libraries are taking their place along side traditional retail stores and turning shopping centres into communication destinations.
Ice-skating rinks, restaurants and cafes and beauty salons are also being added to modern shopping centres around the country. It's just another weapon being used by retail landlords to fight back against online shopping, with many of those services unable to be provided online.
Stockland (ASX: SGP) head of commercial property, John Schroder has told the Australian Financial Review that shopping centres already play an important part in regional communities. Consumers can now book activities and services online before arriving at the shops.
AMP Capital, which manages shopping centres and part of AMP Limited (ASX: AMP), has developed smart apps that aim to help customers shop more efficiently. With more and more Australians owning smartphones, there are certainly opportunities to use apps to attract shoppers to the centre. Apps can suggest clothes styles and brands, and even assist customers find their cars. If you've ever lost your car in a multi-storey shopping centre car park, you'll know how handy that can be!
By increasing the variety of products and services available, individual retailers in shopping centres should benefit, as the foot traffic increases (that's the number of people walking through and around). Landlords want to get people to think of regional centres as more than just a place to shop, and adding new services gives people more reasons to stay longer and spend more money.
Westfield Group (ASX: WDC) has been one of the pioneers of mall development in the US, taking the Australian centre concept to Americans and the rest of the world. It was one of the first companies to meld traditional grocery stores with high end retailers in the US, and now is one of, if not the largest shopping centre owner (by value) in the world.
The Foolish bottom line
Shopping centres will continue to evolve, and we are likely to see hotels, apartments and office buildings added to centres in future, while an increasingly diverse range of products and services will also be included. That is likely to see them increase in size, and attract more customers. The death of shopping centres has been greatly exaggerated.
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Motley Fool writer/analyst Mike King doesn't own shares in any companies mentioned. The Motley Fool's purpose is to help the world invest, better. Take Stock is The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, whilst it's still available. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
