What was the social atmosphere at MIPIM?
Well, #MIPIM2019 has come to an end, proving once again to be a crucial platform for global real estate players to showcase their projects and share their insights and outlooks on the future of the industry.
Amidst the rush of event roundups that are already in circulation, we’d like to offer some unique #Inn_sights from the world’s largest real estate event, with a particular focus on social media; a fundamental driver of conversation during any industry event, setting the tone for the week and connecting delegates from around the world.
Over the course of #MIPIM, we created an insights panel through our social media listening platform, tapping into the biggest inputs of the event’s international online network. Social media listening may sound like just another bit of communications jargon, but we see it as an absolutely crucial function for real estate brands, with the potential to drive positive change, create new opportunities and, fundamentally, help companies, individuals and even whole countries do better business.
It is perhaps no surprise then that we’ve seen an explosion of favourable discussions about investment opportunities over the course of #MIPIM. With a fair share of 15%, “opportunities” was among the key buzzwords of the week, also including “city” and “investment” – owing largely to the presence en masse of local authorities looking to partner with developers, housing associations and developers to reinforce their development pipeline.
We were delighted to experience this first hand having been appointed to coordinate the international communications and social media for the country of Egypt, which this year launched the first every Egypt Pavilion at MIPIM. Egypt made a monumental splash in its inaugural year – with online engagement with the #OpportunityEgypt brand surging as we rolled out a fully integrated campaign including international press opportunities, dynamic digital content and an industry-leading programme of sessions on the stand.
Our social listening also revealed great excitement around regional projects unveiled at #MIPIM’s conferences – the UK in particular. On the ground, it was also great to experience a constant buzz at the Oslo stand, where our client Oslo Metropolitan Area welcomed crowds of delegates to engage in insightful sessions on the Scandinavian investment climate, as well as have the opportunity to be publicly humiliated (in good taste) by Magnus Carlsen, World Champion and Grand Master of Chess.
All in all, we found #MIPIM30 to be an incredibly insightful, productive and enjoyable trip to the French Riviera and we’re already looking forward to next year. For now, we’ll be mapping out our involvement with Reed Midem events from now until March 2020 – in Europe and back in the UK – on-site and online!More
MIPIM: Yachts, champagne and sunshine?
Yachts, champagne and sunshine. That’s the outsiders’ view of MIPIM and one which is always sure to attract some salacious headlines every year. But to take this blinkered view is to hugely underestimate the event’s role in driving global change in the real estate sector. Of course, it remains the place where big mergers are announced and huge investment deals are sealed. However, its real impact comes from how it shapes the towns, cities and countries in which we live, work and play.
Put simply, there is no better place for local authorities, companies and national governments to showcase their ambition and attract the best-in-class funding and development partners to help realise them. Period.
The UK government will be out in force promoting investment opportunities with delegations from The Department for International Trade (DIT), Ministry of Housing, Communities and Local Government (MHCLG), Homes England and the Cabinet Office. UK Cities including London, Manchester, Liverpool, Belfast and Cardiff will also be out in force making a play to attract the world’s best developers, while local authorities from Slough to Glasgow will be presenting their visions for the future.
From an international perspective, we can expect to see a strong presence from cities such as Paris, Oslo, Dubai, and Lisbon. The city of Olso will be promoting its status as 2019’s European Green Capital with a packed programme of events and announcements, as well as the unique opportunity for a game of chess with World Champion, Magnus Carlsen, and their Tuesday Dinner with resident DJ Dr. Alban.
Of the 100 countries attending MPIM, we can expect the likes of Turkey, Egypt, Poland, Belgium and the USA to be especially visible. The country of Egypt – represented by Innesco – will be attending MIPIM for the first time this year as it launches one of the world’s most ambitious masterplanning programmes of 15 new cities, including the New Administrative City recently visited by Property Week. As a mark of their commitment to the event, the delegation will include the Prime Minister, the minister of investment, the minister of tourism and the minister of housing, as well as a consortium of the country’s largest developers. You’ll also see them as sponsors of the Opening Night Drinks reception.
Over and above making things happen at a project level, MIPIM is also taking the lead in pushing forward new trends and ideas. This year’s theme is ‘Engaging the Future’ and with a conference programme including speeches from Ban Ki-moon, the eighth Secretary-General of the United Nations and business philosopher, Anders Indset, the agenda is sure to provide some compelling content to all delegates. Innesco will be at the heart of all these key themes, issues, trends and locations – look out for the team around the event, or be sure to follow our progress @INN_Tweets !
Is the grocery industry succumbing to merger fever?
It has already turned into a saga. Nearly ten months after announcing that they would be joining forces, Sainsbury’s and Asda merger’s plan has been torpedoed by the CMA. The reason being that it would weaken competition and have a negative impact on prices for customers. No doubt that this decision was hard to swallow for the two companies, especially given the context. They are both facing serious headwinds from discount chains and pure online players, and have to deal with the prospect of a potential hike of up to 50% on food prices in the likelihood of a hard-Brexit.
It is no news that the face of grocery shopping has changed significantly in recent years. And still, 9 out of 10 people visit a physical grocery shop every week while nearly half of Aldi’s customers come for the main weekly shop these days, compared with less than a quarter a decade ago. Also and in recent years, Ocado and Amazon have emerged as online competitors while Just Eat, Deliveroo and Uber Eat are taking market share into the takeaway meals category. People’s grocery shopping habits are unquestionably different today than they were a couple of years ago but the problem remains. A merger between Asda and Sainsbury’s would have only lessened the low-cost options available for a customer aiming or needing to save on its grocery. It was neither the time nor the place to let that merger happen.
And still, the grocery industry remains buoyant thanks to the newly announced M&S and Ocado’s £750m deal. While M&S started testing food delivery in 2017, it has not yet launched a service and a tie-up with Ocado would help fill that gap. But will it work? For starters, delivering groceries to customers’ homes is an expensive business. Last year, Ocado lost £44 million on a pre-tax basis. Besides, most Marks & Spencer food customers are small-basket shoppers (below £20), while Waitrose’s average customer basket size which is well over £100 and makes the delivery costs easier to swallow. All change is definitely challenging but partnering with Ocado will give M&S access to a larger range of products and a larger average basket size. It also spares the company the time, cost and risk associated with building its own online distribution infrastructure. However, these benefits come at a price and according to analysts M&S may be paying a high price for simply being late to the party.
Innesco welcomes you to the MAPIC FOOD Kick-off Reception!
After a tantalising inaugural event in 2018, MAPIC Food returns to MiCo Milan in May. We are proud to announce that Innesco has the pleasure of partnering with Reed MIDEM on the event for the second year running.
#MAPICFOOD will delve deep into the biggest influences on the international food services industry and invite the most innovative new food concepts, operators, landlords, developers and investors to explore the key ingredients for building the food destinations of tomorrow.
The conference line-up is shaping up nicely; food in retail destinations, dark kitchens and food technology, F&B in travel retail, F&B as a key driver for private equity investment and more. Have your doggy bags at the ready as there will be takeaways for everyone at MAPIC Food.
To kick-off things off, we have been working with the MAPIC team to organise a pre-event meet-up in London, taking place tomorrow on Thursday 28 February at the Soho Hotel. Attendees will have the opportunity to preview some of the main event’s features, meet key speakers and rub shoulders with international F&B’s best and brightest.
We are delighted to welcome our readers to the London meet-up to celebrate the launch of the second edition of MAPIC Food. Places are limited so if you have the appetite, reach out to us now!More
Landlords challenge retailers to a more transparent future
The move towards data-driven intelligence has been one of the biggest changes in business culture in recent years. Yet, there is still one area in which it remains lacking – and that is the exchange of data between retailers and their landlords, according to a recent report in The Times.
Although there is a well worn narrative that the burden of business rates, rising rents, the march of online retailing and landlords’ inflexibility are to blame for the retail industry’s woes, there is a counter argument that retailers need to share more if they really want a more collaborative future.
The disconnect between landlords and retailers is the legacy of outdated lease structures that have traditionally encouraged a passive asset management culture. Many of the more progressive landlords such as @BritishLand are adapting but, across the board, the UK still lags some way behind countries such as the USA, France and Italy, which tend to offer shorter leases that are at least partly aligned to turnover. In most cases, this translates into a healthier and more transparent relationship between landlord and retailer.
However, landlords cannot effect industry-wide change alone and – in order to offer more flexible options – need to understand retailers’ businesses in more detail. If retailers truly want their landlords to be more like business partners then they need to start sharing more of their trading data.
As it stands, landlords have little choice but to rely on either rating agencies or personal relationships when it comes to understanding retailers’ performance. As Lawrence Hutchings, CEO of Capital & Regional, put it: “The transparency around how retailers are performing is getting worse.”
The only way for physical retail to meet the challenge of online retail is to respond with an experience and environment that sets it apart. This challenge applies equally to both landlords and retailers and those who get it right will need to do it in close collaboration with one another. We stand at the cusp of an opportunity to redefine the relationship between landlord and tenant and to shape the future of retailing.More
London remains top global destination for #CRE investment
Since the dreaded #Brexit made its appearance and assumed a starring role in the UK’s political landscape, the real estate market has been trying hard to predict the impact it will have on commercial real estate.
In the midst of uncertainty, this week’s news that #London has retained its title as the world’s number one destination for commercial property investment has come at the perfect time to demonstrate the resilience and adaptability of the UK’s capital. Concerns over Brexit, it seems, have been outweighed by a weak pound and continuing demand for London office space – Brits at #MIPIM will enjoy crowing over this point!
Although total investment decreased slightly from last year, the total deal volume of £16 billion and the average deal size of a record £12 million pushed London ahead of Manhattan, which came second worldwide, followed by Paris and Hong Kong.
According to @knightfrank’s Global Capital Tracker report, Chinese investors being the dominant buyers in Central London real estate was another reason Greater China has been in the news this week, in addition to the celebrations of the Chinese New Year. South Korea’s significantly increased investment in the capital grew eightfold and nearly half of the sum came from @GoldmanSachs’s sale and leaseback of its new London headquarters to Korea’s National Pension Service.
Meanwhile, it’s interesting to see that a report by #JLL found that Middle Eastern investment into western commercial property fell more than a third last year due to oil prices and concerns over #Brexit.
This shows that most likely #Brexit on its own is not enough to determine the size of investment coming into the UK from international markets, but more often than not it is also a reflection of the strengths, challenge and geopolitics that investor countries experience within their market.
How will #Brexit’s full force impact the UK’s real estate market? We will just have to wait and see, but this week’s news about London certainly brings hope to the future of real estate and we’re not headed for #DonaldTusk’s “special place in hell”. #reasonstobecheerful #LondonIsOpen
Outlet centres in the spotlight
Often situated in unlikely far-flung locations that require customers to travel further outside their catchment comfort zones, outlet centres have historically avoided the spotlight. However, this is about to change as new urban outlet centres continue to emerge and prove to be one of the few bright spots in the retail sector – increasingly piquing the interest of investors, landlords and shoppers alike.
In this week’s news, Savills Investment Management (SIM) made its first acquisitions in the outlet centre market with a €300m deal for two French assets. The two outlet centres managed by @McArthurGlenUK represent a total area of 47 300 m2, including the outlet centre of Troyes which is the largest designer outlet of France. SIM sees an opportunity in this often-overlooked sector to achieve “attractive distribution” across their various ownerships. Meanwhile, some outlet centres operators are taking advantage of growing interest in the asset type by selling off parts of their portfolio– with the recent marketing of Spanish outlet managers Neinver providing further evidence of activity across the market. Local Spanish media reported that Neinver’s owners were asking for €500 million and have appointed Credit Suisse to look for potential buyers.
With #outletmallinvestments hitting records in the last quarter of 2018 at €1.7 billion, according to TH Real Estate data, their attractiveness for investors have never been more evident. Outlets have become a defensive investment and an alternative sales channel in the face of growing popularity of online retail – as well as being counter-cyclical versus main-stream retail. With lower levels of volatility compared to other real assets – as seen throughout the last economic cycle, they provide consumers with higher quality and tailored shopping experience. Operators have also begun to increasingly invest into the catering facilities to maximise dwell time, and position their marketing to suit the new, experience-oriented customer.
At the moment, experts argue that outlet centres are best placed to weather the current #retailstorm but as retail is a cyclical industry, will 2019 be the year when the tide will turn?
Is heavy discount the new deal of retail?
According to the @FT, there is plenty of evidence suggesting that consumers are demanding margin-shredding discounts before they even consider opening their wallets and indeed, corroboration is plenty. Just as an example, it is now an established fact that #discountedRetail – as in outlet retail – is far surpassing the gloomy performances of full-price retail: the outlet market is the second most performing segment after online retailing.
But the @FT looked at evidence is a different and fascinating way by testing the resilience of British consumer through their appetite for posh food around Christmas. And the conclusion is that more consumers shifted to mid-price ranges around Christmas, which supports the evidence they were more cautious about their spending this year. Similar evidence was found in France, with discount and hard discount supermarkets attracting more customers than their mainstream counterparts over the Christmas period. Another proof that consumers tend to rationalise their spending, most likely based on the perception that their purchasing power is shrinking.
If evidence that consumers are demanding discounts are mounting, the question remains. To which point is this behaviour sustainable for retailers? Last month and quite surprisingly, ASOS made a profit warning after heavy discounting halved its operating margin, cutting its share price down almost 40 per cent. And if competition recently demonstrated its ability to maintain revenue growth while offering relatively cheap products to customers, a whole set of questions persists: will it last and can retailers afford it in the long run?
Innesco survey, in partnership with Maybe*, reveals what consumers want from their shopping experience
For the last MAPIC edition, Innesco has teamed up with Maybe to collect consumers’ insights around Europe about “What is the future for retail and entertainment in our towns and cities?” This social listening project has delivered over 45,000 valuable thoughts into what consumers really want from their shopping experience.
Change is coming to the retail industry, steering retailers to most importantly take the time to understand how their customers shop and what are their expectations of the shopping experience. This question was at MAPIC, the world’s leading retail real estate conference, that took place over three days last November in Cannes with “Transforming reality – Physical in the age of Digital” as this year’s theme. Innesco took this opportunity to offer inspiring and considered answers from 1m people using a combination of social listening, AI and chatbot technology through Maybe* platform.
The report reveals that shoppers’ behaviour is significantly influenced by online research. 59% of consumers consult their phones in-store on purchases they are about to make, which stresses the importance for many retailers to strengthen their social media presence. Consumers are the real influencers; good reviews and ‘instagrammable’ stores are key ingredients for consumers in their buying decisions. With shoppers switching seamlessly between social media, physical stores and e-commerce, enhancing a brand’s online research resources should be a key priority of a digital transformation initiative.
However, in this digital strategy, what has been mostly overlooked is the lack of digital shopping experiences with only 14% of respondents claim to have had a digital experience in a store that has “blown their socks off”. Consequently, there is an opportunity for retailers to embrace digital innovations and grab omnichannel consumers’ attention with unique in-store experiences that consumers can share on social media and in their reviews.
Another important takeaway from the survey for what shoppers really want in 2019 and beyond is the emergence of cinema visitors as shoppers. Indeed, the report shows that 39% of shoppers said a cinema is most likely to draw them to a shopping centre, with 21% of them said they would also shop. Cinemas still have something that streaming can’t match, remaining an interesting investment for any shopping centre considering this offering.
These meaningful insights provide further opportunities to target relevant online conversations in the social media space and deliver for 2019 what consumers want.
Dan Innes, MD of Innesco says: “This social listening project is the first of its kind and the largest ever undertaken in any sector – just another example showcasing how Innesco uses technology, data and other innovations to conduct research and deliver its findings in effective ways. It’s fascinating to see so much valuable data for the retail industry we can collect through social media listening. The latest is a powerful tool to see how consumer views match up against that of professionals working inside the sector and how to respond to it accordingly.”
Polly Barnfield OBE, CEO of Maybe* adds: “The findings of the project have highlighted the importance of stores being active participants in those conversations to drive their footfall.”
Find out more about the findings of the report here.More
Could Twitter’s new in-house features make third-party tools worse?
It is the news that some of social media’s third-party developers have dreaded, and the news that social media managers have long waited for: Twitter is expanding its functionalities in-house. The networking service has announced this week that more capabilities and features will be available in a bid to maximise business presences on the platform.
The first upgrade comes from Twitter’s own third-party tool. Tweetdeck needs little introduction for those who have been in the social media space for quite some time now. The tool, which is useful for lining up a posting schedule, was just upgraded with the possibility to schedule tweets with video and multiple images. As part of the changes announced this week on Techcrunch, Twitter is also considering a controversial desktop layout revamp and bringing another functionality in-house with new analytics tool to track when your audience is most active on the platform.
The social media giant is playing catch up by adding these new features, which are already available from other social media management tools such as the popular platform, Hootsuite. Indeed, Twitter is very late to the party – which hosts a vast number of third party tools with different capabilities.
However, the key reason why Tweetdeck’s new advantages are important is that they will be customised specifically for the platform, increasing its appeal as a functional and efficient platform for business activities. Worthy of note is the latest EG podcast from Bricks & Mortar series with Susan Freeman, an experienced real estate lawyer, who reflected on the importance of building a social media identity for brands. She emphasised that just a few real estate leaders are using social media and how vital it is, in today’s digital landscape, to encourage them to embrace the shift to social. Consumers interact more with brands and social media remains a huge player in that. Now, with Twitter weighing in on more in-house analytics and publishing capabilities, the platform gains more credibility amongst social-shy property players.
With more and more businesses seeing the power of social media to market themselves, social media management tools are seen as vital, and it’s interesting to see Twitter on the path to cutting out costly tools by providing its own. In an ideal world, Twitter would embrace the enormous opportunity to provide all functionalities into a single and free to use platform. At the moment, the social media giant is catching up at its usual slow pace – but here’s hoping these new Tweetdeck features are merely the beginning of something bigger.