Mall skills can boost park life
Published: 11 October, 2006
Capital & Regional manages both The Mall portfolio of shopping centres and The Junction portfolio of retail parks. It is increasingly applying the management disciplines of its shopping centre portfolio to its retail parks, leading to a number of innovations for the out-of-town market.
According to Peter Collinson, operations manager at The Junction, the most important step was the decision to bring the management in-house. By 2004, the company found itself with 19 parks handled by six different managing agents, with as many as 160 different contracts in place. "It was a recipe for inconsistency," he says. "Bringing the management in-house allowed us to close the gap between landlord and tenants."
To signal that it wanted to make a fresh start in tenant relationships The Junction met every retailer at store and head office level, to establish exactly what retailers wanted from a retail park landlord. And a customer satisfaction survey was carried out to use as a benchmark for future performance.
At the same time the supplier network was overhauled. "We went for national contracts for electricals, drainage and so on but kept local suppliers for things like landscaping," explains Collinson. The net result was to bring the total number of contracts below 100, and this achieved real economies of scale. Collinson says previously the service charges had varied from 40p to £1.60 per sq ft. Now they average 82p - 4p below the benchmark Oscar level - but deliver a much higher service level.
The same disciplines were then applied to health & safety issues, which saw the introduction of a Permit to Work system, the installation of CCTV on every park and the upgrading of car park lighting. "There is now a 24/7 customer helpdesk, to cover things not dealt with by the tenants' handbook," says Collinson.
Once all this was in place a second customer survey showed an 8 per cent increase in satisfaction. And significantly there was 100 per cent recognition of name 'The Junction.' "We've successfully established the brand in the mind of the customer," says Collinson.
Although there is an on-site management presence on all parks during core trading hours, Collinson doubts whether all retail parks need a centre manager. "We've created an atmosphere where tenants feel we're accessible even without a centre manager," he says.
So where does the Junction go from here? The fund has grown from £350m to £1.5bn and a recent spate of sales created some liquid capital to be reinvested in parks with Open A1 planning consents, to broaden the occupier base away from bulky goods.
Those parks that have been retained are undergoing a rolling programme of refurbishment, which includes resurfacing and redesigning car parks to make them more accessible. More than 400,000 sq ft of floorspace is currently being refurbished, with capital costs typically varying between £25 and £45 per sq ft, according to Collinson. "We still believe in bulky goods, so long as it's prime," Collinson concludes.
