Investment approach

In our most recent materiality assessment our stakeholders ranked ‘future-proofing our portfolio’ as our second highest material topic. To us, this means selecting relevant assets and making these more sustainable, both economically, socially and environmentally. We aim to create inspiring urban environments that will retain their appeal for future generations and seek to align with the sustainability agenda of municipalities by improving both the environmental and social impact on local communities and business where each asset is located.

The rise of e-commerce is shifting the landscape of in-store retailing from a sales centric function to an experience-led engagement with shoppers. Being able to identify strong investment locations has become increasingly important. Based on our own research and our view on trends happening in the market today, the internet is accelerating the polarisation of retailing into ‘experience’ or ‘convenience’ shopping. We observe consumers adopting a new ‘retail state of mind’ where a need-to-buy mindset is shifting to a need-to-enjoy mindset, which influences consumers’ decisions about their favourite retail destinations.

It is therefore crucial to transform the retail offering by moving from a points of purchase approach to one featuring points of engagement with shoppers. Understanding these changes enables us to identify opportunities and tailor our property offering to suit the needs of our tenants and retailers. As shoppers become more demanding in what they expect from venues and their surroundings, our investment choices must address their needs holistically. If we do that correctly, both our retail customers and our investor clients will benefit.

To mitigate location risk based on the above trends, we believe that an in-depth view on a city’s attractiveness for retail real estate investment is crucial for our continued success as a business. The right mix of qualities that inspire and appeal to future generations will determine which cities and locations succeed or risk failure in the long term. Our ability to identify future-proof locations is at the core of a successful real estate investment strategy, since it drives performance. We created our City Attractiveness tool back in 2012 already and have been refining and updating the tool every year to keep our view on cities as up-to-date as possible. For cities ranked as ‘attractive’, we use our Asset Attractiveness Tool to determine what constitutes a responsible investment. This assesses the perceived quality of a market and its current and future risks and opportunities. For more details on these tools, please visit our website.