What happens now, when the – according to some – overheated shopping centre market cools down? Will shopping centres be forced to close down and will we face empty store space?

The shopping centre industry has had many good years, in Sweden we have had 146 months of consecutive growth.  Owners and investors have invested in and managed their centres with the motto ‘the bigger the better’. Many have extended their lettable area to increase their attractiveness and to get market shares.

The change in the economy has made transactions scarcer and postponed several extension plans. Added pressure from tenants wanting to renegotiate their rent level forces shopping centre owners to rethink their strategy and shift from large scale extensions to refurbishment and active management.

Future increased focus on the NOI will demand more resources and competence in the market shift. Many owners are unprepared of the shift to the tenants’ market and also of the increased demand of presence, improved customer relations and knowledge of the tenants’ business.

The vacancy levels are likely to rise, but proactive and continuous dialogue with the tenants can help to avoid empty stores. We will not see any abandoned shopping centres in the Nordic countries, but some badly located retail parks will probably suffer from vacancies.

In a competitive environment the most skilled wins. More knowledge and competence in profiling the shopping centre is needed in order not to be stuck with a losing hand. To make a shopping centre interesting and profitable knowledge, constant change and good relations are necessary.