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Retail developers should look to inner cities for future projects

The 2009 European Conference of the International Council of Shopping Centres in Barcelona was told that developers need to work hand in hand with cities to plan for the future.

Shopping centres can support the renaissance of city centers and the current global downturn offers the chance to create a win-win situation, Alexander Otto, chief executive of ECE, told the conference.

'Integrated shopping centres in top inner-city locations can support the current renaissance of the city centres and in return profit from this trend. I strongly believe that long-term success for shopping centres is only possible in an equally successful urban environment,' he said.

He explained that the financial crisis has put the uncontrolled expansion of non-integrated green field shopping centres on hold for the time being. This gives the industry time to develop sustainable concepts for prime inner-city locations that also bring the greatest benefit to the cities themselves.

He pointed out that many speculative construction projects in European cities have collapsed. 'With land prices falling, attractive city centre sites will once again become available for modern retail projects in many countries,' he added.

He described Germany as a role model and said that many of the Central and Eastern European markets could look at what has happened there.

Otto described how European cities are currently undergoing fundamental changes. In many places, everyday life has migrated to the outskirts and suburbs, drawing purchasing power away from the city centres. Most cities are spending less and less on making public spaces attractive and the spread of international chain outlets has created a situation in which many city centres are interchangeable, while entire branches are disappearing from the high streets due to high rents.

At the same time, the market share of discount stores on greenfield sites has been rising dramatically for a number of years and all of this has combined to contribute to the demise of city centres.

'Despite all these developments people want to come back to the city centre. If they are planned well and built well, then shopping centres can help to solve many of the existing problems,' he said.

And he warned against following the US example. 'Europe needs European shopping centres that are sensibly integrated into the urban environment and architecturally ambitious,' he added.