Stylish shoppers flocked to Jervis shopping centre last week, eager for a good deal—or maybe just to see who else could be persuaded to pay for overpriced lattes. Up to 13 first-round offers popped up like mushrooms after a rainstorm for this Dublin gem—or should we say, cash cow—recently placed on the market by its not-so-humble owners, Paddy McKillen and Padraig Drayne, who must be feeling like the Kardashians of commercial real estate.
This is the first round of bidding since the 1990s, a time when people still believed that retail therapy was a real thing, and not just an elaborate excuse for impulse buying. Let’s face it: it’s one of the last shopping centers clinging to its original developers, this “here today, gone tomorrow” gem they crafted with such care back when hair was bigger, and wallets were fatter.
Bidders included major players like the Comer Group, US property titan Hines, and an array of others that would make a bingo card look like a children’s drawing. And let’s not forget that recent auction frenzy that saw Marlet’s trio of retail parks field ten initial bids—because who doesn’t want a chance to invest in a retail market that was once declared dead?
For over a year now, retail has been doing its best impression of a phoenix rising from the ashes, attracting more capital than any other sector. Meanwhile, offices and private rented schemes have turned into wallflowers at this real estate dance party, awkwardly waiting for someone to ask them to shuffle. And they say Covid did a number on retail—clearly it underestimated this sector’s resilience!
Take a gander at the statistics: AIB’s latest retail report boasts that in-store spending has spiked by 2% over the last year. Shocking, I know. And in a delightful twist, the EY Future Consumer index reveals that seven out of ten people prefer anonymity in brick-and-mortar stores rather than the cold embrace of e-commerce. Who knew picking up something tangible gave people such warm and fuzzy feelings?
Jean McCabe, head honcho at Retail Excellence Ireland, claims that customers are “returning for the experience.” Retailers, it seems, are opening more stores, probably for the same reason you stockpile toilet paper when a pandemic hits—like documenting a once-in-a-lifetime event that everyone keeps insisting will inevitably happen again.
Brendan McDowell of BPerfect Cosmetics, the poster child for online-to-offline success stories (and quite the overachiever), has opened thirteen physical stores in five years. He’s even utilized pop-up stores like training wheels before committing to the full retail bicycle. “We could negotiate shorter-term leases and enjoy longer rent-free periods,” he mused, as though he was discussing a new coffee blend, rather than the uncharted waters of retail strategy.
In a world where every retailer clamors to shake hands with economic reality, retail parks are considered “the golden child.” They can provide yields that could convince almost anyone to trade their collectibles for some good old-fashioned bricks and mortar. And yet, with international buyers eyeing potential acquisitions like covers for a magazine, the market presents a tantalizing tango with few willing to dip their toes in the pool. The only construction happening is either purposeful or old news—unless, of course, it incorporates a burrito bar.
Amid all the excitement, there remains a small sliver of sobering reality: certain retail locations are struggling, while some retailers are sprinting toward the exit signs. The collapse of chains like Debenhams and Arcadia Group, reminiscent of dust settling in abandoned towns, leaves opportunity knocking on new ventures. If past mistakes have taught us anything, it’s that the only constant in retail is change—well, that and the perpetual “Buy One Get One Half Off” signs that never seem to disappear.
In conclusion, amidst potential doom and gloom, retail is trading places. The real estate game seems like a program on repeat—familiar faces come and go as new ones shuffle in, sometimes replacing stores that have closed, but occasionally offering us an experience wrapped in nostalgia. Who knows, perhaps every failed endeavor paves the way for some savvy startup to swoop in and capitalize on the chaos—as long as they don’t forget to pack a sense of humor.
