Last week, a motley crew of shoppers descended upon the Jervis shopping centre like it was a pop-up museum featuring discounts on despair. In a riveting game of “who wants to buy a mall?”, a staggering 13 first-round bids made their way to the table, all vying for the love of this retail gem quietly offered for sale by its owners, Paddy McKillen and Padraig Drayne. Who knew selling a shopping centre could create such a buzz, right?
Remarkably, this is the first time the Jervis has been sold since its inception back in the ’90s, crafted with the utmost care (and plenty of aesthetic choices that lingered into questionable territory). Yes, it’s one of the last shopping centres left in Dublin, holding onto its developers like an aging Hollywood star clutching to past fame. So many memories, so little parking.
Among the keen bidders were familiar names that sound like they’d made a killing in some high-stakes poker game: the Comer Group, the ever-ambitious US property investor Hines, and even David Goddard’s Lanthorn, who appear to be competing for the title of “Most Likely to Own a Shopping Mall.” This auction follows a scene-stealing bidding frenzy for Marlet’s trio of retail parks, which, I might add, received ten initial bids. Excellent news for real estate agents looking to pick up a few extra business cards!
For over a year, retail has been the rock star of the property market, attracting capital like moths to a flame while other segments wallow in their own misery. A wee shout-out to offices and private rented schemes for their valiant attempts at being relevant, but COVID dealt a wonky hand, sparking quite a retail revival. Who would have thought?
According to the estate agents—yes, those professionals trained in the art of positive spin—the first three months of this year saw retail claiming half the value of all deals in Dublin. That’s right, folks! If you were wondering what to toast with your morning coffee, now you know—retail has deserved a gold star.
Now, on to the spiritual revival of bricks-and-mortar stores. Post-pandemic whispers of their demise turned out to be very much like those Chekhov’s gun scenes: exaggerated and purely for dramatic effect. In AIB’s latest retail report, it was noted that in-store spending rose by 2% compared to last year. So, what do we have here? A plot twist! People are returning to stores for the “experience” rather than just staring at their smartphones from the comfort of their couch.
Jean McCabe, the head honcho at Retail Excellence Ireland, highlighted this nuance: customers are flocking back for the “customer experience,” and retailers are merrily opening new stores to get economies of scale. Shopping centres are transitioning their tenant mix faster than a Netflix series can get canceled, bringing in entertainment, dining, and more Irish brands.
In a particularly brave move, Brendan McDowell of BPerfect Cosmetics, who started out in the world of online retail, decided to dive into the physical realm with 13 brick-and-mortar stores in five short years. He had enough bravery to pop up stores across Dublin, testing the waters before signing long leases. “When we opened in Blanchardstown in 2022, many units were empty, making it a bargain shoppers’ paradise,” he said. The man certainly knows a deal when he sees one!
It turns out that retail parks are becoming the favored pets of institutional investors, snatching up properties faster than they can find cash to spare. With strong yields of up to 6%, who’s complaining? Max Reilly from JLL pointed out that buyers are looking for discounts on asking prices, but fear not, it’s all part of “the game.”
While there are still bumps in the road—think high vacancy rates in smaller shopping centres, or the semi-dramatic tales of retailers struggling for survival—there’s a simultaneous flourishing of new ventures waiting to snatch the proverbial hollowed-out shell of the former big names. According to Bannon, closures can be artfully disguised as “tenant mix improvement.” Don’t we love a good spin? It’s almost poetic.
This evolving landscape, where old retail names make their exit, opens doors for fresh brands craving the prime spots left vacant. The new mantra of retail seems to be resilience, leaning on that core truth: out with the old, in with the new. While the big players might be down, the show must go on. Welcome to the paradox of retail!
