04/11/2010 - 00:00

New policy, new era for suburban centres

04/11/2010 - 00:00

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AFTER a decade during which growth of major suburban shopping centres in Perth fell behind that of eastern states operations, new planning regulations have freed-up development investment and provided the impetus for a change in the way centres are develo

New policy, new era for suburban centres

AFTER a decade during which growth of major suburban shopping centres in Perth fell behind that of eastern states operations, new planning regulations have freed-up development investment and provided the impetus for a change in the way centres are developed.

The state government’s activity centres policy has prescribed a new style of development; instead of simply focusing on retail, new centres must include commercial and residential aspects.

“What that addresses is a lot of the imbalances that exist today in suburban developments,” Property Council of Australia senior policy adviser Lino Iacomella said.

“It balances that and improves the suburban community amenity and provides diversity in a whole range of things, from shopping to employment and living.”

One new suburban development about to kick off that embodies the new policy, and represents a new age in retail development, is the Strzelecki Group’s Coventry Square Markets in Morley.

Strzelecki Group principal Greg Poland said Coventry Square was more about the experience, rather than purely as a retail destination.

“That’s why we’ve got taverns in there, we’ve got bars and we’ve got restaurants,” Mr Poland said.

“In this project we’ve incorporated two city squares; we’ve got an external city centre square, with pools and fountains, but inside we’ve got an undercover entertainment square and that’s about 1000 square metres.

“They are areas where you can read a book, have an ice-cream, or bring the family down.

“We’ve kept it much along the lines of Sorrento Quay, where the public can go there without spending money.

“It’s not just a food centre, it’s not just a shopping centre, and it also has other features which definitely bring it into the community realm.”

Mr Poland said the focus on ‘experience’ would give Coventry Square a major point of difference advantage of other regional shopping centres.

“The regional shopping centres just have to get their act together and give the consumers what they want,” he said.

“If they stopped putting in all the same franchises in the shopping centres that look identical, and encourage some individuality, consumers might actually be happier, because you can go to Karrinyup, or Galleria, or Carousel, the shops are all the same.

“Shopping is, in a lot of cases, for the average person on a medium wage, an outing. Centres have to stop putting in all the franchises and give people an experience when they go there.”

WA’s suburban shopping centres have fallen behind their eastern states counterparts thanks largely to the former Metropolitan Centres Policy’s arbitrary 80,000sqm cap on retail floorspace.

As a result, major nationally based centre owners have left centres in WA largely untouched, while eastern states centres have grown exponentially.

Over the 10 years to 2008, Westfield Group spent $3.5 billion on expansions and new shopping centres in NSW, $1.75 billion in Victoria, and $895 million in Queensland, while just $55 million was spent over the same period in WA.

In that same period, AMP Capital Investments completed $800 million in shopping centre developments across the eastern states, with another $1 billion in the pipeline in development applications, but only $150 million was spent on WA-based developments.

But with the removal of the floorspace cap, the major centre owners are aligning themselves for expansion.

In September, AMP announced it was preparing plans for the $650 million expansion of its facilities at Karrinyup and Booragoon.

Westfield Group also is advancing plans for the expansion of its centres. Westfield bought a supermarket-based retail centre at Innaloo in 2006 to provide the opportunity to expand the main Innaloo shopping centre.

DORIC business development manager Keith Somers said he expected more expansion announcements to occur in coming months.

“Everyone spent time during the later part of the GFC getting ready and getting development approvals in line, waiting for that shopping centre floorspace cap to come off,” Mr Somers said.

“Now they are starting to move into ‘how do we do this, do we have the tenant demand?’ stage.

“That’s coupled up with everyone saying there is going to be a boom here in WA with resources, there will be a lot more people coming in, and that flows into a lot more disposable income, which means there is obviously a lot more retail spend.”

 

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