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Kelly Miller: Australians were quite fortunate at the beginning of Covid and then when we started to get significant cases, it was a completely new landscape for retailers, consumers, and the landlords or real-estate owners. We had to set up new systems and processes and new ways of managing and tracking people. It was an incredibly complex environment.
And over that was the emotional toll it takes on all of those people – you cannot underestimate that – and then there’s the financial burden of when you’re living with Covid and people cannot trade the way they did before. They can’t live or play or enjoy life the way they did. There are a lot of complexities you’re dealing with as a retailer and a real-estate owner. I think most of the industry handled that really wonderfully. When we started this calendar year, we were already getting back to FY19 levels. So the consumers and the retailers are just so happy to be back. We saw some really great productivity and traffic came back positively across our portfolio. I think the industry, largely, was very similar.
Except for the CBD. That has been very challenged, because commuters, understandably, have been apprehensive about getting on public transport. So they have definitely shifted the way they work. And when we started the next round, it was much, much more significant in that there were more deaths, there was more sadness and more mandated closures, more restrictions and people locked down. So the stress on the retailers was much more significant.
And so now we’re all coming out of that. I think everyone’s looking forward to a really positive and safe Christmas, where we can really start to trade again. We hope it will be like the beginning of the calendar year and we’ll start to get back up to FY19 levels of traffic and sales performance. But of course, stock, range, and safety measures – all of those things are now a new world order. People have shifted in what’s important to them. Safety was always important but I think it’s now a baseline requirement that hygiene and safety must be at optimal levels.
I think community and social interaction are much more important in our shopping centres than ever. They were always places where people interacted with family and friends, but that’s been amplified and we can see that with the bounceback at the beginning of this year. People absolutely want to engage and have fun with their family and friends, but they also want to engage with their community and learn with them. We’re seeing that in some of the pilots and activations that we’re doing, we’ve had such great take up.
Then the other thing is how we help retailers that have shifted their business model continue to run both bricks-and-mortar and online. Embracing omnichannel operators is a focus for us because what’s important for the consumer is flexibility. But property is a difficult model to adapt., so we’re working on how to account for click-and-collect and drive-through and omnichannel delivery for our partners as effectively as possible. It’s a great business model for them.https://player.vimeo.com/video/641311356?h=6043a02bee&dnt=1&app_id=122963Here, Mirvac’s Kelly Miller discusses the future of physical retail with other retail experts.
IR: We’ve been talking about experiential retail for years, but now, if you want people to really get away from their computers and devices, you need to give them something fun when they go to shop. What does that look like for shopping centres?
KM: From a community perspective, ultimately, we need to start using our spaces to offer things they can’t get in other environments. Shopping centres are just another safe, fun place for people to engage. And we’ve got such great traction with our offers across the country. There’s WeMake at Rhodes [in Sydney], it’s a maker space in a shop. And prior to Covid, we had such positive engagement and feedback from not only our local community audience, but a broader audience around learning how to put a computer together, cheesemaking, graffiti painting, kids’ classes and parties. There’s something for everyone.
We need to constantly inject fun and learning and theatrics into our centres because they’ve been the lifeblood of essential services for our industry and our consumer audiences. You want to continue that great interaction and continue to give them things that are beyond just essential services. What you’ll start to see is a shift where sometimes you’ll see brand takeovers, sometimes you’ll see community engagement, sometimes you’ll see activations with purpose, whether it’s Chinese New Year, Mardi Gras, Mental Health Week, or Sustainability Week. Shopping centres should celebrate all of the major milestones that are really important to Australians, and from our perspective, we will celebrate them loudly and proudly because it’s important to all the people in those communities.
IR: Tell me more about WeShow and how it works.
KM: In simple terms, it is a rapid-delivery retail model. It’s a fully flexible, full-service retail solution. We’re able to build something custom made for retailers and turn it around within 24-48 hours. It’s not a typical lease structure. It is tailored to the individual business or brand, so they can work with us to determine their terms and their length of time. It is a simple structure, you don’t want to make it too complicated because sometimes businesses don’t want to be in a shopping centre. They don’t want to find a lease and a complicated design manual. It’s not easy for them. Ultimately, it is an opportunity for people to garner new audiences and grow their business in bricks-and-mortar without the cost and challenges of setting up a traditional long-term shop.
IR: WeShow is now expanding to Toombul Shopping Centre and Kawana Shoppingworld in Queensland and Sydney’s Birkenhead Point, but can you tell me about some of the lessons you learnt from its first iteration?
KM: The greatest learning for us was having the lens of a small-business owner, rather than that of a property expert. Development applications and building and marketing all those things are second nature to us, but they’re not second nature to someone who’s new to property. I think the big learnings were that there is genuinely a place in our portfolio and in the industry for reduced-term lease commitments or no long-term lease commitments. There’s definitely a requirement for flexible models that respond to partner preferences. There’s absolutely a requirement for a partnership to be formed on mutual terms and for us to provide more services and use our expertise to make it easier for people to grow their business. We pick the spaces and we help them design our locations, we help them market it. All of those things are second nature to us. It’s something we’re really proud of and we think there’s a true need in the business environment.
The standout for me is how do we use technology to give them really insightful information to respond to that fits their business model? That’s the big opportunity for us. The next iteration of WeShow is around how we use camera technology and data led insights to help them evolve?
IR: I’d like to ask you about Mirvac’s investment into [fashion app] Mys Tyler. Can you tell me about that investment and what that means for Mirvac?
KM: We have Novak Ventures within our business, which invests in people who have values or a business model that we think we can help grow or work with because we have an alignment in some manner.
Mys Tyler founder Sarah Neill is a remarkable businesswoman. What we loved about her in particular was she has a sustainability lens. She focuses on community building, with inclusivity at the core. Sarah created the Mys Tyler community because she could see a couple of things. One was that women of all shapes, colours, sizes and ethnicities couldn’t actually relate to a model or a celebrity when they were trying to find clothes. They had no community to interact with that maybe had the same ethnic background, or the same size or shape or style.
Sarah also thought there was a massive gap because she couldn’t find clothes that fit and then she also was really concerned about the fact that people were ordering a size 10, 12, or 14 and getting them all shipped to them and then sending back what didn’t fit – it’s not a particularly sustainable way of doing things. They had to try things on, the cut wasn’t right, the fabric wasn’t right. And she thought there had to be a better way. So she thought there was an opportunity for her to create an online community where people could interact. And then they can start to learn about their style, they can start to address some of the sustainability issues. That community has gone from strength to strength. She’s capital raising again in New York now, and it is a global community.
Shopping centres have to embrace all of the parts of their community and offer them an opportunity to interact. We love that Mys Tyler is connecting a global community of like-minded individuals who want to be kind, but also share style ideas, but also with a sustainability lens. It was just beautiful to us. We couldn’t be more thrilled with the partnership. [We just did] a styling advisory in Toombul in Queensland, where her team worked with the Toombul community to help ladies of all shapes, sizes, ethnicities, and backgrounds meet and learn about fashion.