For a landlord, securing the right tenant mix for a retail or leisure scheme is crucial and can quite literally be the difference between success and failure.

This is not simply a case of ‘one size fits all’, but of evaluating each scheme or development, being mindful of the demographics and then tailoring the scheme accordingly. With leisure becoming an increasingly popular addition to retail schemes, and vice versa, getting the balance of the two sectors right has never been so vital: both for future-proofing a scheme to ensure sustainable growth and also for maximising customer experience, thus driving footfall.

Coffee shops and eating outlets are now generally accepted as a staple in any retail scheme and the success of this has driven the appetite for landlords to introduce more leisure amenities into traditional retail locations such as cinemas, children’s soft play areas, gyms and high-end restaurants.

The process of integrating leisure into a new or existing retail scheme is now a well-trodden path, however, it is essential to keep the balance relevant and appropriate to make sure that the leisure element both complements and enhances the retail. There is a risk that too much leisure may dilute the strength of the existing offer and could well deter future retailer occupiers. 

Orchard Shopping Centre in Taunton is a prime example of a retail scheme that has recognised the need to introduce catering alongside the retail offer and has secured planning consent to create three new restaurant units, which will add to the 40 existing retail units. The landlord is targeting operators within the ‘Premium Casual Dining’ sector, to enhance both the daytime and evening offer within the scheme (Bill's already occupies space in the centre) and town.

Starting from the opposing position, The Brewery Quarter in Cheltenham is a well-established and strong performing 200,000 sq ft leisure destination that is in the process of being enhanced by a new 110,000 sq ft retail extension. The new development fronts Cheltenham’s High Street and will function as a valuable link to the established leisure provision and, critically, will also boost footfall and daytime trading for existing catering occupiers within The Brewery Quarter. 

The decision on which retailer to introduce to a leisure scheme or vice versa is an important one. Do landlords take more of a risk on a new leisure trend or quirky independent retailer in order to stand out from the crowd and attract a more diverse customer base? Or do they opt for a more established brand that has a longer track record? A sustainable core income from the existing occupiers will allow a landlord more freedom when signing a new name, however, the ultimate question should be how compatible is a proposed occupier with the overall scheme and will it drive performance?

Further information

Contact Savills Retail