Pop-ups: an opportunity for landlords to solve the issue of empty shops.

The Re:START mall helped revive Christchurch’s CBD after the devastation of the 2011 earthquake.

The Re:START mall helped revive Christchurch’s CBD after the devastation of the 2011 earthquake.

Commercial landlords should embrace pop-up stores if they are to weather changing shopping habits and prevent valuable spaces from lying vacant, a real estate agent says.

Pop-up stores – the temporary conversion of an empty space into anything from a commercial outlet to an art gallery – have surged in popularity in recent years, and have become a permanent part of the retail landscape in major shopping centres in the US and Europe.

They have yet to cement themselves fully in the New Zealand market, but key players in the retail market have acknowledged their move into the mainstream.

The Molenberg pop-up shop was open for a limited time this year, serving toasties and fresh sandwiches.

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The Molenberg pop-up shop was open for a limited time this year, serving toasties and fresh sandwiches.

Retailers and landlords who previously ignored or dismissed them as marketing events or as cheap discount stores, or perhaps because they lacked the know-how to try them, are now seeing their worth as an opportunity to reach out to new customers.

Bayleys national commercial director John Church said the rise of pop-ups was partly due to the fact that they provide a “neat solution to a persistent problem: empty shops”.

The Pressed Raw Juice Bar was a juicy pop-up store in central Auckland.

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The Pressed Raw Juice Bar was a juicy pop-up store in central Auckland.

“The temporary nature of pop-ups means the risk is low for all parties involved.

“Retailers can take a gamble on a new location or new product, and dare to be creative – pop-ups are equivalent of taking a car out of a test drive – while landlords can fill their spaces more quickly, and expand their client base.”

Through the power of the pop-up, previously underutilised sites could be “transformed into vibrant commercial hubs”, Church said.

Pop UP Now founder Lizzi Hines says the longer you take to erect a pop up, the more money you're wasting.

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Pop UP Now founder Lizzi Hines says the longer you take to erect a pop up, the more money you’re wasting.

“Using pop-ups can help entrepreneurs stay nimble and lean – they do not need to sign long leases, stash away much cash or carry big credit lines.

“For their part, consumers can meet the designers and touch and feel their works, which cannot be done online,” he said.

“In the process, brands can be built more quickly, sales can be increased and new products can be tested.”

For commercial landlords who had long relied on the attractiveness of their conveniently-placed retail spaces, pop-ups were something to “fall back on” when more shoppers preferred to make their purchases from their couches, Church said.

Greg Harford, of Retail NZ, said pop-ups would become an increasing phenomenon in New Zealand because they were not only popular with consumers, but they were an opportunity for retailers.

“Retail is constantly reinventing itself – new stores are coming in and old businesses are closing down.

“Pop-ups are part of the mix even though they represent a relatively small slice of the retail pie,” he said.

“Commercial landlords are always going to prefer a high-end retailer on a lengthy lease but pop-ups are an opportunity for them to fill the gap between permanent tenants.”

In Christchurch, a pop-up mall was a colourful beacon of hope for a city trying to find a way through the pain of the devastating earthquake of February 22, 2011.

Pop UP Now founder Lizzi Hines, said for many people not in the real estate business, the notion that landlords could leave empty retail space for years was “mind-boggling”.

Landlords and leasing agents in New Zealand had yet to fully realise the benefits pop-ups, she said.

“We’re definitely trying to educate landlords and agents on how important it is to activate a space,” she said.

“A lot of retailers, particularly if they are first time-retailers, don’t know what a space is going to look like unless they see someone in there first,” Hines said.

“Seeing an active space can be an incentive to signing a long-term lease.”

For landlords, it made them “a bit of coin” in the meantime, she said.

“You’ve got to get all parties to buy into idea and we have had situations where we have found a great site but we can’t get the landlord on board.

“They’re argument is, ‘I don’t want to fill my space with a three-month pop-up, because that potentially could stop me from getting someone to sign a six-year lease,’ Hines said.

“But landlords are starting to become more open to it because they’re starting to see more examples of it.”

How a pop-up pops up

What’s the key to successful pop-up? It’s got to look good, it’s got to feel good and it’s got to be a really good retail experience, Hines says.

“You don’t want something that’s just been thrown together with excess furniture from someone’s house, but equally you don’t want something that is hard to take apart – you need to be able to pop it up somewhere else.”

A pop-up could happen quite quickly, she said.

“We did a pop-up for a large juice manufacturer that wanted to test a new product but didn’t want anybody to know the brand behind it.

“It took, from start to finish, about six weeks – that included design, conception, installation, drawings, everything.

“And then we did a pop-up for Molenberg, which wanted to get people excited about bread – that took about three months because there were quite a lot of major stakeholders involved.”

In both instances, the retail space on offer was much bigger than they wanted, so they negotiated with the landlord to take the front 30 metres and put up a wall behind it.

“Because we were activating the space, we convinced the landlord to only pay for the 30 metres we used.”

A pop-up could be an intensive and stressful experience for a retailer or landlord – especially if it was their first time, Hines said.

“The longer you take to erect a pop up, the more money you’re wasting.

“You’re literally playing with their money and you’re playing with their time, so you’ve got to make sure they feel confident that you can deliver on programme and on budget.”

They treated the landlord as if they were signing on as a long-term tenant, she said.

“We show them what the concept is going to be and what we are going to do to the space.”

Originally from stuff co.nz

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