The Team Approach to Asset Management. DAY 1 Christian Olofsson

Transcription

1 The Team Approach to Asset Management DAY 1 Christian Olofsson

2 Agenda: 1)Introduction & Background 2)Asset management 3)Teamwork 4)Value creation Disclaimer: Items covered in this presentation are general ways-of-working for the Shopping Center Industry and as per ICSC s documented best practices.

3 What is asset management An approach that uses all of a shopping centers strengths, both tangible and intangible, in order to achieve the landlords stated objectives. ICSC definition.

4 Objectives of this session: Create understanding for the need of a asset strategy. Stress the importance of communicating the plan to everyone in your team. Maximize performance and value through teamwork and motivated teams.

5 Activity #1 Fill in the form with describing words, without thinking too much

6 Why shopping centres?

7 Trajan s Market Place, Rome Italy

8 Eastern Bazaars

9 Floating markets

10 Arcades and shopping streets, Europe

11 Shopping Centre definition A group of retailers, restaurants and other commercial establishments that are planned, developed, owned and managed as one single property. ICSC definition.

12 How do we define a successful shopping centre?

13 Success definition A successful shopping center is one that is positioned correctly to provide maximum shopping convenience to its target customers and maximum shopping exposure of the tenants, thus meeting and fulfilling the needs of the trade area intended to be served. ICSC definition.

14 What the tenant wants: A structured environment that drives retail! Who is our customer? The visitor is the tool we use to satisfy our number one customer - tenants! What the visitor wants: Affordable products that meets needs while exceeding expectations! What the owner wants: Exceed expectations while achieving the highest integrity standards.

15 What tenants want: Healthy occupancy cost ratio - Value for what they pay. Partnership. Successful marketing campaigns that drives spending. High awareness and loyalty. Vibrant and exciting tenant & merchandise mix. Well maintained & functioning centre. Efficient services.

16 Landlord tenant relations: Trust Approachability Feedback Flexibility Action Performance Indicators

17 Do you dare to perform anonymous Tenant Satisfaction surveys?

18 Retail Real Estate

19 Retail Real Estate Consumer Shopping Center Commerce Retailer We all speak the Language of Retail: Product Price Convenience Service Experience

20 Retail Real Estate Investment Macro Economy Government policy Consumer purchase power Investment Return Market Opportunity Capital Commitment Cost of capital Risk Capital Investment benchmarks Rate of return on Capital Operational Management Strategy Tactics Risk Mitigation

21 Retail Real Estate The value proposition Location Location Location Market access Commercial Concept Leasing Plan Selling the project Ongoing Leasing Stores Demand Traffic Shopping Center Value Shopping Center Earnings Rents Sales THE SHOPPING CENTER INDUSTRY AND ITS FINANCIAL PARTNERS Retailer Earnings Retailer Stock Price Retailer Market Capitalization THE RETAIL INDUSTRY

22 Asset Management

23 What is Asset Management The following items identifies Real Estate Asset Management: A. Analysis of Market Potential. B. Conceptualize the ideal Asset solution. C. Establish a Strategic Asset Plan. D. Management of the Strategic Asset plan. E. Communication, Reporting and Performance Measurement. F. Hold/Sell analysis

24 Someone is the lead singer someone is carrying the drums...

25 Long term Business Plan Budget Action Plan Property Plan Leasing Strategy Sales strategy Marketing Strategy People Strategy Customer Journey Tools & Support documents Tools & Support documents Tools & Support documents Tools & Support documents Tools & Support documents Tools & Support documents

26 How can value grow? Our main task is to increase the value of our shopping centre.

27 How can value grow? To be aware & plan for: Creating Value FFO (Funds From Operations) or NOI (Net Operating Income) Growth Definitions & Policies Strategy of Growth Sales Productivity Occupancy/Rent Increases

28 How can value grow? To be aware & plan for: Owner s Goals Ability to React Quickly Individual Property Situations Effect of Current Market Trends

29 What is your unique selling point?

30 The following items are important for a assets value: a) cash flow (Net operating income - NOI) b) footfall (amount of visitors) c) Sales and revenue d) Location, location, location e) Consumer awareness and popularity f) Tenants operating in the centre g) Competition on the local market h) Conditions of the building i) Technical equipment j) Infrastructure k) Environmental impact

31 Important for asset value: a) cash flow (Net operating income - NOI) b) footfall (amount of visitors) c) Sales and revenue d) Location, location, location e) Consumer awareness and popularity f) Tenants operating in the centre g) Competition on the local market h) Conditions of the building i) Technical equipment j) Infrastructure k) Environmental impact

32 Team work

33 Marketing Leasing Tenant Coordination Operations Business Development Construction / Project Management Shopping Centre Manager Administration Finance Human Resources Accounting Legal

34 Build high Performance Teams: Successful teamwork = Value Creation

35 TEAM Customers drives sales Sales drives rents Rents drives income Income drives value

36 ZION SHOPPING CENTER Experiment Case Study

37 ZION Shopping centre Experiement Case Study: Summary: Read more details about the centre and your role in the handout. Groups of 6 members; each member plays a defined role. 30 minutes group-work to agree on proposed direction and actions. 5 min presentation from each group; using the ZION layout + flip chart. Task: High-level asset plan for the Board of Directors. Purpose is to get their support and endorsement before a more detailed plan is developed.

38 Summary of course one

39 The centre management team: Our main task is to increase the value of the shopping centre.

40 Use a team approach to enhance your mall operating performance. Put strategies in place, monitor & modify as/when needed. Establish processes that initiate and drives change. Invest in employees, to build high performing teams. Utilize the knowledge & competence within your team. Understand your customers! Dare to be different! Challenge the conventional! Envision going beyond! Be flexible and adaptable!

41 The centre management team: Tenants want a structured and consistent environment that drives retail! Visitors - Know, understand, utilize your knowledge. Today and tomorrow Exceed expectations on a personal level Successful teamwork = Value Creation

42 THANK YOU ICSC EUROPEAN RETAIL PROPERTY ACADEMY AMSTERDAM 2018

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