The secret recipe for Office Retail Complexes

We have in the recent past discussed and analysed the concept of Office Retail Complexes (Read: The era of office-retail complexes: a tale of three cities). The concept has shown some remarkable results in the recent past, not just from a rental perspective but as a great value add to the entire commercial development in totality.

So, while we have seen that ORCs provide a host of benefits to both owners and occupiers alike, they also offer a great environment largely driving consumption with a huge emphasis on convenience. This aspect makes the ORC an extremely viable and progressive model for developers to emulate.

So what does one consider while developing/planning ORCs? Are they all the same? What should the developers/planners consider before planning the ORCs?

Detailed assessment of the occupiers and the catchment is a crucial part of planning the ORC:  Who would be occupying the maximum space in the development, how many people would the working out the development, what kind of companies (IT, Financial Services, BPOs, or Industrial) and the average salaries.

The above assessment would help understand the volume of business which could be expected. You do not really want to have multiple offerings of the same category when the expected footfall is low. Understanding what would work is important - expensive outlets for average income audiences would prove to be a disaster as people working in and around the park would not really be the right consumers, typically if you have BPOs or startups as major tenants then the crowd is usually younger and has higher disposal income. They work in late shifts so planning 24 hours outlets would make sense. Value-adds like a creche for working mothers, a mini health clinic, and grocery would be viable in case the campus is big and the tenant mix is correct.

Catchment and footfall analysis is extremely critical; the design part could be defined if this analysis is done at an early stage. For example, if you are planning a big grocery store or restaurant then it would help if the same could be implemented and planned at the design stage wherein provisions for trolley loading and unloading bays in case of grocery/supermarkets could be planned for food service areas etc. This would be critical form an operations perspective.

Planning for new trends: how does one plan for the future?

Look at some larger and established cities in the world. A lot of these trends have actually been derived from successful models in many mature and markets like New York, Singapore, Hong Kong, Dubai, London etc. that have already executed similar if not the same concepts successfully.

The development has to be looked at in totality. Planning a large retail area as compared to a smaller commercial/office area may not be a viable option primarily because there would not be enough footfall to support the retail area. Having a brand in the retail area just because of higher rent paying capacity without actually fitting into the mix may not last really long primarily because the concept of the ORC is symbiotic where both the retailer and office tenant live of each other and not in isolation.

 


 

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