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Retail Income Strategy in Rail Making Unique Places Extraordinary

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Consumer Focus

o

Navigate

Find

Decide àFacilitate the shopper journey

àTailor the range to shopper needs

àSimplify the buying process

Traffic in itself never buys anything, it is traffic investing time that becomes shopping.

H.Sorensen

Macro space & assortment:

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Retail Landscape Competition

Financial performance Trading patterns

Consumer Profile & Needs

Combined Approach

Station Strategy:

àmacro space split by super-category

àspace allocation by category

àlogical adjacencies

àbrand selection

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Base Rent + Turnover % lever

method

Strategic

↓CAPEX None

Station Strategy

Tenant Mix Revision

Performance Improvement

cost ↑CAPEX

Income Drivers

Space

Brand

Sales

Multi-unit Single-unit

Turnover %

Operational

Landlord’s perspective •  Space—redevelopment of property asset, creation of new retail units: new space, new brand Brand—swapping out of under-performing tenants for stronger alternatives: same space, new brand Sales—driving turnover increase in specific units through operational improvement: same space, same brand Consumer focus permeates all three income avenues. •  Brand route is the most profitable for the Landlord. The size of the opportunity is impressive—Liverpool St generates £16m in income on just 20%

participation rate. The consumer is there 129m times a year. The challenge is to put forward the right retail offeràStation Strategy

•  Limitations: operational constraints, time-frames, restrictive covenants such as protected leases

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Manchester Piccadilly

Ground Floor Balcony

Casual Dining

Pub

Bar

+14% Income Tenant Mix Revision

•  Manchester Piccadilly station--second most affluent station

across the estate, 40m annual footfall, 42% participation rate, 80% ABC1, long dwell, infrequent visits, predominantly leisure, no strong competition in immediate vicinity.

•  Key aspects: ensure the brand selection matches consumer

profile & needs, maintain clear zoningàDining/Retail/Grab’n’Go, “sign-post” locations.

•  Six initiatives—Hotel Chocolat, Accessorize, Sainsbury’s, Natwest, Oliver Bonas and James Martin’s Kitchen.

•  Tenant mix revision with little Landlord capital outlay set to deliver incremental £677k in annual station income.

•  Importance of consumer focus in tenant mix planning.