The critical success factors in achieving our investment objective and implementing our investment strategy are active asset management, customer service, strategic relationship management and collaboration with proptech start- en scale ups.
Active asset management
The occupancy rate for the Fund’s assets is highly dependent on how we carry out our asset management. It involves a strong focus on the leasing of our assets and finding the right balance of retailers in each individual location.
It is often necessary to have a different leasing strategy for each individual retail asset to achieve an optimal occupancy rate. In most locations, but especially in district shopping centres, it is vital to achieve the right mix of complementary tenants to ensure the long-term success of a centre. The Fund generally tends to go a lot further than the regular leasing activities with its external property manager and retail estate agents. This may involve asset management on location or strategic tie-ups with real estate owners in the vicinity.
In addition to the leasing, it is also important to have a clear picture of the future-proofing of our tenants. The chance of long-term vacancy after the bankruptcy or departure of a retailer is increasing due to the changing retail landscape. The Fund recently redeveloped a ‘Tenant risk assessment’ for the top 10 major tenants in the portfolio. This assessment looks at financial resilience, consumer appreciation, and the investment and innovation potential of the tenant.
In the coming period, we will expand the use of this assessment to the other tenants in the portfolio. We are also aiming to improve the assessment by maximising the use of objective criteria from new data sources and by adding the criterion: Brand store or not. Brand stores are retailers with their own product chain, such as Rituals, Under Armour or Primark. They innovate more in product development and store experience and the stores often have a remit that goes beyond generating a profit, as they are also used as a marketing tool, making them more future-proof than other retailers. Increased focus on brand stores in the portfolio will therefore also reduce the Fund's tenant risk.
Tenant risk assessment
One trend set to continue for the foreseeable future is that people are demanding ever-increasing levels of service. These trends and developments are now also being felt in the real estate market. Our tenants expect more from us and our stores and shopping centres on a number of fronts, including quality, sustainability and outstanding customer service. We have made the satisfaction of our tenants a major priority for the coming years, as an integral part of our wider ambition: to be more client-centric in our approach to all our stakeholders. What it means in effect is that we will be using the wishes of our tenants as a touchstone to improve the quality and efficiency of our processes, to optimise our contacts with tenants and to take a more proactive approach to how we provide our services.
Strategic Relationship Management
The Fund actively works to improve its reputation among a comprehensive network of vendors, real estate developers, real estate agents, the Dutch national government, local municipalities and corporations. To this end, we maintain professional relationship management in order to find appropriate investments, to share and gain knowledge and to exert influence. On some occasions, we partner up with lobby groups, network organisations and sector associations, such as IVBN, NEPROM, ULI and Platform31.
Stakeholders in the retail real estate market are keen to work with trustworthy partners that accept their social responsibility. Partners that want to create future-proof, inclusive and liveable cities. This is why the Fund focuses on being a partner to its stakeholders, and tries to build reciprocal understanding between municipalities and institutional investors.