ADG group at MAPIC 2018: neighbourhood centres to occupy vacant niche on local market

NOVEMBER 21, 2018

MAPIC 2018, the 24th international retail real estate exhibition was held last week in Cannes, gathering more than 8,500 delegates and 2,000 retailers. One of the few Russian companies to take part in panel sessions was ADG group, which is implementing a largest retail project in Moscow — a network of neighbourhood centres. The first neighbourhood centre, Angara, will open in spring next year and, at a session devoted to Russia, the developer shared its forecast for annual turnover at the network's flagship centre.
At MAPIC 2018, property owners and retailers discussed that, in order to survive, traditional shopping centres will have to become public spaces that combine shopping and entertainment and attract families with children. Despite the diversity of entertainment formats appearing on the market, cinemas remain a favourite form of leisure, accounting for 20% of the total number of customers, according to Christophe Cuvillier, CEO, Unibail-Rodamco-Westfield. At ADG group's neighbourhood centres, cinemas will be an important part of the offering, especially in terms of the shortage of high-quality shopping and leisure options in Moscow districts.

At the Russian session on "How to Grow During On-demand Boom in Russian Retail?", Grigory Pecherskiy, Managing Partner, ADG group, presented to the participants the typical hyperlocal Moscow market for goods and services based on the example of the catchment area of the first neighbourhood centre, Angara, which will open in spring 2019 on Chongarsky Boulevard.
  • Grigory Pecherskiy
    Managing Partner, ADG group
    "Today, the area around Angara is filled with randomly scattered low-quality retail objects. There are hardly any restaurants or other quality entertainment options. Nevertheless, last year 7.2 billion rubles were spent in this area on goods, essential services and entertainment. The amount that the same people spent in other parts of Moscow on similar categories turned out to be many times more — 33 billion rubles. Creating a new high-quality leisure offering at Angara will increase the volume spent at this location, according to the most pessimistic forecasts, by another 400 million rubles. As such, our market share will be 36%, which could essentially be called a hyperlocal monopoly, and the annual turnover of Angara will be 2.7 billion rubles".
Hyperlocality was one of the important trends that was actively discussed during MAPIC 2018. According to Vivian Braun, WW Marketing Manager, IBM, companies need to take into account all local trends — from weather to local holidays — and analyse not just the demographics of local residents to offer the most relevant products for each specific area.
  • Vivian Braun
    WW Marketing Manager, IBM
    "Each store should be unique in terms of understanding the potential of the area. You must be sure that the product you intend to offer will be in demand and appreciated by the local audience. As such, you first need to make sure that in the selected location there is demand for your offering."
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