Despite the negative impact of the recession and the economic constraints experienced by consumers, confidence in the retail sector remains positive, reports Johan Engelbrecht, retail management director for JHI.

"We are currently seeing a total capital investment of over R500m in expansion projects in shopping centres under our management.

He says while the recent festive season revealed a marginal increase in foot count and a reduction in discretionary spend on luxury goods, value retailers weathered the storm better than most, while fast food turnover was up, as well as clothing, textiles and shoes, and supermarkets achieved a fair performance over the previous year.

Engelbrecht says along with concern regarding Eskom's announced tariff hikes a key focus is on utilities management in order to contain costs wherever possible. "We are applying diligent processes and controls in order to curb costs. The hotly-debated Eskom tariff increases are a major concern for landlords and tenants alike. The latter may be compelled to close their doors due to increased operating costs. As a result, it is imperative for landlords to look at implementing measures to increase cost-effectiveness.

"On a positive note we are currently investigating the possible introduction of solar-powered advertising boards as well as solar-powered lighting – such as in parking areas – in some of the major centres managed by JHI. We are also endeavouring to introduce the more energy efficient LED lighting throughout our centres, as well as water-saving measures and the greening of tenant installations. However, in general, there's a tendency among South Africans to still concentrate on lower cost options which are not always the greenest."

Another trend noted by JHI is that shopping centre managers are paying increasing attention to improving security measures.

"For some time we have made this a priority in terms of the centres we manage and apart from the usual hi-tech equipment such as CCTV, security guards etc. we extend this even further in terms of security vehicle patrols outside centre perimeters, for example. While media reports of a spate of mall robberies in various regions of the country over the past year have focused increased attention on security, this can only be successful if shopping centre employees and all service suppliers, most importantly the security company employees, work closely together on all the preventative measures."

Source: Cape Business News

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