Title: Explaining the high cost of retail space in Ghana
Dated: 9-9-2014
Broll Ghana says, one key challenge in the retail sector in Ghana, is expensive rent, which could be attributable to the high cost of building and maintaining modern Retail Facilities to international standards.
Understandably rents being charged for shopping centres are higher than what pertains in street corners but the reason is that marketing expenses and maintenance of these facilities is particularly high. Additionally, high traffic areas also attract a higher premium.
Broll Ghana markets shopping centre space to various businesses and performs due diligence on prospective retail tenants.
Mr. Moses Luri, Head of the Retail Leasing Division said in an interview that the retail sector is also facing some challenges, which include an increase in Value Added Tax, Clearing challenges at the ports authority, and the high cost of shipping goods to Ghana.
Some of the international retailers already in the market include TM Lewin, Swatch, Levis, Puma, Bata, Shoprite and Game.
Other big name retailers expected to venture into Ghana are Mango, Sunglas Hut, Lufian, Edgers, and Hugo Boss. Currently Carefour, WHSmith, Debenhams, Polo, Aldo and Guess are also actively exploring expansion into Ghana.
According to Mr. Luri, Ghana’s Retail Sector has come a long way from the previous dominance of the informal retail sector where shoppers’ only choice was to go down to the local markets for all their shopping needs. Now, various shops are springing up in neighborhoods where one could purchase convenient items. As the growth continues, larger supermarkets that provide parking, air-conditioned shopping spaces and a wider variety of goods are becoming more prevalent.
“There are several shopping centres planned for different parts of the cities of Accra, Tema, Kumasi and Takoradi. Some of the reasons that account for the increase in shopping centre investments are: demand from shoppers looking for convenience and true variety under one roof; the seemingly growing disposable income of the sophisticated middle-income group shoppers; and the push by international retailers to bring their brands closer to emerging markets like Ghana,” he said.
Mr. Luri noted: “the concept of Property/Retail Management is relatively new in Ghana. We have been at the forefront of educating property owners on the importance of outsourcing the management and maintenance of their properties, while the various developers and/ or owners concentrate on what they do best or on their core business – developing choice properties”.
Mr. Luri said because most investors are foreigners, they are exposed to the concept of property management and so they come into the market looking to build relationships with existing providers such as Broll Ghana to help them deliver a complete product.
He stated that understanding a particular geographical area and the social and lifestyle preferences of the inhabitants involves a careful evaluation of specific shopping centre designs and making a determination about how best to strategically locate supermarkets, food courts, banks and fashion retailers in the layout and design.
Other considerations include deciding on which stores should be positioned as anchors that will help attract customers to the facility. Anchor stores are the most recognized brand retailers and are usually strategically positioned at the ends of the shopping center to attract people; they act as the pillars of the facility.
He said there is the need to profile potential retailers that would be best for the specific shopping centre being marketed. Also, it is important to consider the prospects a particular shopping centre will offer to various retailers and provide assistance to interested retailers to complete the various administrative requirements of the various developers.
Mr. Kofi Ampong, Broll Ghana’s Chief Executive Officer, said “when it comes to Retail management, Broll Ghana aims to ensure proper tenant mix so that most tenants will have some semblance of monopoly. This calls for proper market research studies to give a clear indication of which direction to take when marketing a centre.”
“Broll Ghana also helps to come up with marketing strategies which will cover Situational Analysis, SWOT Analysis, Tenant Analysis, marketing promotion plans, tenant matrix of opposition centres”.
Mr. Ampong added, “Broll Ghana’s philosophy is to maximize the value of a Shopping Centre by ensuring that it offers the best Shopping and entertainment experience thereby attracting the most purchasing power from the target market it serves.”
Mr. Luri said rentals of Retail facilities are primarily determined by the various developers or investors and Broll Ghana provides relevant market intelligence to help their decision making. “Rentals are on the ascendancy. The general trend shows rental activity escalating by an average of 5% on an annual basis”.
Broll Ghana was involved in the leasing of top-rated retail and office space in locations like Movenpick Hotel, the office component of the new Stanbic Heights. Broll was also actively involved in providing varying real estate services to some upcoming developments like West Hills Mall, Achimota Mall, The Junction Mall, Meridian Mall, The Exchange and Accra Waterfront, in and outside Accra.
In addition to Retail Brokerage and Property Management, the Company provides Valuations/Advisory Services, Residential Brokerage and Management, Facilities Management, and Corporate Real-Estate Services.
Broll Ghana’s clientele list includes but is not limited to – Atterbury/Sanlam (Accra Mall Limited, West Hills Mall Ltd), RMB Westport, Social Security and National Insurance Trust, SIC Insurance Company, Hollywood Developers, Primrose Homeowners Association, Hawkrad Construction, Polocourt Homeowners Association, Amerigan Resources, Ghana Heights, Ecobank and Check Point.
The company directly employs more than 70 people and indirectly employs several hundred through the various service providers. Broll Ghana also embarks on several social intervention programmes.
Broll Ghana for the past 4 years has been adjudged the best property/facilities management company and recently was awarded the Property Management Company at the Sixth Annual Ghana Property Awards ceremony held in November, 2013.
The annual award recognizes excellence in the property industry and is targeted at real estate companies, financial institutions, regulatory authorities, professional institutions and the public.
Broll Ghana is part of the CBRE Affiliate Network and its systems and procedures are benchmarked against the ISO9001:2008 standard – an internationally recognized and respected standard by all investors.
Source: http://brollghana.com/
Dated: 9-9-2014
Broll Ghana says, one key challenge in the retail sector in Ghana, is expensive rent, which could be attributable to the high cost of building and maintaining modern Retail Facilities to international standards.
Understandably rents being charged for shopping centres are higher than what pertains in street corners but the reason is that marketing expenses and maintenance of these facilities is particularly high. Additionally, high traffic areas also attract a higher premium.
Broll Ghana markets shopping centre space to various businesses and performs due diligence on prospective retail tenants.
Mr. Moses Luri, Head of the Retail Leasing Division said in an interview that the retail sector is also facing some challenges, which include an increase in Value Added Tax, Clearing challenges at the ports authority, and the high cost of shipping goods to Ghana.
Some of the international retailers already in the market include TM Lewin, Swatch, Levis, Puma, Bata, Shoprite and Game.
Other big name retailers expected to venture into Ghana are Mango, Sunglas Hut, Lufian, Edgers, and Hugo Boss. Currently Carefour, WHSmith, Debenhams, Polo, Aldo and Guess are also actively exploring expansion into Ghana.
According to Mr. Luri, Ghana’s Retail Sector has come a long way from the previous dominance of the informal retail sector where shoppers’ only choice was to go down to the local markets for all their shopping needs. Now, various shops are springing up in neighborhoods where one could purchase convenient items. As the growth continues, larger supermarkets that provide parking, air-conditioned shopping spaces and a wider variety of goods are becoming more prevalent.
“There are several shopping centres planned for different parts of the cities of Accra, Tema, Kumasi and Takoradi. Some of the reasons that account for the increase in shopping centre investments are: demand from shoppers looking for convenience and true variety under one roof; the seemingly growing disposable income of the sophisticated middle-income group shoppers; and the push by international retailers to bring their brands closer to emerging markets like Ghana,” he said.
Mr. Luri noted: “the concept of Property/Retail Management is relatively new in Ghana. We have been at the forefront of educating property owners on the importance of outsourcing the management and maintenance of their properties, while the various developers and/ or owners concentrate on what they do best or on their core business – developing choice properties”.
Mr. Luri said because most investors are foreigners, they are exposed to the concept of property management and so they come into the market looking to build relationships with existing providers such as Broll Ghana to help them deliver a complete product.
He stated that understanding a particular geographical area and the social and lifestyle preferences of the inhabitants involves a careful evaluation of specific shopping centre designs and making a determination about how best to strategically locate supermarkets, food courts, banks and fashion retailers in the layout and design.
Other considerations include deciding on which stores should be positioned as anchors that will help attract customers to the facility. Anchor stores are the most recognized brand retailers and are usually strategically positioned at the ends of the shopping center to attract people; they act as the pillars of the facility.
He said there is the need to profile potential retailers that would be best for the specific shopping centre being marketed. Also, it is important to consider the prospects a particular shopping centre will offer to various retailers and provide assistance to interested retailers to complete the various administrative requirements of the various developers.
Mr. Kofi Ampong, Broll Ghana’s Chief Executive Officer, said “when it comes to Retail management, Broll Ghana aims to ensure proper tenant mix so that most tenants will have some semblance of monopoly. This calls for proper market research studies to give a clear indication of which direction to take when marketing a centre.”
“Broll Ghana also helps to come up with marketing strategies which will cover Situational Analysis, SWOT Analysis, Tenant Analysis, marketing promotion plans, tenant matrix of opposition centres”.
Mr. Ampong added, “Broll Ghana’s philosophy is to maximize the value of a Shopping Centre by ensuring that it offers the best Shopping and entertainment experience thereby attracting the most purchasing power from the target market it serves.”
Mr. Luri said rentals of Retail facilities are primarily determined by the various developers or investors and Broll Ghana provides relevant market intelligence to help their decision making. “Rentals are on the ascendancy. The general trend shows rental activity escalating by an average of 5% on an annual basis”.
Broll Ghana was involved in the leasing of top-rated retail and office space in locations like Movenpick Hotel, the office component of the new Stanbic Heights. Broll was also actively involved in providing varying real estate services to some upcoming developments like West Hills Mall, Achimota Mall, The Junction Mall, Meridian Mall, The Exchange and Accra Waterfront, in and outside Accra.
In addition to Retail Brokerage and Property Management, the Company provides Valuations/Advisory Services, Residential Brokerage and Management, Facilities Management, and Corporate Real-Estate Services.
Broll Ghana’s clientele list includes but is not limited to – Atterbury/Sanlam (Accra Mall Limited, West Hills Mall Ltd), RMB Westport, Social Security and National Insurance Trust, SIC Insurance Company, Hollywood Developers, Primrose Homeowners Association, Hawkrad Construction, Polocourt Homeowners Association, Amerigan Resources, Ghana Heights, Ecobank and Check Point.
The company directly employs more than 70 people and indirectly employs several hundred through the various service providers. Broll Ghana also embarks on several social intervention programmes.
Broll Ghana for the past 4 years has been adjudged the best property/facilities management company and recently was awarded the Property Management Company at the Sixth Annual Ghana Property Awards ceremony held in November, 2013.
The annual award recognizes excellence in the property industry and is targeted at real estate companies, financial institutions, regulatory authorities, professional institutions and the public.
Broll Ghana is part of the CBRE Affiliate Network and its systems and procedures are benchmarked against the ISO9001:2008 standard – an internationally recognized and respected standard by all investors.
Source: http://brollghana.com/
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