Voice on Demand - Retail Podcast by MECS+R (MECSC)

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Impact of COVID-19 In The Shopping Centre and Retail Industry

by The Middle East Council of Shopping Centres & Retailers
June 9th 2020
00:54:48
Description

Special Episode recorded live during the webinar series hosted by the MECS+R.

Discussion Points
► E-learning launch for the MECS+R augmenting GVS by end of April/May.
► The MECS+... More

Welcome to the Voice of Demand. Podcast Special episode of Carvin 19 recorded live during the Webinar Series hosted by the Middle East Council Shopping centers and retailers. Good morning. Again. I am Cake. Amanda, Associate director off E. C. S are on behalf off NBCs our theme. We would like to thank you for joining us on the place. NBC s our webinar. Let me welcome our moderator, the CEO of Middle East Council and Shopping Centers retailers. David McAdam. Okay, thank you very much. I appreciate it's great to see everybody's face out there. It brings me great joy to see everybody's face even on a zoom webcam. It's great. You know, Conrad, I saw Conrad is here is well, and Conrad's background, you know, thumbs up to you. You got the best background of all. If anybody could ever see it, He's riding a motorcycle very quickly. Take

some beautiful highway. Anyway, thank you all for being here. Ladies and gentlemen, I really appreciate your time today. Uh, welcome to the first of many of our webinars and other online connections with the team from the Middle East Council of Shopping Centers and retailers. We've been working from home now for the past while over three weeks and it took me personally, it took me about, I don't know, over a week to get used to the new rhythm of working from home, the whole idea of the challenges of being connected properly in the Internet. However, I can say this, but after three weeks over three weeks now we're now more productive and busy. Keep the lines of communication open with everyone. So it's It's a great way to start on this Webinar and I thank everybody for joining us, our team, just to let you know how we've been working. Our team has been doing scheduled zoom meetings together for least three times a week, and it's been many more than that. Actually, when you add them all up when you add the zoom meetings to the other phone calls with the team and the other members in

the M E CSR we've been chatting with. It's been amazing to keep in touch with everyone, and it's been also very exciting for us to understand what everybody's going through and understanding we can pass along. What we're doing is, well, how we're making it through all of this. Our priority includes the health and well being of the team, and their families are Middle East, Council of Shopping Center and retailers, members and families and the retail industry overall, and I'm sure you're much the same. We continue to reach out to all of you through our digital points, and our digital points are going to be, I think, growing and growing as you will see. Let me talk to you a little bit about what our digital points are that we can use. Our website is continually upgraded and updated, and it's always there for you. The what's up newsletter that comes out monthly with the current events. Our team is doing a great job making that a very interactive and very newsworthy newsletter. So if you've not been reading that, please jump in because it's a great way to do it. Our Retail People magazine comes out at the end of April in a digital format

, and I know that you'll see that we've done a lot of work this month in this quarter edition. Ah, lot to do with covert, of course, the covert 19 virus, but also a lot on successful family businesses, and I think you'll do get great joy and reading what we've been able to create and see some successes even in these otherwise more downturn times, you'll be, e think quite impressed with the other ways we reach out or through our voice on demand retail podcasts. When we first started out a while ago on this, we didn't know how it would go over. But I'm finding. Ian was telling me the other day that we have probably 1200 to 1300 people listening online to our podcast so clearly they're working, and I'm really appreciate all of you spending the time. First of all, the come in and doing it, you can do it online from your home. But also when we were doing it back in the office in our studio, we had so many great podcast coming out of there, and we'll continue to do that. In addition now, we recently launched a video on demand which is just one step further. The podcast, which is our own retail YouTube channel

, and we've started slowly on this, but we're going to grow that as well, and I think that there's many ways that you can participate in this is well, which I think will be very important. And, of course, the 2020 Middle East Council of Shopping Centers and Retailers Directory is coming out of the end of April Fool in digital format. So there's a lot of new updates, a lot of new things going on, and everything is digital, as I think you'll see are normal. Hard copy material has been delayed because of the fears of distribution of magazines. The directories, which some authorities say may harbor the coronavirus. So we are unable to publish hard. Copy these directories and magazines at the current time. But rest assured, as soon as we're able to put the hard copies out, we will send them to you and you'll be able to have them pick them up and get them in hard copy as well. We know of your challenges personally and professionally, and you may think that, you know, because we haven't reached out before now that perhaps you haven't understood what we have been doing and where we're at. But I can tell you that we're all in this together. We know of your challenges personally and professionally

. we see them, we hear that our team has been talking to so many different people through zoom through normal phone calls and through so many other ways, emails that it's great to keep that level of communication up. I want to say this to all of you. I say this in all of the other times that we've met and I say this. If you need something, don't hesitate to call any of the members of our team. You know who we are? My phone's on 24 7. I'm not going anywhere. I'm always inside. So if you wanna pick up your phone and call me in the mobile any time I'm always here. I'm working from home, goes with anybody in our office. We're all working from home, but we're all available to listen to you and talk to you. We all face this common crisis everything we know and have. No one has been turned upside down, and I don't think anybody is surprised by that by now. But everything is upside down from where it waas At times. We're worried about the virus, about ourselves, about our families, our own health, our family's health, our friends. How they're doing

colleagues, members and their business is how are we going to survive after this? But I will say one thing that I want you to remember And that is this Is that the event this coronavirus pandemic event will pass, and it's up to us as an industry to ensure that we can carry on. And I know that there's so many things that we continue to do in our office and with our team to keep the wheels in motion. Keep the wheels on the bus as they see and keep moving forward. A soon as you stop, you go backwards, and I think we all know that. So from wherever you are, I can suggest that it's important for you to keep on the phone. Keep reaching out to your retailers. If you're shopping center owner manager, I can only suggest that you keep reaching out to them. Talk to them, let them know where your what's going on with you. What's happening. Even if you don't have much new news to report from where you're coming from, it's always great to keep your name and face in front of these different people who are your colleagues Who are the people who make this whole industry survived? Remember this that up until February this year, there were thousands

and thousands of retailers that were open and operating and prospering. But now less than 1% of the retailers in this region I'm just speaking. This region now are open. That has significant impact everywhere. It goes without saying that it's it's really a massive industry shift. But I think, as you have been a swell, I've been reading about other things, and I know that gorillas in the industry that are online, for example, like the Amazons of the world, they've been facing so many challenges that I don't know if you've been reading about them. But the delay, the shipping challenges, the problem with your staffing. All of these issues are opening our eyes. Thio. Nothing is as perfect as what we think we saw, and I think it's important to remember. I'll go back to something that my grandfather once said to me, that was a very young boy when you said to it, and I always thought that my grandfather was the wisest man in the world. When you're 56 years old. You do. He taught me something that stuck with me for many decades, which is perhaps still relevant today. My grandfather

said this. He said, Nothing is as bad as it seems, nor as good as it seems. And I think as long as we remember all of those things that are part of what we are today in this industry, we'll get through it and it's one step at a time. So I want you to remember that. I mean, I could go on for hours about all of the other things that I've been reading and listening and other people have been talking to in the industry from Saudi through 20 man. And through this area, um E. But I think let's open it up, please. If anybody has any questions or any thoughts, this is an open forum. I would really like to have some questions from anybody if they have anything that they want to say. Hi, this is Mohammed Khatib from American Saudi Arabia. My question will be how will be the market cost covered. 19 will be there. Ah, drastic changes in the design of the most. Will it change our lifestyle in terms of the customer, customer behavior in terms of regulations or people just go back to what they've been doing before

covered 19. Well, of course, it's an opinion that you're asking for, and I can give you my opinion on this. What I've learned and what I've seen is that people are social animals. Yes, we're stuck at home. We're stuck where we can't go out. We're on curfew. We can't do the things that we've normally done. But people because of their vory nature, our social, they want to be out. They want to see other people. They want to experience things. They want to see what's going on. And they see that by not only shopping for themselves or dining with their families or doing things together as a family or individually, they do it in so many other ways. So my opinion will be that I think that this the return to normality as we talk about, we'll come back. It won't come back overnight, but it will come back in a matter of months. Once people are assured that there won't be a danger to their own health to come back and once they do start coming back and the word basically starts Thio

. Get out that it's fine. Come on, let's see. Meet people and joining, Even if their social distancing, I think that people will still come back. But let's get other people's opinion, too, because that's just my opinion. What does anybody else have to say about that? Please come forward. Make your opinion known. David. Hello. I fully agree with you. We've had a major locked down here since quite some time. Andi, I could go with you on everything you have stated. In your opinion, Um, the only thing that we are facing over here, our tenants who are now wanting relaxation on their tariff on what they pay every month apart from obviously there's gonna be a very a revision camp Rentals are being slashed. Do you think that going ahead with the three month and four months the waiver is going to be a solution for all this or because now the world market prices going to go down? People are not willing to pay that kind of money for what they were paying, especially the new and upcoming

malls, which I'm working on. So this becomes a big challenge for us to convince the tenants who have gone through a major loss period, and their recovery is still questionable when we're talking to the same tenants who got shops in existing malls and you want to go for expansion into new malls. How does one really address this situation when we want to tell them that? Okay, when our landlord is wanting X and attendance, not wanting to pay that finish? Thanks. I appreciate your thoughts on this very much. Tell you what I've learned after 38 years in the industry. What I've learned is this is that when people are making sales, the retailers can afford to pay rent when they're not making sales. It's very difficult for them to pay rent of any kind. I think that that's fairly clear. My opinion is, is that things were going to pick up, and in the next 3 to 6 months after things come back, they will be back at a very high level. And once that happens, I think that people will be more attuned to coming back to the market than jumping in. If you're a retailer and you wanna

be in the retail business and the shopping centers air there, and they're successful by every measure. You will be successful when you bring those retailers, and that's my opinion. Now, how do we get? How do you bridge the gap between where we are today and say, six months after opening? That's the trick shot. That's the relationship part of the business, which I believe this whole industry is based upon relationship. And my sense is, is that as long as you have solid relationships with these people, I'm talking about personal and business relationships. These people, I think you'll have a good opportunity to carry on and do business with others the way you were doing it before, in fact, even more. But that's once again. That's my experience. And that's what I've seen in the past. Okay, Thank you, David. Good morning. This is what you heard from Jeddah. Saudi Arabia. And radio would like to hear your opinion. We know this is all gonna pass, but how can we leverage on the change off the habit off the people off the habit off time. Now we know many people now being forced to use the electronic service

and buying online, so this will change the habit. I'm not saying this is online versus offline, but how can we as an industry leverage on this change? Well, great question. Well, and thank you for for asking it. Here's my opinion on that. My senses is that people are going to revert to the way they were before all of this pandemic came down on him. And that is, is that people are going to be a lot more social, and there's probably going to be an overreaction to being more social a soon as they feel they're going to be saved. My sense of it is, is that the challenges that people have had buying online recently, I think, have created some doubt in their minds that this is perhaps the best way forward. I go back to the whole thing about relationships, and if you're retailers have solid relationships with what with their customer base and who they are, they could provide products and services that are important for everyone, added a reasonable price and offer delivery. If that's what it takes that I think that they'll be back there. My sense

is is that there won't be this wholesale change that people are talking. My feeling is is that the retail environments? And I'm talking this region now. I'm not talking North America or Western Europe. I'm talking about here given the climate, the conditions given the hot summers. Given the lack of places for people to go and hang out and given the opportunity for people to do things, I believe it will come back to the shopping centers. And I believe it will come back in a fairly strong way. The question is when. Hi, David, how are you? This is not Valbusa. Hi to everyone came here. I have a question. Do we do we have any insight from our colleagues in China about rebound that they're experiencing now that this is obviously the first country that was able to re open after covet? And if not, could we have access to this information? Because this could be an interesting benchmark or a case study to review? Sure. That's a great question that, uh, let me explain what I know from reading. And what I've read is is that

when the lock down and the curfews and people were allowed to come back onto the streets. They came back in a big way, and they came back in a big way for everything that they were doing in their life, including shopping. So I would suggest that whence the curfew is released and where we're living and people deem it safe to be out on the street and commingling even if there is a social distancing that they're taking advantage of, I suggest that there will be a lot more shopping going on one on one with using cash or other forms. Now, I will make a point of going and asking some of the people that I have as contacts in China. Find out exactly your question. From what I've learned and Red, I would suggest that retail industry has picked up as soon as people were allowed to come out of their homes. This is it. Only from Beirut. Roni. How are you? Good. How are you? Thank you for organizing. This is anyone trying to reach out to you on a government level, local or divisional level. See what kind of you found that

could be organized in order to support this industry and to relaunch the industry. Have to this crisis because, you know, as you know, on a private level, the more developers level they may not be able to sustain all these laws. You know, I can't speak for every country. I've read a few things, particularly about Lebanon, which which is not necessarily great news with respect to the debt that they have, but other countries and I could say the u. A e have already come out with a number of different initiatives that they say are ready to deploy to assist the industry to keep its wheels turning. Now, having said that, when and how, and the way this whole thing will roll out, I think is going to be part of a learning that we will see. I can assure you, the team and myself are going to be all over this to be able to share that knowledge with you. As an industry, you're able to at least follow along and do what you can do wherever you are. So I hope that answers, and we'll be the social conduit to be helpful for you on

that. We've had some other shopping center management teams. Ah, hold of us for similar questions to that from the U. A. E. And we've been able to direct them in the right way. However, I just want to reiterate what I said to them, and I'll say it is well to everyone here. We're happy to help. We do not carry a big stick. We can create white papers for the industry and we can deliver them to the right source. But that doesn't necessarily mean they're gonna listen to us as an industry or me personally about it. They may take the comment and they may think about it, but it doesn't necessarily mean that this is what they're going to have done. Hi, David. Had everybody fine, fine here. Thank you for this opportunity where it's nice to see everybody here, but we need to hear more from the retailer. What they are expecting from the malls, managers off honors, most off the people here. It's from the mall. We need tohave from the retailer's. Okay, that's a very good question. First, let me start by saying that the retailers know as much as you

know is the challenge with the retailers is is that they have all of the staff. They have all of this inventory, which will now be old, depending on what it is, and they have all of these expenses. So if any of you heard from Al Qaeda, John hadn't had a very lovely five minute presentation about what else I was going to do, I think it's worth listening to that, because what it shows is that the retail industry's and the retailers themselves are having a hard time with their hands around the issue. My senses is that as soon as the events that are keeping us locked down are opened and we could go back to a more normal lifestyle, that we will see Mawr and Mawr retail activity shops will open and they'll beam or things more people buying things. And and once there's more sales than people get more comfortable. And I would also say this when people are buying things like necessities, then there the first thing that they'll buy. And there's not a problem with that when they're buying other products that aren't necessary for their ongoing

well being and and maybe it's diamonds. I'm just trying to throw some ideas out here. Maybe it's something that they don't need to survive. today. Maybe it's not a new suit. I don't know what it is. Those types of items will take a lot longer, in my view, to come back. But in terms of the other things that people live with with their families, the T shirts that with different outfits that their Children need, that's all going to come back very quickly. All right, David, this is amid the money. Mad. How are you? I'm fine. Then you mentioned diamonds. I said, let me come and be a great conversation. It couldn't be better that I talked Diamonds. And the master of diamonds is with us. Are you good to see you find David. Thank you so much. And really appreciate you organizing this for the other parts. Been just from daytime amid the money and the managing director of that group CEO for the management. We have various retails, oppose hotels and malls. My question is, David a little bit different? Even we open, you know, upper business, especially, is not tourist driven. And we have inbound high end tourists who are coming to you. A who spending a find and

shoot. What is the timeline, you or other people? on this group. They feel that this unrestricted travel can start because for us, even if the mall opens and, like you rightly said, people will go for restaurants and other things before they could choose. What is the sensitive or a sensible timeline? Everybody feel that not more, but maybe 2030 40% off business can come back. Respect to the international travel and thanks, great questioning. A great point. I think what I would suggest is for you to review the Emirates airline website, and I've looked at that and I got a note that suggests that they're going to start with limited flights beginning in late April to mid end of May. That's just starting. But when you have the size of the fleet grounded like they do, I believe as soon as they are able to safely fly and carry passengers that we'll see people slowly come back. I think it's going to be by the end of this year before we get back to a normal

, more normal trading where you'll have visitors coming in. I would also suggest that it hasn't been decided yet, But if Expo 2020 is pushed ahead to 2021 is voted on by the authorities to do that, Then there will be all kinds of opportunities here for people to travel here and have, I think, a new four doble vacation in Dubai and will allow them to get out of wherever they are for a short time. And that's when I think the shopping for your kind of product and others will start to pick up. So my guess is that date is likely middle end of this year. But it also depends upon the second and the third wave that I've read about how this virus might affect us later. My sense of it is, is that once there's a test that's out that can tell who's had it, who hasn't and when people feel safe. If they've had it and they've recovered and they don't have any symptoms, then they're going to be the first to get on the airplane and travel and and explore. And I'd also say this that's bodes well for you in your industry or girl. Many people, although they're suffering and I know many of us are self

, there are a few that would be your clients who have probably made more money than they have ever made just because they don't have the expense level that they used to have. Or there is the ability for them. Guard lis of the circumstances they're in to go and shop and acquire and feel good about, or perhaps invest in diamond, which I know is a good part of your business is Well, there's a good people. Invest in diamonds for a long term appreciation and capital appreciation. So that z my opinion. Hi. Thank you. Yeah, this steady Christiansen from Nova Cinema's first of all thank you for putting this on, David. I think it's great platform for everybody in the community to come together on dshea rare experience of what we're all going through right now. I think first of all my mind is not really a question. I I wanted to say that, you know, right now we're experiencing very positive support from the landlord. You know, much needed support during this difficult time. It's challenging for all of us. And I think what we need to do right now is focus

on the plan the rebound plan, a za partner within our partnership between the landlord and the tenant. How can we work together? We need to obviously and still confident in our in our customers when they come back. What can we do as of now, during this period, give reassurance to continue to engage positively on with a little light humor with our customers. So I think this is if I think now more than ever, that partnership is coming into play, and I think we have to actively work together on this rebound plan. It's not about just what the landlord's going to do. We all have a role to play, to make sure that when the customer does come back, they feel confident and they feel valued and appreciated. We need to give him the reason to want to come back. So from my my perspective is about that we need to work together. How do we work together? Going forward? Let's come up with the rebound plan so that when the customer comes back, we're ready for them and they're excited about it

. I mean, I from my own perspective, I am absolutely going stir crazy working from home right now. I can't stand it. I can't wait together out of the house. I can't wait to go to the mall to have that experience of the retail shopping and eating out meeting up with friends. So that was kind of my position. Just to say, you know, we need to work together. All of us on this rebound planet is a partnership. We need to work within a partnership. Well, Debbie, thanks. I appreciate what you're saying, and I could not agree more. I think that that's a very important And I think that I know Leah is listening the director of our organization and I think that it would be greatly if you could write down the rebound plan for getting things back on back on to a more normal setting that be just in response to what you've said, and I agree with everything that you've said. But I would add one more thing to it. And that is, is that during times like this, it's probably the most important thing that you conduce as an organization and as what you do with no vote to keep front of mind of your customers

. And I don't know how you best do that, but I'm sure that you may have some ideas about how to get a hold of your customers and how to reach out to them, but digitally is, anyway, that you can to reach out to them from a marketing perspective. What I would do the consistent theme over a longer period of time and the big benefit that you have right now is that everybody is sitting at home and they have a computer or a mobile phone, or that whatever they do and they will see it. Whereas before the percentage of emails it was open, they say, was 13% and my guess would be probably less than that in the old days, I would say it's probably more than that today, which means that you would be able to interact more frequently more easily, using email. Another formats like What's up? Another formats that would reach a consistency of message over a longer period of time. Build those relationships and keep moving with it. You can't stop soon as you stop, you're going backwards. So I totally agree with you. David totally agree with you and we're I mean, we're doing that on a daily basis through through

digital across all social media. As you said, everybody stuck at home. Most people have a mobile phone or a laptop. So we're making sure that we engaged during this time not just with our customers, but also with our employees. Are keeping everybody positive, positive of mind, positive messaging. I'm lighthearted. Excuse me. A little bit of trivia, just to make sure that we maintain that engagement throughout. So completely agree with you on that. Thank you, David. Chris Segway here. Can I just come in with something very quickly? I just want Thio comment very quickly. There was question asked with regards to China that one thing for us to consider it will be aware off is for us to watch is that next week, as of the 14th of April, Austria is actually coming out of lock down the way that they've set it up in the way we understand it. I'm sharing this for us to as an industry, keep an eye on and see how that's gonna work out. Basically, their intention is to open up non essential food off a size approximately less than 400 square meters of trading

to see how that goes. Now clearly there's mechanisms that need to be put in place about social distancing and so on, but that's the first step. Their expectation is that on the first of May, or from the first of May in general, on shopping malls, etcetera will be able to open up. However, it's unlikely that restaurants or hotels will be allowed to open until probably later in May, maybe amid Thio, latter part of May. So I'm giving this out there for us to consider and monitor see what that looks like and how that might affect our own countries or our own sectors in the industry. I'm actually based in Paris, in France, and our approach here is very different. Attar moment. We're still locked down and will be for at least another week, maybe to the end of the month. So the big question is around. People have tested how the social distancing is managed, but I think Austria will be a good template for us to monitor and observe how that might affect Chris Well said. And thank you. And you're right, I've read actually that Austria is opening up another. There's another place to that. I remember in the Western Europe. But that's great news. We'll watch

Austria for sure. This is from Amusement Services International to Debby's question in terms of the rebound plan. Now I see that after the lockdowns, you know, open and people can go out. I think the confidence level of people will still be a little bit of local. It's a little bit low in terms off shopping, since online shopping has become so prominent. Andi, I think for them to go to a mall would be the experience the service anchors. And I think, what kind of an experience or social experience they get on what kind of promotions retail outlets have, which they can't get online. So if there would be a cross promotion, say, for example, between a movie cinema Onda, a retail store, I think that's something that would take them toe that retail store. So this is the kind of rebound that I see with consumers going to a model. Yeah, I agree. I think it just stated it well. Hello, David. Hi. This is Baijiu here. Beige. You. How are

you? Very good, David. Thank you so much for putting this together. It's not a question. I just wanted to add something as an answer to what he had heard a question earlier. Eso What we're doing is we're birthmark management and marketing consulting. We're doing two sets off service. So one question we send among the retailers asking them what their expectations are. And I'm very happy to share the results with you. David. Uh, give it another five more days. On second, we've also got responsible about 15 malls as to what they're planning to do on. I'll be happy to come build that and senator across to you as well. Uh, yeah. You can expect both of this by let's say, Mitt up next week. Excellent. We'll make sure that we posted. And I appreciate your support as always. Thank you. Beijing. Yeah. Yeah. Actually, I I would like to update you about China. I have got some news from our partners who has officers drive there. After they came

out from this covert 19 issue, they found that the footfall on their modes came back as 30%. Only off the what it used to be. So this will be this might be an indicator for for us all that I gradually as everyone believes a gradual recovery will happen. So this is the only benchmark we have so far. We are very eager, very eager with time to have more countries coming out of this crisis to see what will be the norm coming out of it. I just wanted to share this with everyone. Mohammad, thank you for that. Great to get that feedback. And once again, it shows you the strength of being together as an industry and being a member of our organization. You can share this information and it becomes, I think, more meaningful for you. Thank you very much. Thank you. Good morning, David. This is Tony from jail. Actually, I have a question. I've been asked by one of the retailers a few days ago, and I'm not sure if you can answer me. So

does the retail or have the legal grounds to break out from a bad lease or renegotiate the terms using the force majeure clause since their businesses is shut down and they're heavily affected. Thank you. Well, great question. I have had legal training in my background, but I can say that I am not a practicing lawyer, nor would I ever think I would be, But I can suggest that Read the least, because everything that's in the least is what stands in the agreement between the two parties. My sense of it is is that you will be best suited to have a strong relationship with whoever it is who is negotiating and the force majeure clause. I'm really not sure, because there are so many different iterations of a force majeure clause that even I've been aware of in my career over the years. So it would depend upon how of the force majeure clause that was signed up by both parties. But I can suggest that the relationship is gonna be the most important part of the whole thing. The relationship between the two parties. Hello

, everyone. Liability from Iran, In my opinion, I want to make it short. In my opinion, Cove in 19 will have probably two major effects on people's lifestyle and customers lifestyle one financially and the other is psychologic on. I was wondering if there is any kind of estimation or studies that how this on to what extent this, uh, era, this lock down will effect on the habits of people like, Let's make it more clear. For example, people are going thio by mawr. Food and beverage will go to food and beverage rather than fashion more than before or how this percentage will change. And do you think it will have any major changes? It will force malls to change their zoning their tenant mixes and their footfall will be affected by that. I was wondering if

you had any estimation of that. Thank you. Say thank you, Great Thio. See you on screen and thank you for joining the call from around What I could tell you after watching the industry and seeing what's going on. People generally, unless there's a life threatening event, have a short memory and by short memory, I mean they resolved to the old way. They did things very quickly. So my sense of it is no. Things won't have to change in the mix and the look and feel of the shopping center right away. I think that over time they will evolve. They will continue to evolve. But my opinion is is that with this pandemic it will not cause an overnight change in the behavior. What will happen is that From a financial point of view, Once people are backed wrong financial footing, they will resort to the way in the habits that they had even before this pandemic broke out. As long as there is no risk to their health, that's that's my opinion. Okay, but do you have any estimation off the

period? For example, if this lock down period take six months or four months, how will it affect the period of going back to the previous situation? I mean, probably in the close future, we will see some changes. People, I think people with financial shortage we'll go. This is just an example. We'll go for food and beverage rather than fashion is so. I told before on it will take some time. Thio, go back to that era. Do you have any kind of estimation that how how long will it take to go back, depending on the lock down period? Well, you know, the best guess is is that it will be probably 68 months after normal trading recommences that it will be back to a more normal state. We had a chat a little earlier in this weapon are about the fact that once people feel safe about what they're doing and once they're back and, um, or social footing

with the people that are with them, their family or friends, they will go back and get out and be part of that community. That's a shopping center industry. But I think you're right. I think people will always default to what's more important. It's the Maslow's hierarchy, and that's its food. And shelter is at the top. And then everything else after that. Hi, David. Hi. Thanks so much, David, for gathering us here. I have a question to you, David. How do you think landlords should support retailers and how long? Retailers can survive while stores are closed especially, especially if landlords are not supporting. This is one question to you and to everyone. Definitely another question. How how our landlord supporting retailers in different countries. Thanks, Lena. And thanks for waiting for your question. Well, first of all, your questions been heard by the 131 participants that are with us right now, so they all have their own ideas

. Um, I would go back, and I know you and I have had this conversation. Many times. But it's all about the relationship with the retailers that you have when you listen to what John Hatton said on his video. The YouTube clip that came out about Al Sha and what they were doing. So they have 60,000 employees and they have 4500 stores and their revenues have dropped 95% and they have less than 1% of their stores open. So that's probably a fairly typical scenario for most retailers. But I think I'll shieh, from what John Hatton was saying is probably one of the more hard hit retailers. They're all been hard hit, but this is a magnitude that is sizable. He has said that they will do whatever they can and work with whoever they have to to carry on because he wants a strategy that will be in place for after trading goes back. And I would suggest for you and what you're doing the tendon is to make sure that your relationship with those retailers is strong enough so that they know

what you're thinking. Almost on a daily basis, you can never make up and decide what somebody is going to do. You can give them guidance, but you cannot control. And as long as you are having a relationship with them and you have an open communication with them, my opinion is that you'll be able to do more and be more productive with that tenant in what you want to do and how they want to proceed or not. Proceed. And and there's no illusion there will be many retailers, some retailers, anyway, that will close after this because they will just have born so many losses that they can't carry on. There will be other retailers on the same side that will say, We want to expand MAWR There's more opportunity for us because they sat back and decided, Here's where the niches And here's what I wanna do It's up for you. As an operator of management company in Tan, Dien is a developer to understand what you could do to secure those viable retailers

in the future. It means more work than ever. I was chatting with someone who is in London the other day and they were chatting with Cushman Wakefield in London in their offices and all of the things that were going on and they were all now working 14 to 18 hours, a lot of them from home on Lee on relationship building, with all of their clients trying to determine what the next best step. But that gives you an idea of what people are having to do to retain the relationships with these retailers or with the shopping center owners or with any client that you might have. So I can't answer your question specifically, but I know that everyone 135 people who are here they could probably learn something from and respond back to you. And we would be happy to connect you. Andrew. I was Riyadh. Hi, David. Good. Thanks. Thanks for hosting this today and thanks everybody for being here. It's great to see everybody. I just had a comment, um, on China. I was speaking with the seal of Live it he had

because something like this a webinar with lots of people the other week, talking to people and globally, he's been going around the world talking to everyone in about F and B, And in China and Asia, where they opened the restaurants again, they found that within eight days they got back to the sales that they were before the crisis. So that great information Great. Positive? Yeah, that was it. That was my comment. I David, this is a smart from centric. Okay, David, I give a question around this digital transformation and some of the channels that we're seeing that models are opening up, especially with by mall stating that they're gonna have a store at noon. And right now, I went from all off immigrants website and other is here in this meeting as well, and they're mentioning something about fashion delivered at your doorstep. So I want to see whether this is like a tactical bit that the malls are doing for a really short time. Or this could potentially become a new normal for the malls, where

they're gonna offer retailers, the shops as well as the e commerce within the more landscape and build some type of systems around there. Well, this man great point, and I like your comment. I would suggest that follow the money. So if it has been successful for these shopping center owners and for the likes of noon to do that and they're making money at it, you can rest assured they will continue to do it, and if they may, are maybe not as successful, then perhaps you will see that they won't be quite as energetic and promoting it the way they have been. But my opinion is, is that you've got the staff in place, you're paying them. Why not check and see what other venues or avenues are available and open to keep business the wheels of business journey? But good point and I would I'd like to follow up on that one myself to see what happens, because I think that that's probably a good way for shopping centers to keep connected with their shoppers and their customers. And the public, Thank you

very much, can be called Yes, hi, Thank you very much. Just a quick comment. I think that I've heard this or not heard it quite a bit, and I think it's something for us to consider. So piggybacking on the question about landlord tenant relationships, which is a big conversation on many clients who on the retail side, who I deal with Avery interesting sights. But the comment I want to make it two fold first thing is in many of these reviews, assessments, discussions about how the industry will get out of where we are. I believe we forget two key components to key groups. The first is the banking sector. I think if the banks or the financial institutions or the lenders are not around the table in this conversation, we're going to come out of it weaker and more challenged structurally as an industry. So I think we do need to find a way to bring them around the table. Second, is the valuations

off shopping centers in particular and obviously other retailer assets. Again, if the value is air not around the table for a conversation, there's gonna be a significant mismatch between where we believe we are today. Owner point of view, Andi, where the valuers seem, believe it's going to be and therefore pricing and therefore, you know, in the future there will be transactions taking place. So I think we need to find a way as an industry two inch sure that the table having a conversation and not behind the scenes because clearly has his own challenges or their own challenges. With regards offering rent free and so on or cancel visas, they will have their their assets, and they have a certain value attached to it. The final quick comment. David. And then I'll hand back the mic. I think it's fair to say that here in France to a question that was posed earlier on one landlord, as soon as three lock down was announced, they

made the unilateral decision. They're not a quoted on the stock exchange, but they made the unilateral decision cancel all rent for a minimum of one month. I think each landlord approaches it differently there, who are visionary and very close to their tenants, to your point, David, and that's what he said, he said. Look, at the end of the day, I love my tenants, so I'm going to support the best I can, and I think that's a great attitude. Thio have. Thanks, Chris. I appreciate that. And you're right. The banks and the financing they all have a fairly significant role have a very significant role and we need to bring them around. We do have members in the Middle East Council of shopping Centers and retailers who are with the major banks in a bid A B, and we will certainly engage with them is a very good point and get their input on what the next step would be your best step with. So thank you for that, Chris. Good morning, everybody. It's great to see you all. I have a question for you, particularly in view of the comments about Al

Shaya, which you're really quite shocking. Bearing in mind that Al Shaya and other major retailers such as them are a key tenants in many or most of the major shopping centers in your region. What effect is this likely tohave on malls, which may be under construction at the moment. So they on hold or going slow. Are you able to make a few comments on that, please? Well, thanks, it's great. Thio, great to see you and great to connect again. Um, I would need to speak with the leasing teams specifically, but what I can tell you is this is that when retailers air in survival mode, which many are in today, perhaps one of the least important things for them to do are to carry on and least new spaces. So my sense is, new shopping centers are definitely

going to be under pressure that that would take a long time to come back. How about those which may be under construction at the moment? Well, there's a number that are under construction in Nevada V. And I know that the people, for example, at re mall I had some conversations with them. And I know that Lena, who is on this call, is under construction on some projects that air in Kuwait. But I would suggest that it zippity stiff headwinds that they're facing to conclude any kinds of lease agreements these days. It's just not the priority. The way I see it, for a lot of these retailers to be looking at thes shopping centers today that Zaire destruction stuff. You know, I haven't been there to see, so I don't know, I guess I could go online and look at re mall and see if they are because they have some webcams that are over top of the site. But I have not. So I don't know. Thank you. Okay. Thank you. Yes

. Hi, David. I'll keep it very shot. It's not really a question. What often? Opinion off course that I'd like to know once this crisis is over on hopefully soon. Do you foresee any changes in terms of the mall operations as an, well, the local authority and mean all by the mall themselves? Will they have any change in terms off the mall Operational? Will it be more or less, or will they have any sort of a safety protocols, which they will be enforcing on? What do you think will the report will be the repercussions off those decisions on the retailer's? That's a good point and a good question. And my opinion is, this is that health and safety has always been right at the very top for all governments, first of all, and then shopping center owners. And my view is that the health and safety has got to be probably the most important priority. My expectation is that after the pandemic passes through and we're back to more of a normal footing, that we will see perhaps

mawr focus on health and safety aspect as related to social distancing and to how to manage pandemics are disease outbreaks. There will probably be mawr of that. So, um, is that important for the retailers? Yes, absolutely important for the retailers where they expect anything else? I don't think so. I think everybody's interest is toe have the safest place that we can be these days and enjoy healthy life going forward. So there are costs associated with that and how you react to that. I think it depends on the person or the business or whatever your perspective is. But I would suggest that there will be more attention on health and safety, safety aspects and shopping centers and in the region than there has been in the past. So yes, I could say that and how that affects the retailers. It'll affect the retailers anyway, that the government seized. Yes, and I never

see. How are you? Fine, thank you. Thanks for the offer. Study. This'll is a question on plus maybe a suggestion. We're talking about the landlords and retailers. Why don't the landlord's work on a commission basis with the retailers? Maybe that can be a good solution. What do you think off in this point? And, uh, everybody can answer for anybody. Asset. Because our boutique in a hotel, we're trying to do dumps in the based on that, the commission's on a yearly basis. So this way we can able to sustain rather than like being a bulk amount are like in a situation like this, we can able to survive, I believe. Okay, let's see. Thanks. Great to see you again. Um, that goes back to a very popular percent. Only rent and I was mentioning earlier in this weapon are that I believe that it may the pandemic may cause a march transparent relationship between the retailers

and the shopping center owners and in which case, the percent rent, which I think you're alluding to when you talk about commissions. The percent rent, I think, is probably going to be a very solid way forward. But it means that it has to be very transparent on both ways. Both the landlord and the retailer have to understand that it's a two way street and that there's no perfect solution either way. I mean, as Chris was telling us from Paris earlier, landlords have their same challenges because they have the banks and financing and all of these other economic issues that are part of what they have to manage. And the shopping center owner has a retailers and they're in the middle of both of those things. trying to make it work. So my sense is once again more transparency in the future in the region. And second of all, I would think that percent only rent is probably a good way to go, particularly to help bridge that gap between now and when things air more on a more normal

footing. Uh, they secular. Thank you very much for the great initiative. I would like to talk on behalf of Sharrock Group and I'm from Times Square Center, but we have other mold that are under my portfolio in Oman and other area. And there's commercial cover. So I'm representing developer here shopping all developer, especially private ones. Landlords are tenants are asking us to give them Iran's relief. And we don't have anyone to go and ask Grant live. So is it You know NBC s C. Can you be like you are the voice off? Almost. Can we ask government at these kinds off that relief from the shopping mall developers. Okay, we are ready. Toe have tenants and we are doing as a Sharaf group. But off course we have our limitation. Is that so? Can you help us on this? Is that shopping

malls. Voice. Yes. Well, that's yes. We can help and we will on there's a number of initiatives that we can do. Our contacts are with different levels of the government, and we can follow through and see what we can do. I don't think we have any guarantees that will be successful or whatever we outcome. Whatever the outcome is, however, we will reach out and we will do what we can to assist you. I know that what I've learned is the government owned shopping centers. In the for instance, I think we'll have more support than shopping centers, like perhaps the the Sharaf Group have. But I think that there's gotta be some kind of a mechanism that I've read about that I'll go back and research that more fully. So good question, Nancy. Great to see you again. And we look forward to catching up. Thank you. Thank you. Very. And for the final question, Lena, I just wanted to share that our chairman chairman off Indiana Group decided

to waive the rent during the mall closure. So, uh, regardless off how long the mall will be closed, we're not gonna take any events from our investors. This is one second our Children decided as well to give 40% discount on the land after the moms will often till the end of the year. So this is what we are doing. But I wanted to know and to hear from other moles what they are doing in different countries, like in Dubai proper. Guess a bar in Jordan. I really need to know if you have an idea or anyone can share with you. Thank you, Lena. Good point. And I know that you work for a fantastic organization in Tan Dien Group and the Marzouk family are very, very generous with their offer already. I would leave it to the rest of the people who are on this call to maybe connect with

you, or we will help to facilitate that one way or another to make sure that you can find out from other people how that will work. But great to hear from you. And thank you for them. Yes, and they did, uh, if you have any other final message for everyone. Well, thanks very much. First of all, everyone who joined I think it's fantastic to see your faces and have the questions and making it interactive. I really appreciate that. And thanks to the team who have made it all possible for me to be here and speak like this, I know that everyone on our team and its has done a fantastic job and continues to do that. I would say we need to hear from you, and I know that we're reaching out. And I know that head of our membership side, Angelo is still doing around 70 phone calls a day reaching out to everybody. But I would suggest this and that is that we would like to hear from you. So call our team, call me directly

email. Whatever it is you want to do, we'll come back. We'll have another weapon. Are we appreciate the support that you've shown us, and we look forward to meeting you all seeing you all in the future. But please don't hesitate to reach out and ask us how we can help you. We're here for you. So anyway, thanks very much, everyone. I appreciate your time. Thank you very much.

Impact of COVID-19 In The Shopping Centre and Retail Industry
Impact of COVID-19 In The Shopping Centre and Retail Industry
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