Westfield plc

Westfield plc specialises in the management, leasing, development, design, construction and funding of shopping centres. They have £14.3 billion of assets under management in a portfolio of 124 shopping centres around the world, with more than 20,200 retailers and approximately 9.8 million square metres of retail space.

Hermes Property Asset Management Limited holds £3.699 billion assets in the retail sector, the majority of which is invested directly and indirectly in 17 shopping centres throughout the UK.

The challenge

Westfield plc and Hermes Property Asset Management, owners of the Eagle Centre in Derby, plan to redevelop, expand and reposition the centre. On completion, the centre will provide around 1 million sq.ft. of retail and leisure floorspace, which, in terms of scale, places the centre amongst the top shopping centres in Great Britain. CACI was instructed by Westfield, on behalf of the joint owners, to provide an independent, strategic assessment of the retail potential resulting from this major redevelopment.

CACI's analysis focused on answering the following key questions:

	What will be the extent of sales uplift achieved by Derby as a result of the Eagle Centre redevelopment?
	Is the scheme sustainable given significant shopping centre development in the region?
	What will be the future scheme's turnover potential and how will individual tenants perform?

The solution

In order to quantify the extent of sales uplift to Derby post the redevelopment of the Eagle Centre, and from this, forecast future scheme turnover potential, CACI used Retail Footprint, our national, market leading gravity model.

CACI used Retail Footprint to quantify the change in regional shopping patterns and Derby's increased market share post development. Within this, CACI assessed a range of development and competitive scenarios, including different scheme configurations and the impact of known developments in competing centres such as Nottingham,Leicester, Sheffield and Stoke-on-Trent. The outputs from these models formed the basis for CACI's overall scheme and unit by unit turnover forecasts. Together with analysis of Derby's future ACORN profile, spending patterns and benchmark centres, CACI were able to provide the joint owners with clear recommendations on maximising future trading potential, optimum retail mix and overall strategic direction.

The results and benefits

CACI established that the retail offer in Derby does not adequately cater for current shopping demand, with a significant amount of retail expenditure leaking to competing regional destinations. CACI recognised that the proposed redevelopment of the Eagle Centre would provide Derby with the critical mass necessary to alter local and regional shopping patterns and move the city up the retail hierarchy. The assessment also established that the retail and tenant mix targeted for the scheme would position the scheme as the primary retail destination in the city.

CACI's forecasts for Derby and the Eagle Centre demonstrated that the scheme provides a significant trading opportunity for retailers, presenting them with the potential to generate strong sales performance.

According to Peter Miller, Development Director at Westfield:

"CACI has proved to be a valuable member of the team which was brought together to establish the market potential for the proposed development of The Eagle Centre. The research undertaken by CACI has provided the owners with valuable market knowledge, helping to further validate the scale and nature of development proposed for Derby. Importantly, the study carried out by CACI provided the owners with the confidence that demand existed to support a successful and viable development of the Eagle Centre."

Retail Footprint