Food pulls in more shoppers

LAS VEGAS - When it comes to attracting shoppers, retailers of fashion, home furnishings, books and other goods have found a fast friend in food.

Developers and analysts say restaurants and other food vendors are now the "must-haves" in retail development.

"A restaurant is as important as a good department store," said Yaromir Steiner, chief executive of developer Steiner & Associates.

Food's new status as a shopping centre drawcard has strengthened with the explosive growth of town-centre and "lifestyle" development.

"It's very much becoming a driver," said Friedman Billings Ramsey analyst Paul Morgan.

Lifestyle centres and town centres - open-air retail shopping centres usually anchored by a home-furnishing store or bookstore - are now essential to developers.

Even mall-owners such as Simon Property and General Growth Properties are jumping into the game, building lifestyle centres or adding them to existing projects. Mixed-use projects that combine retail with office or residential development are also on the popular track.

"That's what everyone wants," Morgan said. "People want a downtown feel."

Steiner's exhibit at the 2005 International Council of Shopping Centres Convention in Los Angeles was packed with developers and retailers.

The conference attracted more than 40,000 bankers, brokers, developers and retailers, and "lifestyle" and "mixed-use" were the buzzwords.

When its CocoWalk centre opened in Coconut Grove, Florida, 12 years ago Steiner became one of the first lifestyle developers.

"People said you never put restaurants with retail because they take up the parking," Steiner said. "People said you never put movie theatres with retail because they take up the parking."

But the retail stores' sales increased between 200 and 300 per cent.

Today's development must include enough restaurants to provide a town or lifestyle centre with seating for about 2000, Steiner said.

"The landlords are using the restaurants as mini-anchors," said Marci Rude, director of western US real estate for P. F. Chang's China Bistro.

"A landlord will come to a tenant like a P. F. Chang's and say, 'We want to negotiate the deal with you and we want you to be the catalyst to our project'," Rude said.

"It's a situation where they'll say, 'If we get you signed up then we can have these other tenants that will drive the project in the direction we want to go."'

The company runs 117 P. F. Chang's and 58 Pei Wei smaller-scale, lower-priced Asian-fare restaurants.

It is considered one of the darlings of Simon Property and General Growth, with its plans to add 16 to 20 P. F. Changs this year and about the same number next year. '

- REUTERS