Antoine Nougarède

Managing Director at Retail & Connexions

Double the space for retail and services in stations within 10 years

Retail & Connexions, a subsidiary of SNCF, manages nearly 200,000 square metres of rental space in stations, earning €190M€ annually and business is booming. Antoine Nougarède is the Managing Director of Retail & Connexions.

Which stations have retail activities?

Of the 3000 stations operated by SNCF, 400 have an annual flow of more than 250,000 passengers and at least one shop. In about 50 major stations in Paris and other cities, the volume of traffic allows us to market an expanded offering. Flows are much higher than in large shopping centres: up to 10 times higher at Gare du Nord, with its annual 200 million passengers. This is why we are planning to double the retail space in stations in the coming 10 years, and to significantly improve the quality of the line-up.

For retailers, what are the other main differences between stations and shopping centres?

In addition to their impressive flow of passengers, stations are generally an integral part of city centres and business districts, and can attract people who are not actually travelling, provided the retail offering appeals to them. The largest ones are open from 6am to midnight, and some have shops open on Sunday. One out of three visitors enters a shop and two-thirds of them make a purchase. The total yield per square metre is much higher than average. Administratively, our contracts are temporary agreements or authorisations for occupancy of public property, without key money. Unlike commercial leases for 3, 6 or 9 years, they do not generate goodwill for the tenant, and their duration is generally shorter, but we adjust it according to the investment to be paid off. For a restaurant requiring a lot of installation work, the contract may be for 10 years. For other types of business, the duration might be 4 or 5 years. Such terms are acceptable to the tenants. Like shopping centres, we require a minimum fixed fee and a variable fee that can represent, in our case, up to 30% of turnover beyond a given threshold.

How will you raise the quality of the line-up?

Given the short duration of the contracts, we are lucky to be able to frequently re-market our spaces, and reach out to what we consider the most dynamic retailers. In recent years, we have achieved an upscaling of full-service restaurants in several large Parisian stations where we brought in renowned chefs. We also ask major operators specialised in station retailing, who manage a large share of points of sale and brands, to include franchises with popular eateries such as Paul, Prêt à Manger, Five G, Big Mamma, Eclair de Génie, Pradier, Big Fernand, Picto  etc. For large projects, we work with shopping centre real estate companies because it is also their core business: Klépierre at Saint-Lazare station, and now Altaréa Cogedim at Montparnasse station which will be completely revamped, with approximately 100 boutiques.