Retail real estate consultants confronted with an increasingly complex field

It is now widely accepted that retail real estate is a matter for specialists. But, as the field grows more complex, what are the limits of this expertise and what particular added value do consultants offer?

In the past, with the notable exception of specialist real estate companies, retail real estate was managed essentially by owners acting more or less like mere rent collectors. As for local governments, they paid little attention to the sector.

Since the 2000s, and especially since the financial crisis, institutional and private investors have begun to realize that retail properties deserved special treatment. Like the specialised real estate companies, they availed themselves of the services of experts. But, unlike the companies which handle these functions in-house, investors generally turn to consultants or service providers.

The strategy of a global project-oriented consulting firm

This trend encouraged the development of the consulting market, covered primarily by professionals in highly specialised sectors. In contrast, the strategy adopted by Convergences in 2010 consisted in organising a full range of services to address all the issues its customers face: market studies, project development, leasing, property and asset management. This is the strategy of a global project-oriented consulting firm.

Because the consulting firm has all of the necessary skills in-house, this also facilitates a more in-depth approach and project-oriented consulting.

Broader scope of action

The environment has again greatly evolved since the beginning of the current decade, in part because the future of retail activities now clearly implies reintegration in dense and mixed-use urban places, after half a century of autonomous or even antagonistic development (mono-function retailing sites on the urban fringe, introverted shopping centres, etc.). This change means that the scope of retail real estate professionals has vastly expanded to include tourism and cultural activities, security concerns, smart city technologies, and more.

At a certain level, it is relatively “easy” to call on experts in related fields to complement one’s own skill set. A network of partners can be called in to form an ad hoc team for a project.

Increasingly complex rules

However, since this broader scope implies a multiplicity of considerations for each project, it takes a very solid structure to assemble all of the required skills and know-how. Digital transition, the fight against climate change and endlessly changing legal requirements add a very thick layer of complexity to our business.

Certain areas of expertise have become so crucial - marketing and legal, for example – that their presence in-house is becoming a true necessity.

A solid architecture of services

The idea is not to gather all skills in-house, but to bolster the structure of the business.

To do this, a company must have a certain critical mass, hence the merger of CBRE France and Convergences last Spring, which has already proved its value. For major projects, especially, we can more easily form and manage our project teams.

How far will this trend go? That is the question that motivates us and confirms our original idea, now backed by greater resources, that we need a complete skill set to offer our clients genuinely comprehensive, enlightened and operational guidance.