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News that Unibail-Rodamco-Westfield has been granted consent to convert most of the former House of Fraser store at Westfield London into co-working office space has highlighted the potential for change of use of surplus retail space. But what are the operational implications of bringing workspaces into the mall?

New uses for vacant retail space

With store closures mounting up on a weekly basis, mall owners are increasingly looking for new uses for vacant retail space. For several years food & beverage businesses were seen as the natural replacement for failed retailers. But now the casual dining sector has problems all of its own. So what’s the next alternative?

House of Fraser has pulled out of Westfield London after the landlord failed to agree to its demand for rental reductions. But now the mall owner has identified a new potential income stream. In July 2020 it was granted planning permission to convert 68,000 of floor space into a co-working hub, retaining 32,000 sq ft of retail space on the ground floor.

And other owners are also exploring the possibility of bringing co-working into the mall.  AEW is reportedly working on plans for co-working pods on the mall and in smaller void units at Festival Place in Basingstoke. And this trend is global, with similar conversions reported in Canada where co-working operator Lauft has opened in six malls.

New office occupiers

For mall operators the new office occupiers have more to offer than just rental income.  They have the potential to become active members of the mall community. If they are properly incentivised, they can make a meaningful contribution to the turnover of neighbouring retailers, restaurants and coffee shops.  Done properly, leasing void space to office users is a way of growing the centre’s core catchment.

But to achieve that the office workers need to feel welcome and appreciated.  They want and need access to information about what’s on offer. This is where the Mallcomm app comes in. It’s an effective way of integrating the new office users into the wider mall community.  Its functionality is as applicable to multi-let office space as it is to retail. 

Mallcomm can help keep the spend within the mall

For instance by allowing office workers to order lunchtime sandwiches from the mall’s F&B operators direct from their desks. And Mallcomm’s staff discount module can be extended to office users. Already in one mall, it is generating £150k of additional spend for retailers.

Mallcomm’s CEO, Michelle Buxton says: “As the tenant mix broadens it’s important to bring all stakeholders together.  Creating a sense of community which improves retention and minimises voids. In Mallcomm mall managers have ready-made communication and CRM tool that allows them to engage with an increasingly disparate group of stakeholders. For a relatively small incremental cost, they have all the tools they need to grow their own catchment.”