Real estate: New shopping malls and vacant
city centers
The plans for Factory Outlet Centers in Zevenaar and Assen and the
conversion of the shopping center Leidsenhage into a mall are raising a lot of
controversy. Shop owners from all over the region are strongly opposed, as
the vacancy level of retail properties is rather high and “outlet shopping” will
be detrimental to their (already low) turnover and could lead to bankruptcy
and even more vacant retail space. What can you do against such
developments?
**
About the author:
Ynze Kliphuis is a lawyer at Russell Advocaten. He specializes in
civil and administrative real estate law.
Retail under pressure: vacant retail stores
The last week of 2015 was a black chapter for the Dutch retail sector:
consecutively, drug store retail chain DA, shoe retail chain Macintosh Retail Group
and the chain of department stores V&D were declared bankrupt. In previous
months, amongst others, (the parent companies of) Dixons/MyCom, Van Dalen/Dr.
Adam’s Footwear, Miss Etam and Schoenenreus went bankrupt. More and more
vacant retail space can be expected, especially in small and medium-sized towns.
Nevertheless expansion of retail space: shopping malls
Fifteen years ago, the first large shopping malls were built in the Netherlands
outside the traditional city centers: Bataviastad (Lelystad), Designer Outlet
Roermond and Rosada Fashion Outlet in Roosendaal. Apart from the fact that these
shopping malls are being expanded (will be expanded) considerably, there is also a
fierce debate going on about initiatives for the construction of similar shopping
malls, where the focus will be on ‘shopping experience’, ‘fun shopping’ and ‘a day
out shopping’, as for instance in Assen, Halfweg (SugarCity), Zevenaar and
Leidsenhage. The key aspect of the debate is that the shopping malls will not
provide a solution for the existing vacant retail space in shopping centers but will
instead increase the level of vacancy. Thus, many shop owners raise objections
against these plans. The municipalities concerned propose, conversely, that the
shop owners will profit from more clients from the region and an increase in
employment.
Legal options
What can entrepreneurs do against such plans by the municipality? The chance to
prevent a shopping mall by using legal remedies is small. If the municipality – who
renders this possible in a zoning plan – substantiates that there is a need for such
a facility in the region, the Administrative Jurisdiction Division of the Council of
State will reject objections on the grounds of vacancy. Often, such projects can only
be postponed, not cancelled. However, such a postponement can give
entrepreneurs the opportunity to prepare for the situation ahead: by claiming
turnover related lease, adapting their range of products or by making the shop
(more) attractive to shoppers in any other way. Besides, vacant retail space can
also provide the opportunity to lease a better location in the city center.
Exerting influence on the political process seems to provide more opportunities to
prevent a shopping mall than legal remedies. This way, the interests of the Province
and the surrounding municipalities can be brought in line with interests of the
shops in the city center. Russell Advocaten gladly provides advice about the
opportunities to find a political solution by means of independent consultancy.
More information
Do you have any questions about retail property being threatened or any other
questions about real estate? The specialists at Russell Advocaten will gladly
provide you with advice. Please contact:
Ynze Kliphuis, LL.M. ([email protected]).