F&B continues to grow

Published:  30 June, 2017

Cushman & Wakefield research shows catering accounts for 20 per cent of new space

The increasing presence of food and beverage (F&B) options in shopping centres – often accounting for more than 20 per cent of units in new and redeveloped schemes in more mature markets – is being driven by rapid global growth in consumer spending on eating out, according to a new report from Cushman & Wakefield.

With spending on eating out expected to continue growing over the next 10 years, and consumers’ desire to enhance a shopping trip with social and leisure experiences, a compelling F&B offer is now critical to the success of any retail scheme, the report states.

Although it lags behind other global markets Europe is nonetheless expected to experience healthy F&B annual spending growth of 4.9 per cent. Within Europe, Turkey will see the largest increase across the region, with an average growth rate of 8.8 per cent in the F&B sector, although this is down on the 9.3 per cent growth recorded over the last four years. The country’s youthful population and growing economy continue to power the F&B market, despite recent political upheaval and security risks. Central and Eastern European markets in particular Romania, Bulgaria and Poland are also set for strong growth in the future.

Spain was the largest F&B market in Europe in 2016, with consumer spending on eating out reaching $133 billion. This was ahead of the larger economies of the UK, Italy, Germany and France.

Darren Yates, head of EMEA retail research & insight, said: “The link between shopping and eating is stronger than ever and is evident in the significant growth in F&B outlets in recent years, particularly in shopping centres. We see this trend continuing for the foreseeable future, given that a high-quality F&B offer is now critical to the success of major retail destinations. An increasing number of locations are now incorporating formats which combine the experience of eating and buying food and entertainment, which taps into consumers’ growing interest in food culture.

“While the short to medium-term outlook for the F&B sector is positive, strong recent growth in the sector means competition in some of the more mature markets such as the USA and the UK is intensifying. As a result, weaker operators may struggle if economic growth begins to moderate and consumers rein back on discretionary spending.”

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