How One Shopping Center Owner Embraced a Zero Warning Crisis to Maintain Shopping Center Success
When retail businesses shuttered overnight, and without warning, owners at the helm of shopping centers were provided the opportunity to be active agents of empowerment and drive new strategies for their retailers by seeing themselves more as partners than as owners.
The COVID-19 pandemic had a major impact on the retail industry and has served to accelerate changes affecting shopping centers, and to expedite innovation among merchants and property owners alike. Our team at Beta spoke with Sandy Sigal, Chairman and CEO of NewMark Merrill Companies, to explore the evolution of shopping centers through the months of COVID-related lockdowns and discussed the strategies that he implemented across properties to ensure that merchants were set up to continue serving their community and to emerge from the pandemic stronger than ever.
In 1997, Sigal founded NewMark Merrill Companies, which has grown to be one of the most prominent privately held developers and owners of about 80 shopping centers in California, Colorado, and Illinois. With over 30 years of experience, he has developed an acute level of foresight that melds human behavior with the evolution of technology.
“From day one, it was all about making a human connection through direct communication” – Sandy Sigal
His experience proved invaluable in navigating the immediate onset of confusion and financial fall out as a result of stay-at-home orders. The zero-warning transformation was without a playbook, leading Sigal and his team to establish a stringent communications protocol – and consistent messaging – in response to the initial shutdowns, acting quickly through a series of iterative steps.
“At the onset of the pandemic, everything for the first 30 days was about communication to build trust and transparency in engaging with merchants, lenders, city managers, and state and national leaders,” says Sigal. “The theme was no merchant left behind, and when we come out of this our goal is to be closer to every community. Shopping centers are the core of a community, where people make memories and socialize, and each community has a stake in keeping local businesses alive.” Through the first month of the pandemic, Sigal implemented community engagement programs that continued through lockdown, including the Wave of Kindness, along with a film series called the American Dream Series.
Sigal’s rapid response was ultimately strengthened by strategic foresight and investments in preparation for shifting trends and insights in retail. Over the past ten years, his team has made ample investment in technology and analytics platforms. “We weren’t starting at zero,” he says. “We knew on Day 1 of lockdown what the traffic counts were at our centers, and we were able to track their ebbs and flows in real time.”
Having these data points provided scorecards that served to be a powerful component in communications with merchants, lenders, and government leaders to show the transitory state of critical flux that community centers were experiencing. Additionally, he and his team gained insight from digital platforms such as Placer and Merchant Centric, the latter of which provides real time feedback on customer sentiment to amplify engagement and experiences.
In parallel with uncovering and providing enhanced transparency through these communications and data analytics, Sigal and his team invested heavily in long-term placemaking initiatives, such as permanent outdoor gathering spaces and health safety installations, spending a minimum of $50,000 per development with plans to only accelerate that spend. In the aftermath of the pandemic, developers and merchants have a higher bar to deliver because people know that they have options in seeking an optimal shopping experience. Sigal emphasizes that “we have a once in a lifetime opportunity to create a second impression, and we have to take advantage of it.”
As communities reemerge from lockdown and resume normal activities, the ability to use technology to personalize the in-person shopping experience is a historic shift riddled with opportunity. Sigal has earned trust as a leader through building relationships and creating value beyond what was expected through a traditional owner-merchant relationship. “Sandy always goes the extra mile,” according to Beta’s Richard Rizika. “During the pandemic, NewMark created a greater level of trust between owner and merchant, and they did it on a human level while taking advantage of technology to improve merchants’ ability to not just operate but to survive.”
Sigal demonstrates the need for well-designed and rewarded foresight practice, and he sees a bright future for retail as a force for community engagement. “Invest in ensuring that merchants are equipped to deliver superior experiences,” he says. “In the shopping center space, the only thing that matters is the lifetime value of a customer. The power of information could make this the most profitable time for our retailers. I underestimated the strength, creativity, and ability to adapt shown by our entrepreneurs and small businesses through this time. They did an incredible thing, and it was inspiring.”