The commercial landscape is undergoing a profound transformation, where traditional boundaries between different sectors are becoming increasingly blurred. Nowhere is this more evident than in the commercial, hospitality, retail, hotel and F&B integrations that we now see so commonly amongst developments. These new-to-market, hybrid spaces not only provide enhanced experiences for customers, but also offer significant advantages for property owners, developers and businesses alike.
A single-location, holistic experience
The rise of the digital age has drastically altered the expectations of today’s customers. Convenience, personalization and engagement have become key drivers of consumer behavior, forcing developers to rethink the traditional siloed approach to commercial spaces. Instead of offering a single service or product, there is now a growing trend to provide a holistic experience in one location.
A key example of this convergence is the integration of hotels with retail and F&B services. Previous distinctions are fading as businesses recognize the benefits of creating multifunctional spaces.
Many hotels now feature high-end retail stores, gourmet restaurants and on-trend bars, under one roof. In certain circumstances guests are even choosing the hotel based solely on its F&B provision. The benefits of this integration are twofold: for guests, it provides convenience and a richer experience without having to leave the premises; and for hotel owners, it increases foot traffic, enhances brand value and opens up new revenue streams. Hotels are partnering with high-end fashion brands to create in-house boutiques. They are also collaborating with renowned chefs to open signature restaurants which often become attractions in their own right.
A crucial role for F&B
Retail is another sector undergoing significant transformation. With the rise of e-commerce, brick-and-mortar stores have had to adapt to stay relevant. Many retailers are now focusing on creating immersive experiences that cannot be replicated online. For instance, some high-end department stores now feature services such as personal shopping assistants.
F&B outlets have also become crucial components of mixed-use developments, in many cases, acting as anchors that draw people into retail spaces or hotels. Food halls, in particular, can help to create a lively atmosphere which, in turn, benefits the other businesses within the space by increasing foot traffic and dwell time.
Generating diverse revenue streams
The merging of hotels, retail and F&B offers substantial advantages for property owners and developers. By combining different functions within one property, owners can generate multiple revenue streams from the same asset.
Importantly, hybrid spaces are better equipped to adapt to changing market conditions. For example, during economic downturns, when retail sales might decline, the F&B and hospitality components can help offset losses. This diversification of revenue streams makes the property more resilient and reduces the risk for owners and investors. From the customer’s perspective, the merging of hotels,
retail and F&B represents a new level of convenience and engagement, providing an appealing, integrated experience for both visitors and locals.
Careful planning a must
Admittedly, merging hotels, retail and F&B also presents certain challenges. These include ensuring a seamless integration of the different elements and that they remain ‘brand aligned.’ The design and layout of the space must be carefully planned to create a cohesive and enjoyable experience for customers, requiring collaboration between architects, interior designers and brand managers. Staying relevant and authentic in a rapidly changing market is another challenge, requiring regular updates, renovations and new experiences to keep customers engaged and returning.
As consumer expectations continue to evolve, we can expect to see even more innovative concepts that push the boundaries of what commercial spaces can offer. Technology will play an increasingly significant role in everything from smart designs and personalized services to digital experiences.
How to reinvent commercial spaces for added value
Bringing hotels, retail and F&B outlets together in a multifunctional space can be beneficial for visitors, owners and investors alike. Duncan Fraser-Smith, CEO of Craft Hospitality Group, tracks the rise and rise of the commercial, hybrid space.
The commercial landscape is undergoing a profound transformation, where traditional boundaries between different sectors are becoming increasingly blurred. Nowhere is this more evident than in the commercial, hospitality, retail, hotel and F&B integrations that we now see so commonly amongst developments. These new-to-market, hybrid spaces not only provide enhanced experiences for customers, but also offer significant advantages for property owners, developers and businesses alike.
A single-location, holistic experience
The rise of the digital age has drastically altered the expectations of today’s customers. Convenience, personalization and engagement have become key drivers of consumer behavior, forcing developers to rethink the traditional siloed approach to commercial spaces. Instead of offering a single service or product, there is now a growing trend to provide a holistic experience in one location.
A key example of this convergence is the integration of hotels with retail and F&B services. Previous distinctions are fading as businesses recognize the benefits of creating multifunctional spaces.
Many hotels now feature high-end retail stores, gourmet restaurants and on-trend bars, under one roof. In certain circumstances guests are even choosing the hotel based solely on its F&B provision. The benefits of this integration are twofold: for guests, it provides convenience and a richer experience without having to leave the premises; and for hotel owners, it increases foot traffic, enhances brand value and opens up new revenue streams. Hotels are partnering with high-end fashion brands to create in-house boutiques. They are also collaborating with renowned chefs to open signature restaurants which often become attractions in their own right.
A crucial role for F&B
Retail is another sector undergoing significant transformation. With the rise of e-commerce, brick-and-mortar stores have had to adapt to stay relevant. Many retailers are now focusing on creating immersive experiences that cannot be replicated online. For instance, some high-end department stores now feature services such as personal shopping assistants.
F&B outlets have also become crucial components of mixed-use developments, in many cases, acting as anchors that draw people into retail spaces or hotels. Food halls, in particular, can help to create a lively atmosphere which, in turn, benefits the other businesses within the space by increasing foot traffic and dwell time.
Generating diverse revenue streams
The merging of hotels, retail and F&B offers substantial advantages for property owners and developers. By combining different functions within one property, owners can generate multiple revenue streams from the same asset.
Importantly, hybrid spaces are better equipped to adapt to changing market conditions. For example, during economic downturns, when retail sales might decline, the F&B and hospitality components can help offset losses. This diversification of revenue streams makes the property more resilient and reduces the risk for owners and investors. From the customer’s perspective, the merging of hotels,
retail and F&B represents a new level of convenience and engagement, providing an appealing, integrated experience for both visitors and locals.
Careful planning a must
Admittedly, merging hotels, retail and F&B also presents certain challenges. These include ensuring a seamless integration of the different elements and that they remain ‘brand aligned.’ The design and layout of the space must be carefully planned to create a cohesive and enjoyable experience for customers, requiring collaboration between architects, interior designers and brand managers. Staying relevant and authentic in a rapidly changing market is another challenge, requiring regular updates, renovations and new experiences to keep customers engaged and returning.
As consumer expectations continue to evolve, we can expect to see even more innovative concepts that push the boundaries of what commercial spaces can offer. Technology will play an increasingly significant role in everything from smart designs and personalized services to digital experiences.
Duncan Fraser-Smith,
founder of The Craft Hospitality Group
Author of “Create to Plate”
@duncanfs
@crafthospitality.group
duncanfrasersmith.com
crafthospitality.group
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