Alberto Esguevillas is the UK CEO of Eurofund Group. Operating across Spain, Portugal, the UK and Italy, the group first established themselves as experts in creating retail destinations, although they have since expanded into other sectors. In 2022, they acquired West Scotland's premier shopping destination, the Silverburn Shopping Centre in Glasgow, marking Eurofund's first move into the UK market.
Ahead of our 27th Retail and Leisure Trends Summit, where he will be joining us as a panellist, we spoke to Alberto about the Silverburn acquisition, the particular strengths of the UK and European markets, and how data and insights play a key role in Eurofund's strategic activities.
What attracted Eurofund to Silverburn as an investment?
What attracted us to Silverburn as our first investment in the UK was the fact that it’s quite a unique asset—in particular the quality of the asset is fantastic. In a context where retail was just coming out of COVID and habits and ways of consuming were rapidly shifting, we saw Silverburn as a centre that would stand the test of time and continue to be a destination. There was plenty of work to be done, plenty of exciting things to be changed, amended, improved and elevated, but the bones of a fantastic destination were there, and that’s what attracted us to it.
Glasgow is a great metropolis and the second biggest retail catchment in the UK. Silverburn is well placed to capitalise on that and become the leading destination there. We’re convinced of its ultimate potential, and we are steadily delivering on it.
What can the UK market learn from developments and trends across Europe?
Retail globally is continually shifting, but I think the speed of that change has been accelerated.
Whereas previously in the UK retail destinations were traditionally focused on the fashion element, European destinations have a broader mix— not only within the retail element, but also including leisure and other uses. I think that’s something that’s already been happening in the UK, but it’s accelerated with the demise of some of those department stores and big boxes within those destinations. Now these destinations can pivot to providing more leisure, healthcare, residential or other new uses.
Destinations are becoming a lot more mixed-use and they’re becoming more experiential. Twenty to thirty years ago, a mall would be a wide empty corridor with not a lot in it, apart from the retailers on the sides. That’s changing. I think Westfield led the way with the event spaces and animating and activating those destinations. I think that will continue to happen and happen in many more places.
I don’t like the words “shopping centre”. I like to say they are destinations; they are city centres—they’ve just been formed more recently than the Roman city centres of old.
What’s exciting about the UK market and the current climate for retail?
We love the UK market. I’ve been here for 18 years, so probably I’m not the best-placed to talk about that, but the UK market is very sophisticated in terms of retail and shopping: I would say it’s probably the most sophisticated of the European markets in that sense. The consumer and the industry are on a level of sophistication which is very significant.
At the same time, there’s been so much change happening and the industry has gone through quite a difficult time. But that brings a lot of opportunity. There are many, many destinations that are very good, that have been under-invested, that have been under-managed, that have not received the care and the attention that they need. If you can come in now and the pricing has adjusted— you can buy at the right price, invest further capital, put in the energy, the experience, and the leadership to take those destinations into the new world. I truly believe the opportunities are immense.
Which existing UK schemes or developments do you think are especially successful, and why?
Our core strategy is focusing on the top 25-30 assets in the country, but there are also successful assets that operate on a more local level, on a more convenient and local community level. There are many town centres that are also being transformed, where the amount of fashion retail is reducing, and other uses are coming in. And I think that’s also a good thing for our city centres and for our way of living. In that sense, where we were talking about Europe and what we can bring from Europe— [now in the UK] you have retail, you have food, you have leisure, you have entertainment, you have offices, you have a little bit of everything. And that’s how the more compact city centres in Europe are. That’s a good thing: it’s going to make them more interesting places to be and socialise.
I think the Westfield assets are very successful, Bluewater, the Trafford Centre. There are these prime assets that are all evolving and I think it’s a good thing. I think they will look very different in five years’ time. And that’s really good for the industry and for all of us as consumers.
Looking ahead, what do you think are the key trends that we’re going to see across the UK retail and hospitality spaces moving forward?
People don’t just go to buy fashion at shopping destinations any more. They want to spend their time wisely. When the consumer wants instant access and you have retail in one place and food in another and leisure elsewhere, it’s very difficult to make that happen in a good way. So, mixing those uses. That’s what the evolution is going to be. You’re going to go from McDonald’s to your Ibis in these destinations, and you will have leisure right there.
The cinemas are going through a bit of a difficult period at the moment, but there’s some of the competitive socialising that is booming and providing experiences to people.
It’s a bit like a cake. The first layer is the retail, then F&B and leisure, but then you’re going to have other layers, including offices, residential. For example, at UBBO in Lisbon we have a 15,000 square metre hospital in our centre, and it’s working incredibly well. It’s the best waiting room of any hospital in the country— it’s our shopping centre!
Other uses like that, as well as entertainment and events are going to become ever more important. Having that flexibility of thought with any use is important.
What role do data and insight play in Eurofund Group’s strategic activities?
I think data in all its forms is key in what we do. As an industry, we haven’t been the best collectors and users of data for many reasons. In a world where data is so much easier to collect and so much easier to analyse, we should be basing a lot more of our decisions on data.
We use data to select the assets, assess the assets, put together the business plans, understand our customers and clients— both tenants and visitors— and put together our marketing plans. There’s a whole range of data we collect, analyse and use in many different ways. It’s really important that we do more and more of that.
Understanding your customer and social demographics, how many, who, how do they shop, how much do they spend, how often— that’s key not only for the marketing, and trying to entice them into the asset, but to define the mix. Do you need a hospital there, or not? Do your customers really have a need for that, or something else? Would have rather have something more leisure-orientated? How do your customers travel to you? How many of those customers are families? All of these questions are really important, and they must be informed with data.
Is there anything else you would like to add?
I think the industry’s gone through a difficult time, but at the moment the retailer and consumer behaviours are very positive.
The demand from retailers is as strong as we’ve seen in the last 12 months, as strong as anything I’ve seen since 2015-16. In our first year of joint venture ownership at Silverburn we have delivered more than 30 deals with new and existing retailers. Retailers have gone through COVID, and the ones that have gone through it have come out stronger, at least in the big destinations (and that’s what we’ve seen in Silverburn).
Similarly, with consumers, we were all apprehensive that the cost of living crisis, this 10% inflation would destroy consumer confidence and reduce turnover, but actually it hasn’t materialised. So that’s very positive. As an asset class, I think we have the right foundation at the moment and from here we’re very keen to continue to expanding because of that.
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