Good morning, Fridays tend to make us reflect on the events in the past.
Take New Zealand's housing crisis, for example, which can only be solved by making its cities more dense - a complete departure from our lifelong advocacy for open, sprawling spaces around single houses.
Even horns-locked-forever retailers and mall operators seem to have analysed the past and decided to bury it for a collaborative future. While cinema halls are still stuck in reverse, without much recovery.
Ginger Chai readers have had an awesome week though, and we wish all of you a good read today and a great weekend ahead.
More Urban Density Please
New Zealand's cities are facing a crisis. One that its residents are choosing to brush under the carpet, making their own futures more complicated.
What's Wrong?
Housing affordability. Actually, the situation has gone well out of control and except the rich and settled, common folk are not being able to live in many of New Zealand's cities anymore.
And there is good reason. In 2019, New Zealand's city Tauranga was in the top-10 list of the world's most unaffordable cities. Hamilton became more expensive than Brisbane, though wages in Hamilton are 30% lower in comparison.
Queenstown became more expensive than Melbourne and Auckland is pretty much out of reach for most New Zealanders.
But Why?
A seductive, seemingly innocuous policy is responsible for this disaster - the single dwelling unit, defined as a single dwelling not attached to any other dwelling or structure (except its own garage or shed).
In layman's terms, bungalows with sprawling lawns, backyards, the works.
While that might sound harmless, cities in New Zealand have declared outskirts around all major cities as single dwelling unit zones.
So, to live there, you need to be able to afford a bungalow, or stay out.
Has The Trend Stopped?
Quite the opposite. The single dwelling zone stands by uninterested and unmoved. In fact in most cities, it's growing.
In Auckland, 36% of all residential land within a 5km radius of the city centre is zoned single dwelling. In Tauranga, the number is a 🤯 91%. 👀 - Mumbai and Delhi.
Where's It Going?
With land prices going 5x in some New Zealand cities in just a span of 20 years (compared to a 2x wage growth only), the sinister nature of the single dwelling policy has contributed to a toxic mix of rapid house price growth and costly transport receipts, as infrastructure solutions attempt to jump large swaths of bungalow living.
Is There A Work Around?
Geoff Cooper, PWC, feels that our cities are no longer exhibition halls but collages. Only policies that encourage flexibility open our cities to the possibility of spaces that are constantly improved upon, reinvented and reimagined.
Without flexibility, there is no modern New York, no reinvented Brooklyn, no waterfront Vancouver.
Cities need flexibility to evolve and our policymakers need to give it to them.
Nope. Not Yet.
People are back in shopping malls. Egged on by the festive season, a solid vaccination drive, and an economic revival, people in malls are also shopping, eating and drinking.
But they are still not going into the cinema halls.
Yeah?
Yes, rummaging through retail trends, we found that while retailers in prominent malls are now back to 80% - 90% business levels compared to September 2019, cinema chains are at a mere 10% - 15% of September 2019 revenues.
Why?
Lack of good stuff to watch.
Though people are moving out and getting social once again, inspired by one of the world's largest and most effective vaccine drives, there is nothing screening which is worth buying that cinema ticket for.
Now?
The grapevine says that since cinemas opened in July, hope came when a few movies like Bell Bottom were released and did well at the box office.
Now, all hopes are pinned on Sooryavanshi's release and insiders believe that in a year's time, things should be back to normal for the big screen business.
Half A Cup Extra
- Co-working firm IWG has signed one of its biggest franchise deals with Conjoinix for 18 co-working centres across Delhi NCR, Haryana, U.P., Jammu & Kashmir, and Gujarat.
- An 11 member committee, headed by MP Kirron Kher is kicking off its first meeting to review and streamline property services in Chandigarh.
- Indians are using overseas real-estate markets to hide their wealth, says GFI director.
Collaborate Or Perish
Mall operators and retailers have always been in a love-hate relationship, garnished with liberal amounts of ego from both sides.
But with the pandemic battering both like never before, it seems necessity is the mother of all invention collaborations.
Context, Please.
Since April 2020, shopping malls have been shut on and off, first sparking a big rent payment row between mall operators and retailers, then moving on to showdowns, and ultimately ending in a state of forced understandings.
Both retailers and mall operators now understand that disruption is part of life and they must work together to make each other's lives more predictable, and thus easier.
Is There Real Change?
Yes, to a large extent. For the first time, a true sense of partnership between the two sides has developed and become more stable after the second lockdown, industry veterans feel.
Mall operators finally got to know retailers more closely during the pandemic crisis. Negotiations on all areas of concern thus took place amicably, and solutions suiting both sides have been reached.
To increase footfall and revenue, malls are now actively discussing their marketing programs with the retailers and similarly, retail brands are also sharing their plans with mall operators.
Going Forward?
Retailers - Retailers and food chains, the biggest footfall drivers for shopping malls feel that the post COVID shopper has changed in many ways and mall operators must also make significant changes - like creating food delivery outlets on the ground floor, resizing stores and the retail mix, and introducing innovative pricing.
Mall Developers - Mall operators feel that the key to revival lies with retailers unlocking their consumer databases, which would enable them to jointly launch marketing campaigns with the concerned retailers to target and woo shoppers.
Both - All sides agree that e-commerce is a huge threat to both malls and retailers, primarily due to their speed, service and consumer engagement policies.
And likewise, retailers and mall operators should adopt similar strategies, because only customer service and personalised interaction can help bring back customers to malls.
In One Sip?
N. P. Singh, Samsonite South Asia, puts it aptly, "Malls and retailers must co-exist, and this should be the biggest factor in determining the next step."
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Paypal, in its quest to become a super app like Alibaba, is in talks to acquire Pinterest, at a value of US$ 45 billion.
If the acquisition goes through—though just like our Friday plans, it could fall apart without notice—it would be one of the biggest consumer internet takeovers in years, topping Salesforce’s $27.7 billion purchase of Slack in 2020.
See you on Monday morning.
☕ The Crew@Ginger Chai