The placemaking industry faces several challenges in 2024, with key factors being influenced by inflation, interest rate dynamics, and changes in consumer spending habits. The uncertainty surrounding interest rates is impacting developers and investors, leading to a pause in new projects. The geopolitical situation is also causing concern. Despite these challenges, the residential market remains a bright spot at this moment, driven by the demand for housing within the middle class, across Europe.
The current economic situation, marked by changes in consumer behavior due to inflation and interest rates, presents opportunities for businesses that provide value. Outlets focusing on affordable and quality products, businesses that sell value in food, flights, and apparel, are likely to perform well.
The residential market is a consistent opportunity, driven by the need for housing. However, the industry needs a clearer understanding of the capital market, banks, and interest rate dynamics for investors to commit confidently.
The post-COVID era has seen a return to physical retail as people seek a more engaging and enjoyable shopping experience. There is a shift in expectations across various sectors, including shopping, residential, and offices. Consumers now expect more from their environments, emphasizing the importance of providing meaningful spaces, entertainment options, and quality customer service.
Therefore, it is important to focus on understanding and meeting customer needs, regardless of the industry. Delivering what customers want is crucial for building loyalty and ensuring repeat business.
Recognize the challenges of finding motivated staff in service areas and adapt to the preferences of new generations interested in remote working policies and other benefits.
Emphasize delivering above and beyond customer expectations. In both retail and real estate, prioritize quality over cost savings to create long-term value for customers.
In the face of economic uncertainties, remain flexible, motivated, and innovative, and consider unique offerings such as shared working spaces, sports facilities, relaxation spots and other amenities to differentiate your projects.
In summary, the placemaking industry is navigating challenges related to economic factors and geopolitical uncertainties. However, opportunities exist for businesses that focus on providing value, understanding customer needs, and delivering high-quality experiences in both retail and real estate.
Brendon O´Reilly
Brendon O´Reilly is Managing Director at FASHION HOUSE Group.
