Retail Owners Look to Fountains to Provide Intangible Gains (7/7)
Jul 7, 2009 6:04 PM, By Riccardo A. Davis
The $43 million fountain outside Las Vegas' Bellagio casino features elaborate water shows synchronized with classical music that attract daily crowds along the Strip.
In the race to drive customer traffic in the current environment, shopping center owners are looking for every way they can find to differentiate their centers from competitors' outlets. To that end, an old standby, mall fountains, are enjoying a resurgence in both indoor and outdoor settings.
One draw is that fountains can serve as gathering places in retail properties—an added amenity that can entice potential shoppers. Water features can also be incorporated as play areas for children—something that may enable parents to spend more time (and hopefully more dollars) at retail properties. Lastly, some owners say that fountains can even lead to increased sales by creating a more enjoyable ambience for shoppers.
Santa Monica, Calif-based regional mall REIT Macerich has conducted annual studies every fall since 2004 surveying more than 7,000 shoppers at its 72 centers that seek to identify elements that draw and keep shoppers coming. Based on that data, the company is convinced that fountains can play a role in increasing sales. According to the surveys, shoppers identify fountains along with attractive tenant mixes, mall cleanliness and safety as key contributors to positive experiences.
"There is a very distinct line to increased sales," says Ken Gillett, senior vice president for property management. "Our findings show that the customers who have a positive experience spend $25 more per visit. … Today, given the economic climate, creating the right atmosphere is more important."
That data played a role in the company's decision to employ a wall fountain on a new parking deck at its shopping center The Oaks, in Thousand Oaks, Calif. There, water cascades down a colorful mosaic of tiles. It deadens the noise of passing vehicles and helps establish the overall ambiance of the center for its shoppers before they even set foot inside the center.
People are drawn to shopping centers with water features because of humans' biological relationship to water, argues Teresa Powell-Caldwell, vice president of business and project development for WET, the Sun Valley Calif.-based firm, which designed the opulent $43 million fountain outside Las Vegas Bellagio's casino. That fountain features elaborate water shows synchronized with classical music and attracts daily crowds along the Strip. "The experience creates positive emotions and you can't ask for anything better than that in a retail environment," says Powell-Caldwell. "Retail is about creating a destination."
Not Convinced
The fountain at Taubman Center's Mall at Short Hills, in Short Hills, N.J. received more than $30,000 in coins 2008. The funds were distributed to local charities.
Other owners are less convinced that fountains lead directly to greater sales, but do think they play an important role in setting an atmosphere.
Columbus, Ohio-based Glimcher Realty Trust has fountains at 30 percent of its portfolio. Jed Reichard, vice president and regional director of properties, says it can be hard to measure the value. And the trade-off is that water features can take up valuable selling space. At its River Valley Mall in Lancaster, Ohio, for example, Glimcher has contemplated eliminating its fountain to free up more space for kiosks. "We're always looking to maximize the revenue we generate from the common area," says Reichard.
Glimcher's evaluation process includes looking at the fountain's age, its replacement cost, whether it has a replacement tenant lined up and whether some other use would be better suited for the space. For example, in 2003, at Ashland Town Center, in Ashland, Ky., Glimcher did end up replacing an older fountain with a soft play-area for children.
Dave Harris, a regional vice president for operations with Bloomfield Hills, Mich.-based Taubman Centers also thinks fountains' benefits are hard to measure. "There is no linear correlation," Harris says. "Anecdotally, customers say that the soothing experience [resulting from the presence of a fountain] is what they want when they come to a mall."
For its part, Taubman does have fountains at 81 percent of its portfolio and eight of its properties have two or more water features. For example, its Mall at Partridge Creek, in a Detroit suburb, has a pop-jet fountain that draws children along with two other fountains.
That gets at one potential benefit. Some developers, including CBL & Associates Properties argue that fountains can actually be more popular with children than traditional play areas. For example, its Pearland Town Center, located near Houston, Texas, includes a popular pop-jet fountain that children play in during the summer's hot months. It adds to the overall ambience of the center and provides a place for families to linger.
