12 May, 2020
Even before the corona lockdown retailers in town centres were not exactly having an easy time of it. In recent years the Internet has become no longer a visionary, but rather an actual decisive development motor in retail competition. Companies like Amazon seem to be growing almost exponentially into infinite hemisspheres. Today the capital accumulation made possible by the structures of Internet trade overshadows traditional forms of commerce in urban retail businesses. For the owners of valuable town centre properties this is an ever-increasing challenge. Creative solutions are needed to identify uses which take decisive account of the need for profitabilty as well as longerterm functionality.
Recently the story of one usage on Hamburg`s Jungfernstieg has perhaps taken on an exemplary character. Streit`s film theatre was a practically legendary cultural institution in a prominent exclusive location in the city centre. But still one day the theatre was gone. In times of media transition this relatively complex usage probably no longer represented a very attractive financial prospect for the owner family of the renowned property. Consequently, an apparently more pragmatic, contemporary use was established on the site - enter the Swedish retailer Clas Ohlson and the ostensibly ideal solution of a contemporay small-scale department store. The opening even warranted an appearance by Her Royal Highness Sylvia of Sweden. But despite all the pomp and circumstances, after a guest run lasting about three years and the opening of three further branches, the Nordic retailer bowed out of the Hamburg market. At present the property on the exclusive Hamburg boulevard is home to the dicount drugstore Rossmann. The Streit`s site is a relatively large scale venue for the discounter compared to its other locations. The was forced to vacate its previous rental in the neighbouring Deutschlandhaus because a new building was to be created there by architect Teherani. Did this new location represent a quantum leap for the exclusive Jungfernstieg?
The limited rental income which can be generated from a discount drugstore is certainly well known in the sector. Perhaps the tenant was preapared to make certain concessions in its commmercial policy for this grand location. The drugstore basically took over the space as it was configured by the former tenant, so in all probabilty there is little justification for the high costs of converting a cinema to retail space to be reflected in the rental payments. But at least with this rental yield the landlord has established a "safe bet" for the few years.
Incidentally, classic film theatre is enjoying a renaissance in a newly-built more exclusive version in the Astor Film Lounge in Hafencity. Parallels to the former Stereit`s theatre are inconceivable.
The time of corona ist still ongoing. One of the few economic winners here, if there are any, is the gargantuan Amazon, In this respect it is foreseeable that the owners of the many elegant retail and commercial buildings will have to find other innovative future-proof uses. Uses that should idealy also provide long term stability on the market.