Mr Pfeffer, you have worked at Brockhoff for 37 years, marketing retail properties in prime 1A locations. How do you assess the market today?

To answer that properly, you have to look closely at each city. In many places, chain retailers are concentrating on major cities. In Essen, for example, we recently secured a 1,100 m² prime 1A city-centre location for leading Italian fashion brand OVS. In medium-sized and smaller towns, by contrast, it is mainly non-food discounters expanding into the best locations.

How is this development affecting rents for stores and commercial buildings in city centres?

Rents in German city centres have fallen in recent years. Today, we are seeing them stabilise. These rent adjustments have opened the market to new groups of prospective tenants. They create many opportunities for restaurants and cafés that could not have rented at the former levels. In Ahaus, for example, we placed a CAFE & BAR CELONA in a former C&A store in a prime city-centre location.

Do you consider restaurants a viable alternative as tenants?

The shopping street of the future will no longer be exclusively about fashion. A key approach is to create a tenant mix in city centres that encourages people to stay longer, not just shop. City centres need more life, especially after shops close, so shopping streets do not become deserted in the evening.

Can the structural weakness of retail create opportunities to address other challenges?

In my view, city centres offer an opportunity to create much-needed housing. Upper floors are often vacant. If properly refurbished, they could provide homes in central locations. Let us be realistic: baby boomers still support physical retail today. Generation Z, by contrast, has never known a time when you had to leave home to shop. Demand for retail-only space will therefore continue to decline over the coming decades. At Brockhoff, we support city-centre development by helping establish a forward-looking tenant mix.