Neighbourhood malls recorded a higher rebound in retail sales and footfall in Q3 2020, as consumers moved from enclosed malls to more convenience-based, open-air neighbourhood malls.

This trend can be attributed to consumers being fearful of excessive human engagement, shopping closer to home due to work-from-home patterns and the closure of entertainment venues, cinemas and gyms that traditionally anchor large enclosed malls.

According to Knight Frank, the outbreak of Covid-19 has certainly slowed down retail development activity across the continent.

However, due to the localization of retail demand, convenience and neighbourhood retail sectors have started to see increased levels of development activity and interest.

The growing trend towards neighbourhood malls has been further driven by increased relocations of people and businesses from city centres to the suburbs, resulting in an increased concentration of retail demand.

Even though increased economic activity in towns has underpinned the growth of and performance in neighbourhood malls and retail centres, informal retail continues to dominate the retail sector in the majority of markets in Africa.

The Africa report released yesterday shows that certain retailers recorded relatively strong performance despite the economic and mobility challenges posed by Covid.

In Kampala and Nairobi branded fashion retailers have on average tripled their sales turnover compared to pre-Covid levels.

These sharp increases have been underpinned by pent-up consumer demand and redirected demand as a result of the international travel ban, with a significant portion of this demand favouring international brands.

“For all its perceived devastation, Covid-19 has not actually brought anything new to the table. It has merely accelerated processes of change and evolution that were already underway. In less mature markets, it has reinforced the need for modern, fit-for-purpose retail floorspace and will ultimately, when the dust settles, kick-start a fresh wave of development,” said Stephen Springham, Head of Retail Research for Knight Frank.