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Germany: Aldi Süd Plans To Expand Business in City Centres

Discount Retail Chain Aldi Süd (family owned) has announced that it plans to expand its operations in city centre areas and is looking for partners to collaborate on this project.

The discounter has created a central contact point for simplifying acquisition and cooperation across its entire distribution area. The move will help forge new partnerships and maintain and support existing collaborations with drugstores, department stores, or other businesses, Aldi Süd said.

Real Estate Market

The move is in response to changing conditions in the real estate market. Cities and municipalities are focusing on using land in a resource-conserving way and creating new living space wherever possible. In addition, they also face the challenge of strengthening the city centres, which are under increased pressure from online retail and COVID-19 restrictions. Against this backdrop, food-anchored properties in integrated locations are becoming significantly more attractive, the retailer noted. "We believe in the city centre," says Jan Riemann, property director at Aldi Süd. "We want to revitalise and develop the city centre to be even closer to our customers. Short distances make shopping easy and reduce traffic congestion in cities." Last year, a group of German associations called for 'creative cooperation' between players in inner-city trade to counter the slump in business due to the coronavirus pandemic.

Regional Commitment

The discounter added that it is stepping up its regional commitment by opening project development offices for Cologne, Frankfurt am Main and Offenbach, as well as for Stuttgart and Munich. These 'local offices' will specialise in the development of mixed-use properties in the respective areas. Riemann explained, "Planning a location with gastronomy, retail and a daycare centre on the roof in the middle of the city is significantly more complex than building a stand-alone branch in the countryside. That's why we bundle our expertise." Riemann added that Aldi Süd would function as "advisors and idea developers" and stated, "Together with our partners, we want to develop properties that meet urban development requirements and create added value for all users. What counts for us is the long-term perspective, and for that, the focus is on flexible development with the right mix of users."

Store Development Strategy

The opening of these offices is part of a realignment of Aldi Süd's store development strategy. The discounter is also strengthening other functions such as marketing, management of large real estate projects, and support for supra-regional cooperations. "We are investing in cooperation with cities and municipalities, investors, project developers, asset managers, brokers and architects," Riemann added. "We want to be the first point of contact for them when it comes to realising food-anchored properties."

See here for more: Aldi Süd Plans To Expand Business In City Centres | ESM Magazine

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