Physical retail stores in had a “good future” regardless of the arrival of Amazon, according to the chairman of the retail property group Vicinity Centres, Peter Hay.
It was “perfectly possible” for people to do all of their shopping on the Internet today, Mr Hay said, and yet good n shopping centres were doing really well.
“One of the great surprises to me over the last 20 years is how slow the take-up of Internet purchasing has been, it’s an amazingly low percentage of all sales, given that my children started buying on the Internet 20 years ago. And I thought ‘Oh well, the shops are dead you know’. But that hasn’t happened and I now believe that it won’t.
“There’s a real role for physical retail, which shall continue to be pretty vibrant,” he said.
Vicinity owns some of ‘s best retail property including half stakes in Melbourne’s Chadstone and Emporium centres and outright ownership of Sydney’s Chatswood Chase.
Mr Hay’s comments came a day after Amazon’s n country manager, Rocco Braeuniger, told a suppliers’ summit in Sydney that Amazon’s starting date in was “getting really, really, really close”.
Mr Braeuniger said Amazon would be hosting third-party retailers on its online marketplace, and would also be selling products itself out of its first n warehouse, a 24,000-square-metre warehouse in Dandenong South, in Melbourne’s outer south-east.
n analysts predict that Amazon will start taking orders here before Christmas.
Asked what kind of impact Amazon would have on n retailers, Mr Hay said: “My view is that Amazon will have an impact, and we don’t know what that impact is going to be yet. In some jurisdictions there’s been a fairly slow acceleration of take-up of Amazon, and like platform providers.”
Mr Hay said the current “American experience” for retailers was that “the weaker centres are a bit more troubled, that may happen here. But I actually think that our portfolio is looking pretty strong”.
He also described n retailers as being as vibrant as any in the world. “The retail offering in is astonishingly good really. If you go overseas shopping you work out pretty soon that everything you can buy overseas you can buy here,” he said.
On the current retail trading environment, Mr Hay acknowledged that weak wages growth in was having an impact on the retail sector.
“I think it’s a real factor, yes. I think it’s got to have some effect,” he said.
Mr Hay, who is also a former director of Myer, declined to comment on the current turmoil engulfing the famous n retailer.