Adam Schwegman with General Growth Properties explores the intersection of real estate and food.

What does it take to bring a food or drink concept to a mall, food hall, or other major retail development? You need to impress Adam Schwegman, the corporate vice president of eat and drink for General Growth Properties. GGP has 127 retail properties, mainly malls, from Maine to Hawaii. “My team is tasked with bringing unique food and beverage offerings to all of our properties,” he said. 

Schwegman was able to create his role and build out his team after a career in both restaurants and real estate.

“I was a very picky eater growing up, and getting in a commercial kitchen really is what exposed me to food,” he said. “It somewhat correlated with the rise of The Food Network and eating more healthy, whole foods. Food in our culture has really become one of the centerpieces of pop culture over the past 18 years.”

The shift is evident in recent developments. Instead of fashion retailers, agencies are looking at food and entertainment options as anchor tenants.

“Part of it is America’s buying habits and the rise of ecommerce, fast fashion and we were getting a little overweighed in the apparel sector,” said Schwegman. “Luckily we got a jump start on food and beverage, and over the past five years have almost doubled the percentage of food in our properties. So that’s taking a little bit away from apparel and other categories.”

One of the big reasons restaurants are getting a larger piece of the portfolio is simply because you can’t get good food online yet, Schwegman said. Sure, you can order food through a variety of apps like UberEats and Postmates, but if you’re looking to go out with friends, have a good meal and socialize, you have to be at a restaurant.

“That also sort of points to an evolution of not just eating, but entertainment, being entertained, creating these sort of hubs of activity that people want to go to. You hear ‘sense of place’ thrown out a lot, but it’s becoming more and more important as you’re trying to differentiate your property from other properties or places,” he said. 

So you want to get in on an entertainment hub—what’s next?

“First I would just say, be transparent, it’s just really a phone call.” Schwegman adds to engage a knowledgable broker because they can bring credibility to the table. “We are a good growth vehicle. If your brand is a couple units and you have much larger aspirations, it’s better to talk to us sooner rather than later. There’s a lot of regionals that we’ve done multiple deals with that are a mutual success story.”

The problem is jumping too fast. There are some common mistakes you see when you’ve been in the industry. “Well I’ve got a list as long as Santa Clause, but I would say some of my top would be don’t jump too far in geography out of the gate, make sure you have plenty of working capital and contingency because these things are always more expensive than we think, and don’t grow too fast to where you get your eye off the ball and your quality of service and food suffers. Those would be my top three,” said Schwegman. 

The latest trend Schwegman is noticing in the field are micro food halls, spaces around 8,000-square-feet and has three or four units. The second would be mixing coworking spaces with restaurants and even entertainment. “I think there’s just going to be a lot more of mixing between all these different product types to where you may not know exactly where you’re at, but you know it’s an awesome place and there’s a ton of people there,” Schwegman said.

By | 2018-03-23T14:35:59+00:00 March 23rd, 2018|Adam's Blog|Comments Off on Adam Schwegman with General Growth Properties explores the intersection of real estate and food.