Our aim through this industry wide consultation is to create a voluntary classification methodology to be used across the industry.

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1 SHOPPING CENTRE/RETAIL PROPERTY CLASSIFICATION CONSULTATION AIM At Revo we believe that a standardised classification for shopping centres would support our objective of creating a common, objective, fairer and more positive vernacular for these assets in the UK, especially in relation to reporting, whether that s by advisors, analysts, the media or investors. Our aim through this industry wide consultation is to create a voluntary classification methodology to be used across the industry. BACKGROUND Currently the only widely used shopping centre classification in Europe and the UK is the ICSC classification. It is used by real estate advisors for market overviews, international comparison studies and statistical purposes. Unlike the ICSC US classification, the European equivalent is focused mainly on the size of the scheme and does not take into account specific characteristics of different types of shopping centres. There is no UK-only classification. At present the UK market largely describes locations as either prime or secondary, which is clearly too broad brush and it does not recognise their specific role in fulfilment of different shopper missions; in effect damning large sections of the market through one negative and subjective word. There is however increasing analysis on this topic and a recognition that different locations fulfil different needs and a more objective description would bring great clarity to describing the purpose of each centre. Given the fast-changing retail environment with increasingly selective/purpose-led customer shopping trips, we believe there is a need to create a classification that would properly reflect the characteristics of retail schemes, which would benefit the entire industry. Adopting international best practice would allow owners, occupiers, agents, valuers and other advisors to use a more widely accepted lexicon to describe the 800+ shopping centres in the UK in objective terms that reflect their purpose. Clearly, adopters of this classification may then wish to describe in any further detailed analysis whether individual schemes are fit for purpose, failing or thriving, etc.

2 At present we have not included retail parks and other generally out of centre locations, as definitions in this part of our market are more consistent and well established. However, this could be revisited in the future. CONSIDERATIONS The number of categories should be limited. The categories should not be too complicated and should take into account key factors such as: Asset function Size Catchment area/drive times Customer use Tenant mix/anchors Non-retail element (leisure, F&B) EXISTING CLASSIFICATION PRECEDENT European classification by ICSC split into traditional and specialty shopping centres. Minimum size of a scheme is 5,000 sqm. In general, further split takes into account size of the scheme only. It is useful for supply calculations and Pan-European/EMEA market overviews; however, it does not provide information on the actual function of the schemes and the role they play in customer journey. They are not informative in terms of pricing either. This type of classification seems outdated. The classification enclosed. US classification by ICSC. A major split to General-purpose centres, specialized-purpose centres and limited-purpose property (airport retail). More detailed classification is based on the asset functionality, typical size, number of stores and anchors, catchment area. This kind of classification seems a better fit for what Revo is trying to achieve. It would need adjusting to the UK/European market. The classification enclosed. Classification used by some of the landlords: Hammerson: Shopping centres/retail parks/outlets Westfield: Flagship and regional British Land: Regional and local

3 Capital & Regional, based on Javelin Group / SHOPSCORE: Functional, Neighbourhood, Community, Community Plus, Regional Mall, Major Mall, Uber Classification used by retail consultancy CACI: Fast centres: The vast majority of these (c.21, 000) are small parades of local shops that serve their immediate neighbourhood. Critical for convenience retailing, most will operate with a 5-minute walk catchment. They typically comprise local services and often dominated by independent traders; Largely they do not trouble comparison retail, although increasingly convenience stores play a role as the last stop in online fulfilment. Aside from this, as a result of their hyper-convenience, they are notably less affected by the growth in online retailing. Fundamental centres: These are the bulk of UK comparison retail and comprise c.8,000 centres ranging from in-town/out of town, high streets and retail parks. They are comparison goods shopping destinations but largely serve their local community. They vary hugely in size and offer and will be home to the vast majority of the UK s comparison retail. They are essential for retailers and are the commonly referred to Great British High Street where most brands will connect most often with their shoppers. Flagship centres: These are the top c.50 centres in the UK in terms of size, scope and offer. They are a mix of city centre and regional malls and are characterised by a strong, often premium, compelling offer with good catering and leisure mix. Shoppers visit these centres for destination shops, and brands will often place flagship stores in these centres.

4 DRAFT REVO CLASSIFICATION: We propose splitting centres into 3 broad categories Regional, Local and Specialised. Within each of these 3 groups we then propose 3 subcategories to provide clarity over purpose and function: Category Definition Typical size Typical Anchors Catchment area/drive time Regional (Schemes serving customers from a larger region/beyond town area) Super Regional Standalone destination shopping centre characterised by exceptional retail and leisure offer, serving large catchment area. Typically anchored by two (or more) department stores. Long dwell times, high footfall, typically used for monthly/quarterly shopping trips. High usage of F&B and leisure offer. 1m sq ft+ 2+ dept. store anchors 1hr+ drive time penetration Mid Regional Principal retail offer in major city centre locations (top 25) or smaller standalone, with strong retail and leisure offer, serving large catchment area. Typically anchored by major department store with strong supporting fashion and well-used leisure offer. Typically used for weekly/monthly shopping trips. 750,000 sq ft + 1+ major anchor stores Up to 1 hr drive time penetration Sub Regional Principal retail offer in large city/town centre locations (ranked 25-50), with strong anchor store and predominantly supporting fashion (wants) focus. Appropriate supporting leisure offer. Typically used for weekly shopping trips. 500,000 sq ft+ 1 strong anchor store Up to 45 min drive time penetration

5 Local (Schemes oriented toward local customers) Community Neighbourhood The principal shopping destination for the immediate catchment, used for daily /weekly shopping trips, with a strong representation from needs based retailers. Likely to be the commercial focus and foremost retailing pitch in the town. Highly likely to incorporate the town s main shoppers car park A centre which constitutes a non-dominant part of the town s wider retail offer, or the dominant retail offer in a smaller catchment, playing an important but not necessary principal role in retailing in the area. 250,000 sq ft+ 0-1 anchor store Catchment typically less than 30 minutes-drive time ,000 sq ft 0-1 anchor store Catchment typically less than 15 minutes-drive time, or pedestrian access Convenience Convenience - easily accessible, serving the daily needs of the direct local catchment. Highly likely to be underpinned by strong supermarket offer. <100,000 sq ft (in addition to anchor store) Typically supermarket anchored Serving just the immediate locality Specialised-purpose centres Outlet Mall London Suburban Transport Hub Specialist that comprises manufacturers' and retailers' outlet stores, typically let on flexible/turnover leases, offering brand-name goods at discounted pricing. Local catchment-focused town centre schemes, 200,000 sq ft+, predominant offer within densely populated area. Retail in public transport networks: airports, railway stations, tube stations.

6 NEXT STEPS This consultation will involve key stakeholders across the industry to debate and agree the objectives, outputs and outcomes of this work, along with the specific language within the classification. We will also undertake a wider survey based consultation to generate the broadest possible input into this important work. Our aim is to conduct this research by the end of July and, subject to feedback, publish our classification in September, most likely at Revo Manchester 2018, which takes place between September. DRAFT CONSULTATION QUESTIONS TO BE ANSWERED: 1. Do you agree our aim of creating a standardised classification would be of benefit to our sector? If not, why not? 2. Do you have any specific comments on the categories, criteria and language we propose? 3. Would you suggest amendments to our descriptions of these categories? 4. Would it be helpful to include centres that we see as good examples under each category? 5. Should we look at all types of managed retail properties rather than just shopping centres, i.e. retail parks? What about town centres /high street? 6. Should the proposed classification be applicable to the UK market only? Or, taking into account the international nature of property ownership, do you think it is feasible to create a Pan-European classification?