Lars Ove Løseth, 27, took over the management of this new Alti mall this summer. The company is now expanding to include two new centers in the administration, making it the third largest group in the country.
– Yes, we are number three now, Løseth tells E24.
A few months after launching the new Alti retail chain, Løseth has clearly set a target, which he declared this summer to become the third largest trading group in Norway.
In October, Alti took over Jærhagen and Bystationen and will receive a total of 20 centers. There is even a Scala group, but Alti has more traffic.
– Jærhagen is a large and beautiful hub that has been recently renovated and will be the second largest in our portfolio. We have a close relationship with the Sandnes town station with those who own the center, Løseth says.
Alti is the result of the demise of the Løseth family of Olav Thon Amphi Centers earlier this year to build their own chain.
Thon is behind Norway's clearest shopping mall portfolio, followed by Finland's Citycon.
In addition to Alna, which is by far Alta's largest center under management, most centers are located in the districts.
It grows further
Løseth and Alti have ambitions to grow further.
"There are certainly some good opportunities. We are not imposing a penalty," says the trade heiress who learned from Olav Thon while studying in Oslo.
It also emphasizes that the chain has not set specific goals or figures to be achieved.
Alti is owned by the Løseth family, which was recently run by merchant niece Lars Løseth (senior). In addition, the Sørbøe family from Arendal owns 20 percent of the Alti Group.
– The fall is news of liquidations and bankruptcies in retail trade, is it time to focus on shopping mall business?
– It would be weird to hold on to if we didn't have faith in it, so yes, we have a lot of faith in the trading industry, but it's, as I said before, an industry in rapid change. And I think the concept of the mall will turn around over time, ”says Løseth.
The trend is for shopping malls to increase the number of dining and dining experiences and to reduce the number of stores. It has also been noted in recent years that shopping centers are increasingly seeking health services as part of their offer.
economies of scale
Scala, which now has to share third place with the Alti chain, doesn't care how big they are compared to other chains, but Scale chief Hans Jørgen Mørland says size certainly doesn't matter.
– It doesn't matter if we are the third or fourth largest shopping mall chain, but there are obvious economies of scale in this market, Mørland says, adding:
– Size allows you to build a professional organization and attract attractive stores. There are also several leases with the same chain of outlets for a position in the market.
He says that from a cost perspective, you also get a number of economies of scale from purchases and major agreements, such as electricity and security, which is a big expense for farm owners.
Another important advantage is learning synergies between centers.
"If the center manager does something clever in Kongsberg, then he might as well work in Hønefoss," Mørland says.
Although Scale boss himself says he doesn't care how big they are compared to other players, the chain has several development projects that can bring the company back to third place. Scala is owned by Norgesgruppen (41.8 percent), Schage Eiendom (24.2 percent) and Fredriksborg AS (33.9 percent).
Real Estate Industry Formula 1
The number of physical stores in Norway has been declining for several years in a row, and Mørland believes many point to the wrong causes of bankruptcy and industry closures.
– Much of the unrest and grocery shopping that the media calls is not driven by increased e-commerce, but by massive over-establishment initiated by store operators and farm owners themselves. When a company that owns its second PE fund raises the top line with an increase in stores in 2019, things quickly go wrong.
Mørland explains that it is as important as economies of scale to understand the Norwegian market, and the specific geographical structure and pattern of trade, which is different from trends in Europe in that we live scattered and trade often and unevenly.
– This is a lot of strangers hard to understand.
Mørland says having a difficult time trading has changed what it means to run as a real estate player.
– You have to be excited about the mall right away, it's the Formula 1 real estate industry.