Report on cooperative development between shopping centers and chain brand merchants in China 2013

This report, jointly launched by Deloitte and China Chain Store & Franchise Association (CCFA), was accomplished through our study conducted with industrial macro data, in-depth interviews with industry insiders and quantitative surveys with about 500 completed questionnaires received from shopping center developers, retailers and customers. Based on the above, we analyzed the development trends and patterns of China's shopping centers, factors for success in investment and operation, as well as the development trends in the industry as the concluding remark. The main findings are as follows:

• Shopping centers in China enter into transition growth after "blowout" development
• Investments are flowing into second and third tier cities and third tier cities step into a rapid development period
• Business portfolio is experiencing constant adjustment and experimental business model becomes the development direction
• Community-based small and medium sized shopping centers become the priority of future development
• Conventional shopping centers go digital, the key for cross-channel operation is to integrate the online and offline resources and enhance consumers' shopping experience
• The industry consolidation is accelerating and domestic M&A dominates the market.