Retail (still) has the power to reshape cities

‘Retail is no longer simply about occupying commercial space. Increasingly, it is helping to shape destinations, regenerate neighbourhoods and influence the way people experience cities’.

That was one of the clearest themes to emerge from Retail Real Estate Trends 2026, hosted by COCUZZA in Milan, where investors, developers, designers and retail specialists came together to discuss the changing relationship between retail, real estate and urban regeneration. Here, our country head for Italy, Maria Luisa Daglia, shares some of her key takeaways from the event.

 For me, one of the most interesting parts of the discussion was the shift away from thinking purely about footfall or individual stores, towards the quality of the destination as a whole – something reaffirmed by Paola Macchi, head of retail high street leasing Italy at CBRE, speaking about the growing importance of the quality of pedestrian flows, rather than simply the number of people passing a location.

And that distinction matters, as retailers are increasingly looking for places that give people a reason to stay, return and spend time there – something we talked about in our guide ‘designing for (dwell)being.’

In doing so, it often means creating a broader mix of retail, hospitality, culture, leisure and public space rather than treating the store as an isolated destination, with Manifattura Tabacchi in Florence highlighted as one example of this changing approach – where the wider environment and mix of uses are becoming part of the attraction for brands as well as visitors.

Retail can unlock wider value.

The relationship between retail and urban regeneration came through strongly throughout the discussion, with Milan’s Piazza Cordusio providing a useful example. Traditionally associated more closely with business and offices, the redevelopment of existing buildings created the large-format, high-quality spaces needed by international retailers.

In turn, that’s helped to change the character of the area and attract further investment, while demonstrating how the repositioning of existing real estate can create value beyond the individual building. CityLife was also discussed as an example of how a more integrated approach to development can transform the perception and use of an entire district. For those of us involved in delivering retail environments, there is an important lesson here.

The value of a store is increasingly connected to what happens around it.

The building, public realm, neighbouring uses, accessibility and overall experience all contribute to whether somewhere succeeds as a retail destination – but let’s not forget, not every opportunity sits on a prime high street.

Ignazio Maiorana, director of asset management funds at Prelios, brought a different perspective to the discussion, looking at secondary locations and more complex development environments. In these markets, understanding the local catchment becomes even more important.

Who actually uses the area? How is that population changing? What does the local economy support? And how can the available space be used in a way that creates sustainable value over the long term?

There is no universal retail formula, and an approach that works in central Milan cannot simply be transplanted into another town or district and expected to deliver the same result. Successful development starts with understanding the place, the people using it and the role retail can realistically play within it.

Public space is part of the retail experience.

Another point that particularly resonated was the importance of public space. Alessandro Rossi, associate and projects director at Park Associati, discussed examples including Piazza Liberty and Galleria Vittorio Emanuele II, where the spaces between buildings play an important role in how people experience the destination.

Good public realm encourages people to move differently, linger longer and interact with their surroundings. That has obvious social benefits, but it has commercial implications too because retail does not begin at the shop door.

The journey towards a store, visibility of the façade, relationship between inside and outside and the way people move through a district can all influence the success of a location. For designers, developers and contractors, that means thinking beyond an individual unit and understanding how it connects with the wider environment.

Transformation depends on coordination.

Perhaps the point that connects all of these themes is the need for better alignment between the many organisations involved in changing our cities. Urban regeneration brings together public authorities, investors, developers, designers, retailers, contractors and local communities, often with very different priorities. Successful projects therefore depend not only on a strong vision, but on clear planning, realistic milestones, effective risk management and a shared understanding of what everyone is trying to achieve.

From general contractor perspective, that feels particularly relevant, because a compelling concept still has to be translated into something that can be built, coordinated, programmed and operated successfully. The earlier those conversations happen, the more opportunity there is to resolve competing requirements before they become expensive or disruptive later in the project.

My biggest takeaway from the event was that retail continues to have a much broader role in our cities than the transaction that happens at the till. At its best, it can help breathe new life into existing buildings, create reasons for people to visit an area, strengthen public spaces and contribute to the long-term value of a neighbourhood. But achieving that requires more than securing the right brand or designing an attractive store… it means understanding the destination as a whole and bringing investors, developers, designers, public institutions, retailers and delivery teams together around a shared ambition.