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Building retail
Building retail tenant trust: tenant trust
neighbourhood versus regional
shopping centres
597
Jane Roberts, Bill Merrilees, Carmel Herington and Dale Miller
Department of Marketing, Griffith University, Gold Coast, Australia

Abstract
Purpose – Trust is the basis of business relationships. The purpose of this paper is to explore the
antecedents of trust in the context of the relationship between shopping centre management and retail
tenants, primarily from the retailer perspective, as a first test of trust in such business-to-business
relationships. A contrast is made between neighbourhood and regional centres to determine if centre
size affects trust development.
Design/methodology/approach – Quantitative research methods are used. The focus is a sample
of 201 retail tenants in Australian shopping centres. Psychometric properties were assessed for all
multi-item scales used to capture variables of interest. Multiple regression analysis is used to explain
trust in terms of five key influences: power of the centre manager (as a negative relationship),
empowerment of the retailer, flexibility, responsiveness and the shopping centre brand.
Findings – Empowerment, restraint of power and responsiveness are the main determinants of trust.
Power is especially critical in regional shopping centres. The shopping centre brand and flexibility
play important support roles in neighbourhood centres.
Research limitations/implications – The lack of comparable studies limits the generalizability of
the results to other countries.
Practical implications – Centre managers, in larger planned shopping centres, who want greater
retail tenant trust, should not demonstrate their power overtly in, say, rent negotiations. They could
also learn from small centres about being flexible and projecting a more unified centre brand.
Originality/value – This empirical study probes the antecedents of trust in Australian shopping
centres, a previously neglected area in the shopping centre literature. The paper is unique because it
contrasts neighbourhood and regional shopping centres.
Keywords Australia, Shopping centres management, Trust, Retailers, Tenants
Paper type Research paper

1. Introduction
Planned shopping centres (shopping malls) are a dominant form of retailing in Australia
and New Zealand. In Australia, in 2007, sales in shopping centres accounted for 39 per cent
of all retail sales (Urbis, 2007, p. 2). The emerging literature on shopping centres addresses
many aspects such as shopping centre lifecycle (Lowry, 1997), consumer behaviour in
shopping centre choices (Dennis et al., 2005), the connection between shopping centre
dominance and promotion impacts (Parsons and Ballantine, 2004), anchor stores and
shopping centre image (Finn and Louviere, 1996), image measurement (Dennis et al., 2002)
and centre management (Howard, 1997). The reported work on shopping centre tenants International Journal of Retail &
embraces tenant views of shopping centres (Prendergast et al., 1998), the ideal tenant mix Distribution Management
Vol. 38 No. 8, 2010
(Bruwer, 1997), lease agreements (Addae-Dapaah and Yeo, 1999) and configuration issues pp. 597-612
such as food court impacts on other tenants (Sirpal and Peng, 1995). Despite the q Emerald Group Publishing Limited
0959-0552
significance of the planned shopping centre sector, surprisingly little research about DOI 10.1108/09590551011057426
IJRDM relationships between shopping centre management (the property manager or shopping
38,8 centre manager) and retail tenants is available.
Practitioner publications tend to focus on promotions and marketing principles
(Zivanovic, 2006), or fundamentals with passing comments on tenant-landlord
relationships (Neo and Wing, 2005), or on observations from shopping centre
consulting projects (Underhill, 2004). Industry publications tend to adopt either the
598 retailer or developer/centre manager perspective. For example, Ryan (2008) contends
that the centre manager’s role is not as a retailer but as a developer, and, therefore, to
increase asset values, and that furthermore retailers often do not understand the
complexity of managing a shopping centre. The popular press suggests a degree of
tension between centre management and their retail tenants (Chandler, 2001). Disputes
seem to flare episodically, especially when centres are refurbished, unsuitable retail
tenants removed, or when centre management increase rents “unconscionably” (Elliot,
2009). Centre managers can appear to have considerable power, which they may
potentially, or allegedly, abuse selected occasions.
Broadly, planned shopping centres play a major role in attracting consumer traffic
to retailers and in providing a physical space to conduct business. However, the
“behind the scenes” activities of shopping centre management also impact retailers and
that is the emphasis of the current paper. More specifically, the paper investigates the
determinants of trust in shopping centre managers, as perceived by retail tenants,
because trust is seen as a key element of the development of successful long-term
business relationships (Morgan and Hunt, 1994). To the extent that there is an ongoing
and continuing relationship between shopping centre owners and their tenants,
relationship development should be a key aspect affecting these types of business-to-
business (B2B) settings. Given the incidence of issues, which do arise within these
relationships, it is vital to examine the key means of maintaining good relationships
between these business partners who are in a formal relationship due to the nature of
the retail setting. Novel features of this analysis are the inclusion of both power and
empowerment as determinants of trust on the assumption that these are not equivalent
constructs in an inverse relationship. An additional novel feature is the inclusion of the
role of branding as a “trust-builder” (Brodie et al., 2002; Brodie, 2005); relatively few
studies have examined this aspect before in any context.
A major focus of the study is to contrast neighbourhood (small) and regional (large)
shopping centres. Most of the popular press commentary covers regional shopping
centres with very little reported about smaller neighbourhood centres. The size of the
shopping centre could have a major impact on how relationships are managed and how
trust is built. Identifying whether the tenant belongs to a regional shopping centre or a
neighbourhood shopping centre and comparing the level and development of trust
based on centre size is an integral feature of the research design.
The primary research question was to identify the determinants of trust. A secondary
objective was to contrast the determinants across neighbourhood and regional shopping
centres. The research question was tested using a sample of 201 Australian retail tenants
across the two size categories of shopping centres.

2. Literature review
Little research has appeared on the day-to-day organisation of the shopping centres
and the management of the relationships within it. Shopping centres have emerged out
of the 1960s as the dominant form of retailing in Australia. Currently, relatively few Building retail
new regional centres are under construction and the existing centres are continuously tenant trust
adapting to changes in the dynamic retail environment. The implication is that the way
in which centres are managed, is an increasingly important facet for the retail industry.
Much of the shopping centre literature focuses on three key topics, the impact on the
existing retail environment, the impact for the consumer and the cultural impact. Often,
when research has focused on the internal dynamics of shopping centres, the emphasis 599
is in relation to the conflicts and power imbalances that exist primarily between the
larger tenants and smaller independent tenants and the resultant impact on leases
(Gosh and McLafferty, 1991; Jones, 1991). Various authors, including Carter (1995),
Gerbich (1998) and Pashigan and Gould (1998), have explored the rent differentials
between anchor stores and other tenants within the centre. Inter-tenant tensions impact
on the overall relationship between disaffected tenants and centre managers.
The imbalance between tenants and shopping centre managers (landlords, property
managers) also arises in relation to centre promotions. Smaller retailers may perceive
that they are excluded from promotional ventures, which focus primarily on the larger
anchor stores. Conversely, the anchor stores may not consider that the smaller stores
are contributing their share to the partnership (Golisinski and West, 1995). Centre
promotions are an important part of the total marketing strategy of the shopping
centre. The promotional activities aim to generate both repeat customer visits and
product sales. Parsons (2003) found that centres are able to differentiate themselves
from other centres through the promotional strategies that they use. It is further
possible to differentiate between the various promotions to develop strategies that
increase sales, increase return visits or both. A combination of promotional activities
was the best way to generate both sales and return visits, for example having a fashion
sale-based promotion coupled with live entertainment (Parsons, 2003).
Some major barriers to these marketing activities can be coordinating the strategies
at the local level between the centre’s head office and the tenants. The way in which the
promotional costs are divided also becomes an issue. Whilst most centres have a
promotional levy, where tenants contribute to the overall centre promotional fund,
contention can still arise over how these funds are utilised and the level of cooperation
and consultation in the decision making process. Kirkup and Rafiq (1999, p. 132)
note that:
[. . .] [t]enants can also be reluctant to participate, however, due to lack of authority, lack of
experience, apathy, or a reluctance by head office to promote one centre over another. This
lack of co-operation shows that the parties do not see the shopping centre and tenants as a
“single business”, and this will not facilitate effective marketing strategies.
The implication is that the effectiveness of the relationship is at risk because of lack of
collaboration.
Howard (1997) argues that shopping centre research needs to focus on how centres
can be best managed to ensure that tenants and centre managers are working with
common goals. Prendergast et al. (1996) conducted a New Zealand study into tenant and
centre manager relations, which appears to be the only explicit study into these
relationships. They tested the tenants’ and centre manager’s perceptions of performance
on variables including creativity, flexibility, promotions, professionalism, cooperation,
friendliness, accessibility and trust. Accessibility to the centre manager by the tenants,
IJRDM was important; that is, being “hands-on” in the day-to-day management and marketing
38,8 issues helped to forge good relationships with tenants.
Fisher and Lentz (1990) argue that essentially, the partnership between the shopping
centre manager, the anchor department stores and other centre tenants, aims to provide a
profitable return to all. While all parties work towards this goal, however, the property
manager has the responsibility to enhance the business value, through the successful
600 management of the tenant mix, leases, building maintenance and operations and
promotions (Fisher and Lentz, 1990). This perspective then encourages more of a
relationship marketing approach, where centre management aims to foster customer
loyalty by responding to their needs and by providing a good tenant mix and an
organized and well-maintained centre. It also occurs through establishing better
relationships with the retail tenants, to encourage greater levels of cooperation and
mutual benefits. Naude and Buttle (2000) state that while it is easy to argue that good
relationships can be beneficial to business, it is very difficult to assess what makes a
good relationship. While a growing body of literature examines relationship quality, the
key constructs have varied between authors. Trust, satisfaction, coordination have been
consistently used in the literature, however, power and profit have largely been ignored
in empirical testing. The reason may be that up until now they have been viewed as
transactional rather than relational in nature. One notable exception is Frazier and Antia
(1995), who argue that the firm’s possession of power is distinct from the means of
applying power, including communication strategies and tactics. They indicate that,
apart from threatening communications, power can be applied through collaborative
communications, creating norms such as solidarity and flexibility.
Rokkan and Haugland (2002) argue that fundamental to a good relational exchange
is the ability of those involved to believe that the relationship has an economic
advantage, and that the parties are able to experience fairness and equity within the
relationship. Therefore, as Rokkan and Haugland (2002, p. 211) contend:
[. . .] in order to commit necessary resources and implement joint decisions, voluntary chains
need a certain level of coordination, and to limit free-riding within the chain system.
Coordination and free-riding within the chain are considered to be important factors affecting
a voluntary chain’s relationships to vendors. Second, it is important to establish a
symmetrical or balanced structure between the chain and the vendor that prevents one actor
from taking advantage of the relationship at the expense of the other.
Two models address the empirical testing of relationship quality. First, Mohr and
Spekman (1994) identify particular partnership characteristics that lead to successful
relationships. These characteristics are partnership attributes, communication
behaviour and conflict resolution techniques. They use participation to describe
cooperative behaviour within the construct of communication behaviour:
Participation refers to the extent to which partners, engage jointly in planning and goal
setting [. . .] joint planning allows mutual expectations to be established and cooperative
efforts to be specified (Mohr and Spekman, 1994, p. 138).
They argue that the ability to participate effectively in the relationship increases
satisfaction with the relationship.
Second, the Morgan and Hunt (1994) model positions trust and commitment as key
mediating variables, which lead to a quality relationship. They recognise five main
precursors to trust and commitment; relationship termination costs, relationship benefits,
shared values, communication and opportunistic behaviour. A major main outcome Building retail
of trust and commitment is the ability to cooperate. Trust must exist between tenant trust
relationship partners before cooperation is achievable. Once trust in the partnership is
established then joint activities become possible, and the outcomes that they produce
are superior to if they had acted alone (Morgan and Hunt, 1994). Morgan and Hunt
(1994) also argue that an extended relationship model should include power, which can
influence levels of trust and commitment. Their emphasis lies in the implications of 601
negative usage of power, particularly for examining dysfunctional relationships.
Davies (1996) examines power in terms of relationships between channel members
in a supply chain, where traditionally one member holds a greater degree of power than
the other does, with the resultant potential for use of that power destructively (Frazier,
1999; Hibbard et al., 2001). The display of power is exemplified by coercive tactics of
refusing to supply one member, or by one party having a high degree of confidence in
the other, to the extent that they rely on the expert decision making of the other, and
thus negate their personal input (Davies, 1996). Further, Shaw and Dawson (1996)
argue that power is usually treated simplistically in the analyses, concentrating on the
possession of power rather than on how it is used within relationships. They contend
that the changes in the way power is used can be quite revealing in helping understand
changes in broader economic and social issues (Shaw and Dawson, 1996).
Dapiran and Hogarth-Scott (2003) argue that power does not actually need to be
exercised to have an influence on the other party. The potential of perceived power can
exert influence (Dapiran and Hogarth-Scott, 2003). Therefore, in order to overcome the
measurement issue highlighted by Shaw and Dawson (1996), we conceptualise power
as the coercive use of power, which is the way in which the stronger party in the
relationship (i.e. usually the shopping centre manager) actually uses its influence over
the weaker party (i.e. the retail tenant).
Empowerment is a term related to power, but which focuses on feelings of one’s own
power, often used in the context of employees (Wilkinson, 1998). Empowerment relates
to the way in which one party feels able to direct their own actions towards a desirable
outcome. In consumer markets, having a marketing strategy that encourages
consumer empowerment, increases the potential for positive repurchasing decisions
(Wright et al., 2006). In service markets, empowerment plays a potent role, particularly
where service provider and customer have is an ongoing relationship between.
Ouschan et al. (2006) note that customer empowerment is most beneficial where
cooperation between the service provider and the customer is required.
The achievement of customer empowerment occurs in two ways; first, through the
customer being informed of the choices available and being able to participate actively in
achieving the outcomes and second, through the support provided by the service
provider. Gronroos (1987) refers to the support services that service providers can offer
to increase the consumers’ knowledge and expertise. They can relate to ongoing training,
support and encouragement to strengthen consumer skills further. In the context of the
planned shopping centre, empowerment would relate to the degree to which tenants
perceive that they have some control in their dealings with centre management, and the
extent to which they have the expectation of having their concerns heard. Further,
empowerment would encompass the degree to which centre managers provide support
and treats tenants as an important element of their relationship with tenants,
IJRDM which extends the positions taken by previous authors (Dapiran and Hogarth-Scott,
38,8 2003; Davies, 1996; Ouschan et al., 2006; Shaw and Dawson, 1996).
The relationship marketing and relationship quality literature uses responsiveness
as a key component for responding in a relational way to customer needs. Responsive
has a wide range of definitions from being prompt to customer needs, providing a
customer focus, listening to customers and keeping customers informed (Chaston, 2000;
602 Lee et al., 2000; Olorunniwo et al., 2006). Thus, responsiveness is related to, though more
encompassing than simple communication, but relies upon communication as part of
the response mechanism.
While the three key models of Morgan and Hunt (1994), Mohr and Spekman (1994)
and Gronroos (1982), do not specifically refer to responsiveness, elements are addressed.
For example, Gronroos (1982) refers to functional quality in the service encounter in
terms of how the services are provided. Communicating is just one step. Being available
for meaningful communication to take place, responding to the issues raised and
following through with any commitments made, are as essential as the communication
itself. In the shopping centre setting, responsiveness reflects the way the centre
manager responds to issues, provides information, consults and seeks feedback on
issues and the timeliness and relevancy of the information provided. A large component
of responsiveness is the way, in which both parties are able to communicate their needs.
Responsiveness also relates to the way in which centre managers actively promote the
relationship with the tenants. Responsiveness considers whether centre management
encourages positive suggestions from tenants, nurtures and develops the relationships
and provides ongoing assistance to tenants (Baker, 2002; Howard, 1997).
The services marketing literature identifies that flexibility has a strong influence on
customer satisfaction (Homburg et al., 2002; Ivens, 2004). By being flexible, service
providers are able to demonstrate a customer focus and a willingness to respond
according to their needs. Prendergast et al. (1996) identify flexibility as a crucial
attribute that managers should display to promote good relationships with tenants.
Flexibility relates to how well one party responds to the needs of the other party and
requires willingness for adjustment (Ivens, 2004). By having a flexible approach, the
long-term interests of relationship partners are considered in view of current
short-term issues. For flexibility to occur, the centre manager should have a hands-on
understanding of the retail business and the relationship. In the shopping centre
setting, flexibility is an attribute that can be applied to the relationship, the marketing
strategies and the tenant mix.
Perceptions of brand play an important role in the development of trust in business
to consumer relationships (Delgado-Ballester et al., 2003); arguably, they can also be
expected to influence the degree of trust within the shopping centre management-
tenant relationship. The literature refers not just to the role of branding as a means of
differentiation but also to the important role of establishing business and/or corporate
reputation (Brodie et al., 2002; Gronroos, 1982; Hutton, 1997). The literature also
suggests that brand may play a significant role in the development of trust in B2B
relationships (Roberts and Merrilees, 2007). In the shopping centre situation, brand
relates to the overall quality and image of the centre from the consumer (tenant)
perspective. The particular importance is in how tenants identify the special or unique
characteristics of the centre brand itself and the strength with which they then feel the
brand performs.
3. Theoretical framework Building retail
The theoretical framework for this study suggests then, that trust is a function of key tenant trust
variables:
T ¼ f ðP; E; R; F; BÞ

where T denotes retailers’ perception of their trust towards centre management,

P represents centre management power, E represents retail tenant empowerment, R is 603
responsiveness of centre management, F is flexibility of centre management and B is
the perception of tenants towards the centre brand. All signs are expected to be
positive except for power, which is likely to have a negative coefficient, indicating that
a greater level of power lowers trust.
The first four determinants derive from the traditional trust literature, as reviewed.
However, the inclusion of brand as a “relationship builder” is a little used notion,
only partly developed in the broader marketing literature (Brodie et al., 2002; Brodie,
2005).
Additional models have been added to explain antecedents and consequences of
trust. The consequences of trust are examined in a model of intention to renew lease,
where lease renewal is explained in terms of two possible variables – trust and
shopping centre brand. Also investigated was a model of brand attitudes, where
retailer perceptions of the shopping centre brand are explained in terms of service
quality and empowerment. Empowerment is explained in terms of responsiveness,
power and flexibility, with an expected negative sign on the power coefficient.

4. Methodology
4.1 Research design
A mixed methods approach has been used for the research, in order to fully explore the
tenant-centre manager relationship and ensure that the most important factors were
identified and appropriately conceptualised for data collection. For the qualitative
component, a series of semi-structured interviews were conducted to identify the major
issues in the relationship between tenants and centre managers. A questionnaire was
then constructed and pre-tested on the interview subjects. We used a sample of
Australian shopping centres as the research setting.

4.2 Data collection

A stratified random collection approach was used to collect the data. In the first wave,
centres were purposefully chosen, with the cooperation and assistance of one shopping
centre group, which own shopping centres Australia-wide. The parent company
provided access to both tenants and shopping centre managers in their centres. Data
were collected using the self-administered questionnaire, which were distributed by the
regional head office. The tenants and centre managers received their copy of the
questionnaire with their monthly newsletter. The second wave of centres involved
random selection of shopping centres, ranging from neighbourhood centres to regional
centres. For these centres, the questionnaires were mailed directly to the tenants and
centre managers. The total sample size was 201 tenants. The response rate for the
tenants was 20 per cent. The tenant sample comprised approximately equal numbers
from the regional centres (with 50 or more tenants) and the neighbourhood shopping
centres (with 30 or less tenants).
IJRDM 4.3 Measures
38,8 Each of the constructs of trust, power, empowerment, responsiveness, flexibility and
brand perception were measured using multiple-item measures. Trust was measured
using items drawn from Morgan and Hunt (1994), Mohr and Spekman (1994) and
Ruppel and Harrington (2000). Power was represented by previous measures used by
Shaw and Dawson (1996) and Dapiran and Hogarth-Scott (2003). Empowerment utilised
604 items previously used by Shaw and Dawson (1996) and Dapiran and Hogarth-Scott
(2003). Responsiveness items were drawn from previous scales developed by Gronroos
(1982), Mohr and Spekman (1994) and Morgan and Hunt (1994). The flexibility items
were drawn from Prendergast et al. (1996) and brand perception was measured using
items drawn from the Dennis et al. (2002) scale, which included brand perceptions.

5. Results
Exploratory factor analysis was utilised to determine distinctiveness of individual
scales as well as dimensionality of each measure. Bartlett’s test of sphericity was used to
test for the overall significance of the correlation matrix and a Kaiser-Meyer-Olkin
(“KMO”) level of 0.6 was used to determine sampling adequacy (Tabachnick and Fidell,
2001). Correlation matrices were also utilised to determine the inter-correlations and
relatedness of items used to measure each construct of interest. When all eight
constructs were factor analysed the KMO level is 0.901 and the Bartlett’s test significant.
Composites for each construct measure were then created using summated scales.
All summated scales tested were reliable, with Cronbach a’s greater than 0.70.
Similarly, all scales had an average variance extracted (AVE) greater than 0.50,
indicating construct validity. Specifically:
.
power: a ¼ 0.80, AVE ¼ 0.63 (four items);
.
service quality: a ¼ 0.84, AVE ¼ 0.60 (five items);
.
empowerment: a ¼ 0.78, AVE ¼ 0.60 (four items);
.
brand perception: a ¼ 0.93, AVE ¼ 0.74 (six items);
. flexibility: a ¼ 0.87. AVE ¼ 0.80 (three items);
.
responsiveness: a ¼ 0.86, AVE ¼ 0.64 (five items);
.
lease renewal: a ¼ 0.92, AVE ¼ 0.82 (four items); and
.
trust: a ¼ 0.91, AVE ¼ 0.75 (five items).

The constructs all exhibited discriminant validity, demonstrated by Table I, using the
test that the square root of the AVE must exceed the absolute value of the correlation
coefficient between any pair of constructs. As can be seen, all constructs discriminant
to each other. Additionally, exploratory factor analysis indicated that each pair of
factors loaded on to separate constructs.
Normal distribution for each of the variables of interest was then assessed through
examination in the first instance of the normal distribution as well as examination of
the skewness and kurtosis for each variable, finding no significant skewness or
kurtosis for any of the variables.
Multiple regression is used for four sets of models (Tables II, III, IV and V). In all
cases, there was a reasonably high degree of explanatory power. Across all of the
regressions there was no evidence of multicollinearity, with variance inflation factor’s
 Building retail
Construct 1 2 3 4 5 6 7 8
tenant trust
Responsiveness 0.80
Flexibility 0.61 0.92
Brand 0.43 0.32 0.86
Power 0.55 0.55 0.33 0.79
Empower 0.56 0.60 0.35 0.65 0.77 605
Trust 0.64 0.56 0.47 0.70 0.71 0.87
Renewal intention 0.39 0.25 0.48 0.38 0.29 0.41 0.90
Service quality 0.59 0.33 0.51 0.31 0.28 0.37 0.33 0.77
Table I.
Notes: The figures corresponding to square-root of AVE for each column construct is typed in italics Discriminant validity
along the diagonal; other figures are the (absolute value) correlation between two constructs matrix

Regional centres Neighbourhood

Variable Full sample (n ¼ 201) (n ¼ 99) centres (n ¼ 102)

Constant term 2.09 (3.76) * * 3.11 (3.93) * * 0.67 (0.86)

Responsiveness 0.21 (3.59) * * 0.19 (2.07) * * 0.19 (2.64) * *
Power 2 0.31 (5.36) * * 2 0.38 (4.18) * * 2 0.20 (2.66) * *
Empowerment 0.32 (5.40) * * 0.37 (4.00) * * 0.29 (3.75) * *
Centre brand 0.16 (3.44) * * 0.12 (1.50) 0.25 (4.17) * *
Flexibility 0.02 (0.33) 2 0.12 (1.31) 0.16 (2.13) * Table II.
Adjusted R 2 0.66 (77.4) * * 0.57 (26.4) * * 0.74 (58.8) * * Multiple regression
explaining retail tenant
Notes: Significant at levels *0.05, * *0.01; standardised beta coefficients (absolute t and F values in perception of trust of
brackets) centre management

Full sample Regional centres Neighbourhood

Variable (n ¼ 201) (n ¼ 99) centres (n ¼ 102)

Constant term 1.27 (3.47) * * 1.33 (2.38) * 1.10 (2.24) *

Empowerment 0.22 (3.53) * * 0.26 (2.96) * * 0.22 (2.54) *
Service quality 0.45 (7.29) * * 0.43 (4.93) * * 0.47 (5.38) * * Table III.
Adjusted R 2 0.30 (43.5) * * 0.28 (20.4) * * 0.33 (25.8) * * Multiple regression
explaining retail tenant
Notes: Significant at levels *0.05, * *0.01; standardised beta coefficients (absolute t and F values in perception of centre
brackets) brand

ranging from 1.2 to 2.3, all appropriately less than the critical benchmark of 10 (Fox,
1997).
A standard multiple regression was then performed to examine the effect of the five
determinants on trust, with the results shown in Table II. The aggregated model
explains 66 per cent of the variance in retail tenant trust perceptions, slightly greater
for the neighbourhood shopping centres.
We focus on comparing the two types of shopping centres. For regional shopping
centres, both empowerment and (inversely) power are similarly strong determinants
IJRDM of trust. In neighbourhood shopping centres, the same two variables are also important,
38,8 though empowerment assumes a somewhat greater role, as evidenced by the standardised
beta coefficient (0.29 versus 20.20). Flexibility has an influence on trust only in the
neighbourhood shopping centres. Branding is also important for neighbourhood shopping
centres, but not much for regional centres. Responsiveness has a similar beta coefficient
across both types of centre, though it is relatively more important in regional centres.
606 Table III reports on multiple regressions attempting to explain tenant attitudes to the
shopping centre brand. The models explain about 30 per cent of the variance in tenants’
perceptions of the centre brand. For both types of centre, the quality of services
(cleanliness, ambience and marketing) provided by the centre to tenants is the dominant
explanation of perceptions of the centre brand. Higher levels of service quality
enhance the perception of the shopping centre brand. Empowerment of tenants plays a
secondary role.
Table IV examines the consequences of trust in terms of explaining the likelihood of
the retail tenant renewing their lease in the shopping centre. The extent of the
dependent variable being explained is least for this model, though the F-ratio is
significant at the 1 per cent level. Clearly, a number of omitted variables play a large
role in the decision of retailers to renew a shopping centre lease.
For neighbourhood shopping centres, the two explanatory variables, trust and brand,
play about an equal role as measured by the beta coefficients. However, for regional
shopping centres renewal of lease is more determined by brand rather than trust,
although trust still plays an important role and is significant at the 1.2 per cent level.
Finally, in terms of modelling, we report (Table V) the results explaining
empowerment. A high level of variance explained is achieved. The results are extremely

Full sample Regional centres Neighbourhood

Variable (n ¼ 201) (n ¼ 99) centres (n ¼ 102)

Constant term 2.35 (6.61) * * 2.54 (5.03) * * 2.25 (4.42) * *

Trust 0.24 (3.51) * * 0.24 (2.57) * 0.27 (2.53) *
Table IV. Centre brand 0.37 (5.40) * * 0.39 (4.20) * * 0.31 (2.84) * *
Multiple regression Adjusted R 2 0.27 (38.1) * * 0.26 (18.6) * * 0.26 (18.5) * *
explaining retail tenant
intention to renew centre Notes: Significant at levels *0.05, * *0.01 level; standardised beta coefficients (absolute t and F values
lease in brackets)

Regional centres Neighbourhood

Variable Full sample (n ¼ 201) (n ¼ 99) centres (n ¼ 102)

Constant term 3.86 (8.19) * * 3.90 (5.49) * * 3.86 (6.02) * *

Responsiveness 0.17 (2.57) * 0.15 (1.58) 0.17 (1.88)
Flexibility 0.27 (4.71) * * 0.27 (2.71) * * 0.29 (3.13) * *
Power 2 0.41 (6.52) * * 2 0.39 (4.21) * 2 0.42 (4.88) * *
Table V. Adjusted R 2 0.51 (71.4) * * 0.44 (26.9) * * 0.55 (42.9) * *
Multiple regression
explaining retail tenant Notes: Significant at levels *0.05, * *0.01; standardised beta coefficients (absolute t and F values in
empowerment brackets)
similar for both types of centre. Power in an inverse way is the dominant determinant of Building retail
empowerment, with a coefficient in each of about 2 0.40. In other words, a 1.0 unit tenant trust
increase in power decreases empowerment by 0.40. Next in influence and also significant
at the 1 per cent level is flexibility. Greater levels of flexibility increase the perception
of empowerment. The third influence and of marginal importance at best, is
responsiveness.
607
6. Discussion
The results focus on how retail tenants perceive the trust relationship between centre
managers and themselves. The trust relationship is an important barometer of the
extent of harmony or conflict and tension in the system. If trust is low then it adds a
layer of difficulty to retailers in conducting their business. Lower levels of trust
suggest discontent, which could become a distraction from the retailers’ abilities to sell.
From the point of view of the centre manager, there are also benefits in trust. Apart
from greater harmony as an end itself, there are performance consequences of higher
levels of trust, namely a higher rate of lease renewal by retail tenants.
The study provides insight into how centre managers can build trust with their
retail tenants. Empowerment (a sense of relevance to decision making) was identified
as the most critical determinant of trust across both regional and neighbourhood
shopping centres. A perception of restraint in power was also very important, especially
in regional shopping centres. Expressed differently, retail tenants heavily weight the
abuse of power by shopping centre managers when forming their perceptions of trust.
Tenants in regional centres also place considerable weight on centre management
responsiveness (including accessibility and problem solving). In contrast, tenants in
neighbourhood centres place more weight on management flexibility and the centre
brand when forming their trust perceptions.
Understanding why these different patterns of trust building emerge is not easy to
explain. The very high importance of power and empowerment in regional shopping
centres may reflect that centre managers employ a more hierarchical approach. This
would also explain the concern about responsiveness. In contrast, flexibility may be the
norm in the smaller size neighbourhood centres. Flexibility may play a greater role in
neighbourhood centre trust building because it is more realistic for centre managers to
be flexible in terms of adjusting services to the requests of one tenant. If one tenant out
of say ten has a need for a change in service then this is more realistic than if the tenant
is one out of a hundred tenants (as in some larger centres). Tenants in neighbourhood
centres may expect greater customisation or adaptation to the situation. A greater
relative weighting for empowerment is consistent with this more “participatory”
approach to centre co-management.
The brand may seem at odds as a trust determinant in neighbourhood centres, but it
may be that the tenants in such centres expect and depend on the centre management
to deliver on customer patron traffic (the competency part of trust). It may reflect the
way that the shopping centre brand is internally marketed among the retail tenants.
Perhaps, in a neighbourhood centre, the brand is presented in a more co-operative way,
holistically fusing the interests of the centre managers and the retail tenants.
A novel contribution of the study that affects the broader trust literature is the
inclusion of power and empowerment as two separate influences on trust. Both factors
make important contributions to explaining trust. Consistent with recent studies,
IJRDM we focus on the expression of power rather than the possession of power. However,
38,8 empowerment is simple not the opposite of power. Rather they are two distinct
constructs, also evident from our discriminant analysis. Also, as discussed, a one unit
increase in power does not lead to a one unit decrease in empowerment; the actual
coefficient is 2 0.40, again demonstrating that the two constructs are not simple
opposites.
608 The consequences of trust are clear in terms of the increased probability of lease
renewal by retail tenants. For both regional and neighbourhood centres, trust positively
and significantly increases the likelihood of lease renewal. A slight difference in
intention behaviour occurs across the two types of centre. For regional centres, trust
plays an important role, but the dominant influence is a strong brand; that is, the
marketing power of the centre brand to generate consumer traffic. Economics prevails
over well-being. In contrast, for neighbourhood centres, trust and brand are equally
influential. Perhaps, there is no-where to hide in a small, neighbourhood centre if trust
collapses with a particular retail tenant; exit is more likely for a given level of distrust.
The paper provides some insight about how retail tenants form favourable
perceptions about the centre brand. All of the results suggest that the level of service
quality provided by centre management is the most powerful way of enhancing brand
attitudes. Shopping centres wishing to increase the level of favourable perception need
to improve the level of service quality, including cleanliness, ambiance and promotions
and other marketing. The shopping centre brand has both external and internal roots.
If centre managers can improve consumer traffic through better promotions or special
events then that will help. Equally, improved management activities around the centre
can also improve how well the brand is perceived. In a similar way, greater
empowerment can also help to improve brand attitudes, as held by the retail tenants. In
this sense, empowerment can be thought of as a type of internal branding, involving
the tenant as a B2B customer in the co-determination of decisions and thus the brand.
Further insight into centre management comes from the models of retail tenant
empowerment. The very high and significant constant term in the relevant regressions
indicate that there are specific behaviour and activities that the centre management can
do to portray their encouragement of empowerment by retailers. Restraining power
and greater flexibility can be used to assist empowerment. Reducing power is not
sufficient to get empowerment. Empowerment also requires flexibility and other more
explicit measures, such as responsiveness.

7. Managerial implications
The results and discussion provides considerable practical ideas and frameworks for
centre managers to improve the quality of their management and relationships with
retail tenants. All five determinants of trust represent possible mechanisms for
improving trust, although empowerment was seen as the most important. It is also
suggested that regional centres could learn from neighbourhood centres, particularly
in understanding how the latter use flexibility and branding to enhance trust. The
discussion indicates that neighbourhood centres may use more effective internal
branding and marketing tools to leverage the benefits of the centre brand in facilitating
trust. Benchmarking with neighbourhood centres and introducing an internal
branding strategy is a major opportunity for regional shopping centres. Such a
strategy could also benefit by the results on brand attitude formation, which emphasise
service quality. Evaluating and revamping the mix of service quality provided by Building retail
centre management is a related opportunity. tenant trust
There are numerous other practical suggestions covered in the discussion section.
One issue that spans a number of the models is the perception of power. As noted, the
emphasis in the current paper is not the possession of power, but how it is expressed.
Centre management have an opportunity to re-assess how they express power, either
advertently or inadvertently. Softening the expression of power would have benefits 609
for both tenants and centre management (in terms of greater trust and lease renewals).

8. Conclusions
This research aimed to provide a contribution to the development of relationship
marketing in the shopping centre literature. It does this by exploring the antecedents
to, and consequences of, trust. A strong model of trust is developed, with five key
determinants led by empowerment (the other four determinants are inverse power,
responsiveness, the centre brand and flexibility). However, differences apply to
neighbourhood and regional shopping centres, with aspects like power and
empowerment more important for the regional centres. Perhaps, surprisingly, it is
argued that regional centres could learn from neighbourhood centres in terms of how to
use flexibility and branding to enhance trust between centre management and retail
tenants. In particular, regional shopping centres could learn how to apply internal
branding techniques to get greater retailer tenant buy-in to the centre brand.
The research findings inform Australian shopping centre managers as to how to
improve the relationships, which they have with their retail tenants. Improved
relationships will contribute not only to individual shopping centre brands but also to
developing a stronger retail sector overall.

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Corresponding author
Bill Merrilees can be contacted at: bill.merrilees@griffith.edu.au

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