What's in store for Retail?
Executive Summary
The worst economic recession since the 1930s has obviously taken its toll with capital values for some properties having fallen by up to half, eradicating many investors equity and making the Banks the owners of many of our shopping centre’s and high streets. The flood of retail failures prior to and shortly after Christmas 2008 has been stemmed and although few would suggest there will not be further casualties, occupier demand is surprisingly buoyant. The issue is the terms upon which retailers are prepared to let a unit.
Landlords appear to have learnt the lesson of the early 1990s, in part forced upon them by the Government’s implementation of full vacant rate payments and are now prepared to keep units occupied almost on any terms. Rent free periods and/or incentives equal to two or three years are common place with there being extreme examples of five or even six years rent free being accepted. Short-term leases on a turnover basis are often being entered into but at least the occupancy of a unit helps maintain vibrancy and a feeling of wellbeing in our shopping centres and high streets.
Central London and the large dominant in and out-of-town regional centres, together with the much smaller market towns are fairing the best as they did so in the 1990s. Discount retailers and those with very strong brands are also trading much better than those in the middle ground who cannot appeal on price and/or quality in an evermore discerning market. Those retailers with an effective website also continue to prosper, although happily, customer service is still favoured, resulting in John Lewis’ continued expansion.
Contact
Greg Styles Head of Retail Development +44 113 200 1818
See also
Market reports
- UK Shopping Centre Investment Market Review, February 2010 (PDF 222KB)
- Property Snapshot, February 2010 (PDF 222KB)
- National Retail Barometer, Winter 2010, (PDF 1.4MB)
- Real Estate Investment Forecast, Q4 2009 (PDF 387KB)
- Property Pricing Survey, November 2009 (PDF 456KB)
- Central London Retail Health Check, Autumn 2009 (PDF 771KB)
- Shop Vacancies: Filling the Void! Autumn 09 (PDF 328KB)
- Great Britain Retail, Autumn 2009 (PDF 344KB)
- National Retail Barometer, Summer 2009 (PDF 1.3MB)
- Central London Retail Healthcheck, Spring 2009 (PDF 1.5MB)
- National Retail Barometer, Winter 2009 (PDF 770KB)
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URL for File: /documents/Research-MarketOverview/rese_propertySnapshot_0210.pdf
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URL for File: /documents/Research_retail/rese_NationalRetailBarometer_q309.pdf
URL for File: /documents/Research_retail/rese_londonretailhealthcheck_q109.pdf
URL for File: /documents/Research_retail/rese_nationalretailbarometer_q109.pdf