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16
dTZ | In Situ
For a large number of retailers (such as JJB, Birthdays and
comet) the final curtain came down in 2012. hmV, republic,
Blockbuster and Jessops can be added to this list and,
more often than not, these failures have been down to poor
management decisions brought about by the need to increase
turnover to meet investor expectation. In other instances it has
simply been poor retailing and the inability to meet changing
consumer trends as quickly as others. The very challenging
environment since 2007 has taken its toll. Whatever the
reasoning, the balance of power has shifted when the uK is
looked at as a whole, and supply has now outstripped demand
and it is this which casts an element of doubt and uncertainty
over the real state of the high street. The facts speak for
themselves – recent research suggests that approximately 11% of
the uK’s retail stock is now vacant, in excess of 25 million square
feet of space.
The media in particular has been quick to highlight the fate of
the high street, regularly reporting on declining sales, increasing
administrations, the growth of online sales, and the resulting
spike in empty shops across Britain. The media is unlikely to
relent in the short term and the debate will no doubt continue
to grow with the airing of the mary Portas report, which aims to
provide a solution to the problem. In reality the situation is too
complex to ever be properly resolved. The planners are unwilling
to set costly precedents by loosening restrictions and the
government is financially unable (and unwilling) to modernise the
archaic business rates system. one aspect however remains the
same - retailers with the right product in the right location will
make money at the right rent. This is key. Void units are coming
back to market in good areas and the process of rental re-basing
has commenced. As such, quality high streets will be revitalised
and void rates will invariably decline as retailers feel they can
generate sufficient turnover from individual locations – but
crucially only where the ‘pitch’ is deemed strong enough, and the
deal is financially viable.
The uk high street
A tenant’s perspective
‘Location location location’ is perhaps one of the most overused phrases in the context of retail property,
yet is one that has never been more relevant than in today’s market. Like many other industries, the
retail market has had a torrid time over the last four or five years, following a prolonged period of growth
between 1997 and 2007. The global economy has weakened as has the uK economy, and consumer
demand and spend has waned, having a direct and all too obvious impact on retail sales.
A review of 2012 and thoughts for 2013
