Crisis Driven Vacancies Continue to Climb
Helen Dickinson OBE, Chief Executive, British Retail Consortium:
“With the country in and out of lockdown, the forced closures of thousands of shops, and consumers reluctant to visit town and city centres, it is unsurprising that the number of shuttered stores continues to rise. Over the past two years, one in every 50 outlets has permanently closed, and this number will only go up. The big increase in vacancy rates during the crucial golden retail quarter, when demand is usually high, serves as a stark reminder of the pandemic’s impact. Social restrictions and their knock on effect on consumer appetite for fashion, has meant that shopping centres are still faring the worst due to their high proportion of clothing outlets. What’s more, due to economic uncertainty, many retailers have paused their plans for future investment in new stores.
“If Government wants to avoid unnecessary shop closures and the loss of tens of thousands of jobs, it must urgently extend the business rates relief beyond April, providing additional targeted financial support to the hardest hit retailers, and extend the moratorium of aggressive debt enforcement. Without these interventions, not only will retail firms go under, but the vibrancy of our town centres and local communities across the country will be lost.”
Lucy Stainton, Head of Retail and Strategic Partnerships, Local Data Company:
“The latest LDC vacancy figures clearly show the predicted acceleration in units closing, the catalyst of which being the COVID-19 pandemic. However, this number only reflects the very immediate impact of the pandemic on the retail market. Hundreds of thousands of stores have been struck by changing restrictions and many of these remained temporarily closed in the intervening periods between lockdowns. Therefore these businesses are not reflected in the permanent vacancy figures. With each round of restrictions, these ‘frozen’ units are less likely to reopen and so we’re predicting the compound effect of each lockdown being visible in later figures.
Added to this, with recent announcements from the likes of Debenhams and Arcadia, the size of the stores coming onto the market will present a real challenge given the likely lack of demand for larger high street units. With a limited number of new store openings, structural solutions will need to be found to prevent these vacant units lying empty for 2,3,4 years or more. Looking further out, the increase in availability of space will provide opportunities for new businesses, however we must prepare ourselves for the picture to get worse before it gets better.”