// Rising demand for retail property has given “renewed optimism” to UK high streets
// Many landlords have become more flexible in order to attract new brands
A rising demand for retail property to be used for leisure and hospitality businesses has given “renewed optimism” for some UK high streets and shopping districts, according to industry experts.
The pressure from lockdown measures saw vacancy rates across shopping destinations hit record highs in the second quarter of 2021, with just over 14% of high street store locations remaining empty during the quarter.
Shopping centres fared even worse, with vacancy levels sitting just under 20%.
Vacancy rates began to level out in the third quarter however, following a surge in interest from firms outside of traditional retail.
The collapse of major brands such as Debenhams and Topshop owner Arcadia at the end of 2020 saw the number of empty sites soar, placing increasing pressure on landlords.
As a result, many property owners have become more flexible and are offering stronger rates in order to attract new brands and businesses.
Chief executive of Retail Economics, Richard Lim, told PA news that potential tenants are “getting the best terms they will have seen for many years”.
“You can’t help but see renewed optimism when strong retailers are getting plenty of opportunities and landlords are working really hard to ensure their proposition is really relevant,” he said.
“There has been a shift in power away from landlords somewhat back towards the retailers and hospitality.”
Hugh Knowles, managing director of indoor mini-golf operator Puttshack UK, said the “increased availability” of larger units in attractive locations has also helped the growth of the leisure sector.
“Finding ‘large box’ space traditionally hasn’t been easy in prior years,” he said. “But the increased availability more recently has amplified innovation and as a result we’ve seen an increase in social entertainment business.
“Customers’ expectations will naturally rise, so it’s great that retail and leisure can share spaces in well thought out, designed schemes.”