There is more discouraging news for the UK high street this week, with evidence suggesting that more retailers are departing for out of town commercial property developments. This comes despite the government accepting the majority of the recommendations contained in the Portas Review last month.
The report, by Trevor Wood Associates, shows the flight from the high street is gathering pace, with top retailers including Marks and Spencer and Next among those choosing to shift their operations to out-of-town retail parks. Worryingly, the report points to a number of discount chains following suit, leaving more vacant high street commercial properties in their wake.
When accepting the proposals of the Portas Review, the government pledged £10 million to help reverse the decline of UK high streets and make them the heart of their communities once again. However, Portas’s call for curbs on future out-of-town developments was rejected; much to the disappointment of bodies representing independent retailers.
This week’s news is sure to lead to calls for further action to help struggling high streets where commercial property vacancy rates are at an all time high. These figures have been increased in recent months by the difficulties faced by retailers like TJ Hughes, and they are poised to increase further following the announcement that Mothercare is to close a large number of outlets.
In contrast, commercial properties on out-of-town retail parks are in high demand, with retailers like B&Q, The Range, and even Poundworld and Home Bargains, all taking up significant amounts of floor space over the past year. Indeed, Poundworld has been the biggest taker of out-of-town commercial property, in relative terms, opening 36 new stores last year.
Others following suit include Pets at Home, Toys R Us and high street favourite New Look. This has seen a fall in out-of-town commercial property vacancy rates to 9.2%, compared to a national average of 14.6% on the high street. These figures drop to just 6.8% for vacant stores with A1 planning permission
Due to the recession, there have naturally been fewer developments recently. Currently there are less than 100 new schemes in the pipeline or awaiting planning permission, but as increasing numbers of traditional high street retailers join the race for out of town space, this can only fuel demand and add further to the town centre decline.
If this trend continues, it will become increasingly difficult to reverse the damage to UK high streets and commercial property vacancy rates will continue to rise. If the government is serious about addressing the problem then it should be doing all it can to ensure the Portas recommendations are implemented quickly and that the Town Centre Teams charged with overseeing them are given the powers to do so effectively.
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