Representatives from the property, retail and banking sectors have joined forces to tackle the problem of the UK’s failing high streets. The industry-wide group met for the first time last week and has subsequently announced which organizations have signed up to the new body.
The Distressed Retail Property Taskforce includes senior figures from the British Property Federation, the British Council of Shopping Centres and the Local Government Association. Other members include representatives from Lloyds Bank, the Royal Bank of Scotland and the Booksellers Association.
The group’s first task will be to measure the full scale of the problems facing landlords and their bankers as the number of unoccupied retail properties reaches record levels in many areas. They will spend six months gathering evidence and identifying the worst affected towns before embarking on the difficult task of proposing solutions.
The chairman of the group, Mark Williams, recognizes the challenges that lie ahead. He said; “We have too many shops, the wrong size and under-invested.
“So the change in town centres that is required is significant and will require public and private sectors coming together to find ways of financing these changes.”
The problem lies in the fact that many empty retail properties are worth less than they used to be, leaving landlords unwilling or unable to invest. In turn, the banks that lent the money in the first place find themselves facing big losses.
This is a stalemate that has attracted the attention of Bank of England governor Sir Mervyn King.
Last week he said; “I am not sure that advanced economies in general will find it easy to get out of their current predicament without creditors acknowledging further likely losses, a significant writing down of asset values and recapitalisation of their financial systems.”
Given this situation it’s clear the Distressed Retail Property Taskforce faces difficult choices if they are to come up with proposals for a long term solution.
