Cambridge and Guildford top the list of the UK’s most resilient retail locations, according to new Cushman & Wakefield research that ranks the viability and performance of 250 high streets outside central London.
Online sales coupled with rising business rates have made survival on the high street challenging for retailers in the UK over the past decade. The Cushman & Wakefield research report UK High Streets: Dead or Alive? reveals the top-performing locations as well as the bottom-performing ones.
The report’s main measure is the retail resilience index, a ranking of 250 towns based on 22 economic, demographic and retail property metrics, most of which have been tracked over a 10-year period.
These metrics include retailer demand, leisure spend, floor space density, rental change as well as broader economic indicators such as house prices, catchment demographics, business survival rates and tourism spend.
Ranked according to metrics
Towns have been ranked according to each metric, with the final placing calculated from the sum of the individual rankings. Locations have then been assigned a town tier (1 to 5, of which 1 is the highest) based on their overall ranking, to enable a comparison with similar locations.
On an individual town basis, Cambridge, Guildford, Bath, Chichester and Oxford were the high streets that showed the greatest resilience over the past decade. Conversely, Hamilton, Llandudno, Newport, Greenock, Ramsgate and Kilmarnock were at the bottom of the list of 250 sites.
The report highlights a number of towns as having performed better than expected. Cirencester in Gloucestershire, for example, ranks higher than locations of equal size owing to its robust performance on variables relating to the business environment as well as the quality of life index.
Elsewhere, despite being 71st on the list, the small town of Marlow in Buckinghamshire ranks in first place for both rental growth and retailer demand, as a result of its small but wealthy catchment. Further down the ranking, a lack of investment and pressure from competing centres has hindered Gloucester’s performance over the past decade.
Other key findings:
■ Half of destinations in the top two tiers were in the South East and Greater London.
■ Only 19 of the 250 high street locations in the analysis recorded rental uplift over the 10-year period. In the worst-performing towns, rents have rebased by as much as 45%.
■ Commercial property investment volumes in tier-one towns were 367% higher than tier-five between 2007 and 2017, compared with 109% between 1999 and 2006.
■ Comparison tourist spend in tier-one towns is 694% higher than for towns in tier five.
■ House prices in the Home Counties, which account for almost 40% of all locations in tiers one and two, rose by 44% over the 10-year period to the end of 2017, compared with a national average rise of 24%.
■ Residents in tier-one towns are most likely to make a purchase online.
■ Leisure spend densities (£ per sq ft) are the highest in tier two locations.
■ The number of passengers travelling through railway stations in tier-one towns increased by 60% over the 10-year period compared with 46% for towns in tiers four and five.
Report author Amy Gibson, Cushman & Wakefield’s senior research analyst, said: “Consumer tastes and needs have evolved over time and it is clear from our analysis that some locations have adapted more effectively than others to the ongoing structural change in the sector.
“Consumers are willing to travel further to seek out new and exciting retail experiences, while simultaneously demanding greater convenience nearer to home.
“This creates opportunities on some of the country’s most challenged high streets to diversify beyond the traditional retail offer and explore alternative uses that are relevant to the needs of the catchment population. Essentially, it is about re-purposing the high street.”
A picture of the UK’s high streets
Darren Yates, Cushman & Wakefield’s head of EMEA retail research & insight, said: “This study reveals where in the UK the high street is doing very well and there are a number of places which are thriving.
“However, profitability in the online era has been a major challenge for retailers, with a number consolidating store estates to reduce costs. The selective nature of demand has created a polarised retail environment, with many operators focusing on key, high-footfall locations.
“For investors, this structural change has made it harder to pick ‘winning’ assets, while the blurring of online and offline has made it increasingly difficult to quantify the value of the store.”
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