BCSC 2013: Retail letting deals have risen by 20% since the start of recession as churn in the market increases, according to the latest figures from EG Retail Research.
The number of deals done in the twelve months to the end of June 2013 rose by a fifth to more than 7,000 compared with the same period in 2008. The amount of space transacted has remained virtually unchanged, however, down by 2% on 2008.
Graham Shone, EG’s head of retail research, said the churn of units, rather than renewed health in the retail market was behind the increase.
“It’s like whack-a-mole, you lease one unit and two more vacant ones pop up,” he said. “The reality is landlords are looking for the type of tenants they might not have considered 5 years ago.”
Mat Oakley, head of research at Savills, warned that deals were failing to lead to a net absorption of space with rationalisation and retailer caution continuing to put a brake on the market.
“Many retailers are still looking to exit from poor performing locations, but the pick up in consumer confidence is also stimulating a rise in acquisitions,” he said.
Oakley predicts some Grade B locations will need a fall of 15-20% in rents to become viable again.
High street deals gained on shopping centres with space outside centres accounting for three-quarters of all deals, up by nearly 3% on 2008.
For a full breakdown of the numbers click here
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