A new report published by the Local Data Company, which describes how the number of empty shops on the UK’s high streets rose to an all time high in 2010, paints a gloomy picture for the year ahead. Town centre vacancy rates increased from 12% at the end of 2009 to 14.5% at the end of 2010, according to the report, which also reveals an increasing North-South divide. Northern and Midland regions perform badly against the national average with vacancy rates of 16.5%, while vacancies in Southern regions are lower at 12.3%. The report also illustrates a size divide, with larger town and city centres suffering a significantly higher vacancy rate than smaller centres.
The report predicts that together, the VAT increase, public sector spending cuts and the proposed abolition of Empty Rate Relief on all properties except those with a rateable value of less than £2,600 are likely to adversely affect the retail sector in 2011. The report says
“fundamental structural changes are taking place in UK retail, be it at the retail or consumer levels. The very fact than ten years ago the majority of a multiple retailers stores were on a high street, but now we are seeing a migration from the high street into shopping centres and out of town shopping parks, begs the question of what will fill the high street of 2020 and beyond?”
The report provides an interesting background to considering the rise in popularity of the pop up shop and the trend towards shorter and more flexible leases. Liz Pearce, Chief Executive of the British Property Federation, says of the changing face of our high streets:
“The challenge for local authorities is to work with businesses, including retailers and landlords, to sensibly manage this transition and to be creative in looking for new roles and uses for empty shops.”