London’s West End, known as one of Europe’s premier shopping districts, is expected to fully recover within the next two years, according to a report commissioned by the New West End Company (NWEC) and conducted by Colliers. Despite the challenges posed by the decline of small shopping centers and the impact of the pandemic, the West End is projected to generate a turnover of £8.6 billion ($11.9 billion) this year. By 2024, it is anticipated that the district will return to pre-pandemic levels of £10 billion ($13.8 billion), with a potential increase of 14% by 2025, equivalent to an additional £1.4 billion ($1.9 billion).
However, the post-pandemic West End will undergo some changes. Several iconic retailers, like Topshop, have disappeared from Oxford Street, making way for new players such as Ikea. Additionally, stores like John Lewis and M&S are adapting by converting some of their space into offices. The recovery is also characterized by a shift in the source of sales, with domestic shoppers now driving the turnover instead of international visitors. NWEC is urging the government to implement measures that will encourage overseas tourists to return to London’s West End and British high streets as a whole.
Although there has been a 30% increase in turnover compared to 2020, the numbers for 2021 only reached 46% of pre-pandemic levels due to significantly reduced footfall throughout the year. However, domestic-generated sales are rebounding rapidly and are expected to surpass 2019 figures within the next 12 months. The absence of high-spending international tourists remains a challenge, particularly in areas heavily reliant on tourism like Regent Street, Bond Street, and Mayfair. Sales in these areas only reached an average of 33% of 2019 levels in 2021.
Jace Tyrrell, Chief Executive of NWEC, believes that the opening of the £19 billion ($26 billion) Elizabeth Line will be a significant catalyst for the West End’s recovery. Tyrrell emphasizes the importance of attracting high-spending tourists to boost the nation’s recovery and calls for incentives to entice them back to the UK. Paddy Gamble, Co-Head of Retail Strategy at Colliers, highlights the uneven recovery across different parts of the West End, with areas heavily dependent on domestic trade bouncing back more quickly. However, areas reliant on tourists and international visitors will take longer to regain pre-pandemic levels of footfall and sales.
NWEC’s wishlist for government intervention includes simplifying the visitor visa system, which currently lags behind destinations like Paris and Milan, and reassessing the abolition of tax-free shopping. The removal of tax-free shopping privileges has given other major cities a 20% price advantage over the UK, making it less appealing to high-net-worth tourists. NWEC also advocates for extending Sunday trading hours to cater to weekend city break shoppers, estimating that this change could generate an additional £250 million ($345 million) in sales annually.
In order for London’s West End and the wider country to maintain their global competitiveness, attracting international tourists is crucial. These tourists contribute approximately £237 billion ($327 billion) to the UK economy each year and support around one in eight jobs in London. To ensure long-term success, efforts must be made to restore the West End’s status as a destination of choice for tourists from all over the world.
Useful links:
– Colliers
– New West End Company (NWEC)
