According to the British Retail Consortium (BRC) and the Local Data Company, retail vacancy rates in the UK saw a slight improvement in the last quarter of 2022, dropping to 13.8%. While this is a positive development, the rates are still higher than the levels seen before the pandemic. However, there were several factors that contributed to this improvement. One of the key factors was the return of international tourists to UK towns and cities, which boosted retail occupancy. Additionally, the increased number of people visiting offices also played a role in improving the vacancy rates.
The report highlighted that all retail locations saw improvements in their vacancy rates during the fourth quarter, marking the fifth consecutive quarter of decline. Shopping centres experienced a reduction from 18.8% in the third quarter to 18.2% in the fourth quarter. High streets also showed improvement, dropping from 13.9% to 13.8%. Meanwhile, retail parks continued to have the lowest vacancy rate at 9%, with a reduction of 0.7 percentage points from the previous quarter.
Geographically, Greater London, the South East, and the East of England had the lowest vacancy rates, ranging from 11% to 12.7%. On the other hand, the North East, Wales, and the West Midlands had the highest vacancy rates, ranging from 15.8% to 18.2%.
Lucy Stainton, the Commercial Director for the Local Data Company, emphasized the significance of vacancy rates in assessing the health of the retail and leisure landscape. She expressed positivity about the continuous decline in empty units since the peak of the pandemic, particularly noting that retail parks have outperformed other locations. This suggests that consumers are still preferring these drive-to destinations and larger format units.
However, Stainton also acknowledged that shopping centres have seen a significant decline in vacancy rates due to investors seizing opportunities to repurpose space for alternative uses and new concepts. This indicates a shift in consumer preferences and highlights the need for retailers to adapt to the changing market.
Overall, while the improvement in vacancy rates is a step in the right direction for the UK retail industry, there is still work to be done to fully recover to pre-pandemic levels. The positive factors mentioned in the report, such as the return of tourists and the shift in consumer habits, provide hope for further improvements in the future. Retailers are gaining confidence to invest in repurposing and reopening empty units, indicating a potential revival of the retail sector.
Useful links:
– BRC News Release
– Local Data Company – Revitalising British High Streets
