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Signs of life for UK’s shopping centres
7th Sep 2012
Land Securities' Trinity Leeds centre Photo credit: Land Securities
A recent report by Cushman & Wakefield suggests there’s plenty of light at the end of the tunnel for the UK’s shopping centre developments. Despite coming to a near-standstill this year, an upturn in developments planned for 2013 could pave the way for a resurgence in retail development.
With news of a double-dip recession hitting headlines in April, it’s no surprise developers chose to hold off on shopping centre expansion. According to Cushman & Wakefield, the projected total of new UK shopping centre space brought to market in 2012 totalled just 33,000 sq m, a decline of nearly 90 per cent on the 275.495 sq m added in 2011. In fact it’s the lowest annual figure recorded since the early 1960s, when the UK also experienced a number of recessions, although these were short lived and shallow by comparison.
Less than 200,000 sq m of new shopping space was added to the market in the first half of 2012. The 15,600 sq m Tesco-anchodred Swan Centre in Yardley took up the majority of the development, and was the only new shopping centre to open, with extensions accounted for the remaining new shopping centre space. The second half of 2012 doesn’t look to provide much relief either, consisting of six extensions to existing shopping centres, including the MetroCentre’s MetrOasis development.
However, just as the economy has its troughs and peaks, an upturn is now thought to be on the cards for the UK’s shopping centres. Cushman & Wakefield forecast that nearly 175,000 sq m of new retail space will be developed in 2013, with new schemes including the Trinity Leeds centre, New Square in West Bromwich and the Whiteley Shopping Centre in Fareham, as well as the Lewis’s Building in Liverpool.
“There is substantial potential in the current retail development market for savvy investors to focus on improving schemes through proactive asset management.” Toby Sykes, partner, retail services for Cushman & Wakefield said, adding:
“The lack of supply of new shopping centre space, together with strong demand from leading retailers, is a genuine opportunity for landlords. From our experience leasing Trinity Leeds and Whiteley, it is apparent that there is currently robust demand for the right development product.”
As Westfield reports "exceptional trading" for its Stratford City centre during the Olympic Games, and the market is encouraged by Land Securities' Trinity Leeds plans for the northern city centre, it seems Cushman & Wakefield are not the only ones to spot some signs of life in the UK’s shopping centre development.