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7 ANALYSIS


Discount stores drive growth out of town


Value retailers have been the biggest takers of out-of-town space over the past year according to Trevor Wood Associates


As austerity continues to guide shopper’s spending habits, budget stores are looking at out of town stores to fuel their expansion needs. According to Trevor Wood Associates’ ‘Definitive Guide to Retail & Leisure Parks 2012’; Home Bargains, B & M, The Range and Poundworld took more than 1m sq ft of out of town space between them over 2011; only DIY giant B&Q took more space than any of these budget stores.


This expansion, combined with the growth


of traditional high street traders such as Argos and Next, has led to the vacancy rate for retail parks with open A1 planning permission (that can be occupied by any type of retailers) dropping to 6.8 per cent from 2010’s 7.9 per cent.


Conversely, the vacancy rate for out of


town stores that can only be occupied by bulky goods retailers has risen to 10.8 per cent from 2010’s 10.0 per cent. The overall vacancy rate out of town has remained at 9.2 per cent, well below the peak of 11.8 per cent seen in mid-2009.


The guide, which analyses every out of


town scheme throughout the UK, found that downsizing and closure of some retailers slightly increased the amount of second-hand floor space available in mid-2011. The majority of stores with open A1 consents that were vacated by retailers entering administration, such as Focus or Land of Leather, were snapped up by the fast expanding budget stores and others such as B&Q, Hobbycraft, Pets at Home and Smyths Toys. Comparison stores increasingly dominate


the out of town market: the total retail warehouse market grew marginally to 175.8m sq ft in 2011 from 173.8m sq ft in 2010 but the proportion taken by comparison goods retailers (excluding DIY) rose to an all-time high of 52.2 per cent in 2011 compared to 48.9 per cent in 2009. Floorspace specifically on retail parks grew to 108.14m sq ft in 2011


TOP 5 GROWING OUT OF TOWN STORES 2011 Total Area on


Retailer B & Q


The Range B & M


Poundworld


Retail Parks 2011 Square Feet (Mln) 7.87 1.18 1.13


0.39 Home Bargains 0.71


Total Area on Retail Parks 2010 7.50 0.87 0.85 0.13 0.45


Change since 2010 0.37 0.32 0.28 0.26 0.25


from 107.61m sq ft in 2010. Comparison goods retailers increased their share of this desirable market to 59.5 per cent, up from 56.8 per cent in 2010 and 52.6 per cent in 2002. Peak rents achieved on retail parks range


from £8 per sq ft to £105 at Fosse Park, Leicester, with the majority of parks recording rents between £10 and £20 per sq ft. And the researchers discovered that 20 per cent of the current peak rents were set by occupiers that subsequently went into administration or entered into a CVA. On leisure schemes peak rents ranged


from £12 to £42.50 per sq ft and Cineworld, Frankie & Benny’s, McDonalds, Nando’s and Pizza Hut are present on more than 50 schemes. The development pipeline is not entirely


dry, and 82 schemes are thought likely to proceed before the end of 2018 including three Leisure Parks, 11 Leisure Schemes, 11 Shopping parks, 42 Retail parks and five Retail and Leisure Parks. To give this an historical perspective, of the 178 schemes that were scheduled to go ahead in 2006; 79 have now opened or are under construction; 26 are consented but not yet developed; 23 are still awaiting detailed consent and 50 were withdrawn by the developer or were refused detailed consent


%


Change 5%


37% 33%


204% 56%


Source – Trevor Wood Associates’ ‘The Definitive Guide to Retail & Leisure Parks 2012’ Trevor Wood, senior partner at a Trevor


Wood Associates, said: “The demand for space from the budget retailers and some more traditional high street stores means the out of town market remains in general good health. These retailers have taken advantage of the availability of large shops (often vacated by stores that have ceased trading) and which are easily accessible. More and more out of town retail parks resemble a traditional high street, without some of the negative aspects.” In other key findings, the guide identified 236 schemes that have development proposals of some kind, of which 174 are retail parks and 20 are leisure parks. The Middlebrook retail & leisure park in Bolton is ranked the UK’s top retail park while the O2 entertainment district in Greenwich is the top leisure scheme. The top retail warehouse cluster is at Westwood Road in Broadstairs. B&Q is ranked as the top retail park tenant while British Land is the top out of town investment manager. Savills is the top out of town managing agent while Wilkinson Williams is the top letting agent.


Find out more: For more information, please contact the author graham.parker@jldmedia.com


www.shopping-centre.co.uk April 2012 SHOPPING CENTRE


Retail Park units 124 30 77


48 67


Total units 358 62


280 165 270


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