Sector Focus
Mailbox seeks £62.5m flotation
Owners of the Mailbox plan to raise £62.5m by floating the development on a new property stock exchange. Mailbox REIT, a newly
formed organisation which owns the Mailbox, will be the first single asset REIT (real estate investment trust) to be listed on the International Property Securities Exchange (IPSX), a dedicated exchange for commercial property. It intends to raise funds via
an initial public offering on the IPSX. M7 Real Estate will act as asset manager and retain indirect ownership of approximately 46 per cent of the company’s share capital after admission. The Mailbox is a 698,000 sq ft mixed-use property, which houses the BBC, Harvey Nichols and Malmaison among its tenants. In May the property was
granted planning consent to convert its first level from retail to 50,000 sq ft of office space. Five million of the £62.5m raised is expected to be invested into this project. Richard Croft, executive chairman of M7 Real Estate, added: “After almost a decade of record low interest rates and no sign of any change to that status quo, we have an environment where investor appetite for asset backed investments underpinned by high quality income is arguably stronger than ever before. “We are therefore firm
believers in IPSX’s potential to help alleviate that demand, while at the same time transforming and democratising real estate investment, by making prime landmark assets such as the Mailbox available to all types of investors, large and small, through liquid shares that are tradeable on a new regulated stock exchange.” Stephen Barter, chairman of
Mailbox REIT, said: “Mailbox REIT offers an attractive dividend underpinned by the long dated income streams derived primarily from globally recognised, high-profile and low risk tenants as well as the anticipated income and valuation enhancement resulting from planned asset management initiatives.”
58 CHAMBERLINK November 2020
Retail
Tax-free shopping move would bring ruin – report
An end to tax-free shopping could mean up to £6bn being lost, through a fall in tourism numbers and spending, according to a major new report from Centre for Economic and Business Research (Cebr). According to Cebr, the move by the Chancellor to cut
tax free shopping on 1 January 2021 could also trigger up to 138,000 manufacturing, retail and tourism job losses across the whole of the UK. According to the report, Birmingham is projected to lose £14m and 280 jobs.
‘This decision makes no sense when both retail and tourism are under the cosh’
The report also found that out of a poll of 4,800
overseas travellers, six in ten (62 per cent) would now be less likely to visit the UK as a direct result of the removal of tax refunds for overseas visitors from outside the EU, with 93 per cent less likely to buy goods in the UK. Douglas McWilliams, Cebr, said: “This decision makes
no sense when both retail and tourism are under the cosh. It will cost the Treasury money – a minimum of
£250m and probably a whole lot more. It will reduce tourism. And it will reduce retail activity draining jobs from suppliers all around the country. Instead it would be better to extend the scheme to EU tourists, bringing in nearly a million additional visitors to the UK and boosting tax revenues from the additional income tax, national insurance, corporation tax and VAT on other items of tourism and spending.” Before Covid-19, international visitors spent around
£28.4bn in the UK, £2.5bn of this on tax-free shopping. Visitors pay VAT on the other £26bn, raising £5.2bn for the Treasury. In contrast, were the Government to extend the scheme to EU visitors after Brexit, Cebr’s economic modelling indicates that visitor numbers would increase by 948,000, tourist spending by up to £890m and an additional 20,200 jobs would be created. The Chamber has backed Cebr’s findings and called
on the Chancellor to reverse his plans. Chamber chief Paul Faulkner said: “The decision to
remove the VAT retail scheme has been met with widespread disbelief across the local business community. The latest research published by Cebr makes it perfectly clear that this decision will have a direct and devastating impact on the economy of Birmingham.”
Christmas creativity is needed
Known as the ‘Golden Quarter’, October to December is the most valuable period in the retail calendar, with 25 – 30 per cent* of all annual sales driven by the festive period (*British Retail Consortium). In a typical year, more than two
thirds of UK consumers would prefer to spend this time browsing high street stores in person rather than online. However, as a Covid- Christmas begins to come into sharp focus, it has never been more important for retailers to be creative, agile and responsive in order to reinforce a safe-shopping message and encourage customers’ safe return to stores. Over the past six months, we have
seen how behaviours have adapted with a newfound reliance on technology – from Zoom shopping consultations, to virtual ‘try-before- you-buy’ experiences, ecommerce has taken a significant leap forward in a very short space of time. But this isn’t the first occasion that digital platforms have challenged the high street, and demand for physical stores certainly don’t look set to disappear. Bricks and mortar locations still
play an incredibly important role in creating a unique customer experience, and successful retailers will understand just how much value is placed on shopping as a leisure activity, with human and product interaction, as opposed to a transaction born out of necessity.
Retail Therapy
By David Pardoe Head of Marketing, Retail and Tenant Engagement at the Mailbox
Industry stalwarts such as Harvey
Nichols, which holds pride of place at the Mailbox, continue to deliver success with this thinking. By creating and nurturing relationships with brands, influencers and customers in bolstering its in-store offering, Harvey Nichols has positioned itself as a destination more than anything else. With an on- site bar, fashion concierge, beauty salon, makeup counters, food market and more, the store delivers an exciting and personalised experience from the moment you walk in through its Instagrammable light tunnel. Although Covid-safe measures
have limited personal contact to a certain extent, being able to understand what excites your customer as and when their needs
change in the lead up to Christmas, will be key to establishing brand loyalty and ensuring long term success. Following months of lockdown, post-pandemic behaviours will undoubtedly be driven by the prospect of human and product interactions. Over the coming weeks, retailers
can still seize the opportunity to grow their business and use stores to enhance digital services. The initial period of lockdown exposed weaknesses within some retail supply chains, particularly with elements of replenishment and stock running dry. Logistically, retailers can utilise additional in-store space to hold surplus product, introduce new click-and-collect services, and even reduce the distance for last mile deliveries where warehouses are few and far between. With the Golden Quarter expected
to create a renewed surge in demand, we have already seen how retailers have brought festive lines forward, giving customers the chance to take a different approach with their Christmas shopping. It is expected that there will be many more ‘planners’ versus ‘last-minuters’ this season, which has already been demonstrated with more online searches for Christmas gifting over recent months compared to last year. In turn, creating the opportunity to stock up on gifts early can ensure a quieter, safer and more enjoyable shopping experience for all.
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