M
aking your way through the centre of any major city while the country was in lockdown over the past 15 months, especially the business and commercial district, was undoubtedly a strange, almost eerie experience. Deserted and silent streets, empty of traffic and the normal bustle of office workers and commuters yattering into their phones or hurrying to and from appointments or the nearest station.
Retail
Although office lights were on in some buildings, you could see through the windows that there didn't seem to be anyone inside. As for visitors and tourists, they were a temporarily extinct species.
However, since the summer, slowly and very gradually, office life appears to be picking up again, but working from home still seems to be the preferred option for many, certainly for part of the week if not all of it. Quite whether life will ever return to pre-pandemic times is anyone's guess as companies take all this into account and review their accommodation requirements, many now choosing to downsize.
But where does all this uncertainty leave the many small businesses that fill the street-level units of many city office blocks or the ticket halls of the various tube and mainline stations? Sandwich and coffee shops, bars and restaurants, florists and dry cleaners, hairdressers and barbers, card shops and newsagents… all are small retailers who rely
on the day-to-day trade the office workers, commuters and visitors used to bring. Many are teetering on the brink of serious financial trouble, whilst many have already given up and closed down, unable to sustain their operation with too few customers and rising levels of debt.
It is estimated that 50% of retail rents from 2020 remained unpaid going into 2021, and of course, the lockdown continued for months after that. Resolution of this continues to prove painful, with landlords either aggressively chasing what is due to them or formally taking the pain themselves on their balance sheet. Meanwhile, at the beginning of August, amendments to planning regulations came in that should make it easier for change of use development from commercial to residential. The new class MA ('Mercantile to Abode') now allows the conversion of many empty Class E commercial premises into new homes without planning permission. Because of this, some landlords might take advantage of the planning law
change and decide not to renew the leases of some of their other surviving tenants because the prospect of conversion to residential property is an attractive and potentially profitable option. This could, however, add even more to the amount of vacant retail space.
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© CITY SECURITY MAGAZINE – AUTUMN 2021
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