Shopping centre vacancy drops
Published: 15 July, 2016
UK sees a 43 per cent increase in demolition of unoccupied units
There has been a 43 per cent increase in the number of vacant units being demolished in June 2016 compared to the same time last year (June 2015) according to Local Data Company (LDC).
The number of persistently vacant units – a unit vacant for longer than three years – decreased in June by -189 units (-1.6 per cent), when compared to the start of the year (6 months). The GB average for the percentage of all units that have been vacant for over three years is 4.4 per cent.
Britain’s shop vacancy remained at 12.3 per cent in June, the lowest since November 2009. This is down -0.5 per cent from the same time last year (June 2015). This change was driven by an increase in the number of new units (up +13 per cent from June 2015) and an increase in the number of vacant units demolished (+43 per cent, when compared to June 2015). The report covers shopping centres, retail parks and town centre vacancies.
The GB shopping centre vacancy rate (13.2 per cent) dropped by -1.6 per cent in June 2016, when compared to the same period last year (June 2015). GB shopping centres saw the biggest drop across all the location types. The West Midlands (-2.2 per cent) and North East (-3.8 per cent) saw the biggest fall in their vacancy rates across the GB nations and regions. Wales was the only area to see a rise in its vacancy rate of +0.4 per cent in the last 12 months since June 2015. This is a recurring trend from the last four monthly vacancy reports.
The North East has the biggest percentage of its total units that have been vacant for greater than three years (7.3 per cent). The North of England continue to have the largest percentage of total units vacant for over three years. Overall the situation is getting better with the GB rate down -0.1 per cent from the start of the year, with the North West having the biggest drop of -0.3 per cent in this 6 month period (January to June 2016).
Matthew Hopkinson, director at LDC commented: “The increase in demolished units that the LDC shows is a positive sign of structural change and is what is required in many locations up and down the country. Short term vacant units are not the issue; it is units vacant for longer than two years that indicate oversupply and detract from the health of a location.
These numbers do not reflect the Brexit fallout which will take time to show in the data as a result of any change in openings or closures and thus the take up or not of vacant units up and down the country. With retailer and leisure operators being challenged by profitability as a result of increased costs and competition, coupled now by a significant drop in consumer confidence, then one would expect that change to be afoot.”