UK Town Centre Vacancy Rates Reach 'Highest Level In Four Years': BRC
Town centre vacancy rates in the UK hit 10.2% in April, their highest level for four years, according to the latest British Retail Consortium (BRC) Footfall and Vacancies Monitor.
According to Helen Dickinson, BRC chief executive, the vacancy rates should "come as no surprise" given the regular reports about shop closures.
"Empty shopfronts, particularly for larger stores, can deter shoppers from an area, decreasing footfall for all those around," she said. "This effect can be cyclical, with the long-term decline in footfall pushing up vacancy rates, particularly in poorer areas."
Dickinson added that the "cumulative impact" of government policy costs, such as business rates and the apprenticeship levy, have made physical retail space less cost effective.
“For many retailers, business rates remain the single biggest tax imposed by government," she said. "They are a levy on physical space that is paid in full regardless of whether a firm is in profit or in loss. Importantly, they are also borne disproportionately by retailers who represent 5% of the economy yet pay 25% of all business rates."
Footfall for the month of April was down 0.5% compared to the same month the previous year, with high street footfall down by 1.0%. This was despite the later falling of Easter this year, the BRC noted.
“On a more positive note, the +2.2% increase in footfall in retail parks in April was the highest since June 2017 and indicates that the British tradition of spending time and money on our homes and gardens during Spring endures," said Diane Wehrle, marketing and insights director at Springboard, which produces the monthly footfall report alongside the BRC.
"Despite weak comparables for high streets and shopping centres in April last year, footfall in both failed to bounce back and their footfall is now at a lower level than in 2017; 5% lower in high streets and 5.6% lower in shopping centres," she added.
Commenting on the BRC's findings, retail analyst Clive Black wrote that the figures indicate that the retail environment 'remains competitive and challenging, terms frequently appearing in stock market trading statements.
'An improved political backdrop would undoubtedly help the mood, but the reality also remains that the moving parts of consumer behaviour are likely to act as a constraint on demand too.'
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.