UK Town Centre Retailing
Report description
Introduction
This report provides detailed ranking and information on the Top 100 GB towns and shopping centres, providing shopping populations, vacancy rates, sizes and more. Moreover, it includes data and trends for town centre retailing as a whole and by sector over the last 10 years and forecasts for the next five years, as well as comprehensive analysis of current and future town centre retail issues.
Features and benefits
- Market value and growth, space, sales densities and store numbers 2000-2011 with forecasts to 2014
- Comprehensive analysis of the pipeline of all shopping centre developments over 25,000 sq m due to open 2010-2017
- Review of performance of recently opened shopping centres, such as Union Square, Aberdeen and The rock, Bury
- Analysis of top 100 GB shopping destinations by 12 criteria including vacancy rates, size, proportion of AB shoppers and size of shopping population
Highlights
The role of the town centre is set to change, moving away from a predominantly retail channel to a more leisure-based centre. Coffee houses and restaurants are taking up a greater proportion of space in the town centre as they have the resources to continue groSales through town centres grew by just 0.2% in 2010, underperforming out-of-town and non-store retail, which both achieved significant uplifts. While out-of-town increased by 1.6%, non-store sales achieved exceptional growth, up by 10.4%. Town centre is less convenient and more exposed to discretionary sectors.London continues to benefit from its sheer size, impressive retail mix and high proportion of affluent AB shoppers, with a weak pound also helping to drive higher levels of tourism. Despite Scotland suffering, Glasgow has continued to draw in shoppers and retailers at the expense of other locations.
Your key questions answered
- What are the leading town centre locations and how they are performing relatively to each other and their own history?
- How are town centres performing as a whole and by specific retail sectors, both historically and moving forward?
- Which areas of the UK are set for development of their retail propositions and how are they likely to fare?
Table of contents
Executive Summary
Key findings
Role of town centre steers towards leisure
Town centre to remain retail's weakest location
Inflation a significant driver of growth in 2010
Space continues to contract in the town centre …
… with retail losing out to non-retail space
Forecast shows that town centre will continue to struggle
Wants-based sectors find it particularly difficult
Value and premium players apply pressure to midmarket retailers
Town centre retailers improve l-f-ls and sales densities
Councils try to stimulate growth in the town centre
North/south divide to become more prominent
London, Glasgow and Manchester comprise Verdict's top 3 town centres
RETAIL ISSUES
North-south divide emerges
A significant factor behind the divide is high levels of unemployment in the north
Unemployment levels to worsen as spending cuts take hold
New retail developments will not help north until 2014 at the earliest
London skews results towards the south
Resilience of non-retail in the town centre
More non–retail businesses take prime locations in town centres
Superior investment and greater consumer demand drives performance
Pawnbrokers are also benefiting from more austere times
Physical expansion of non-retail businesses to continue
The expansion of these business will have a significant impact on retail
Councils aim to improve performance of town centres
Creating a focal point for a community
Business Improvement Districts more common
Developing town centre infrastructure
Volunteer discount schemes
Attracting a big name retailer can create an upward spiral for a town centre
For this cycle to work however is highly dependent on the independents
Independents demonstrate new found resilience
Despite challenging conditions, the proportion of independents has increased in 2010
Independents have benefited from the collapse of larger retailers
Independents win through more personalised service and greater convenience
A potential backlash against larger retailers may have supported independents
However, it remains to be seen how long this revival will last
Landlord tenant co-operation still to reach potential
Despite pressure from significant players within retail, most retailers still pay quarterly rents
More successful retailers demanding parity is a factor behind the lack of concessions
The prospects on the high street are another sticking point for landlords
However, landlords aim to cultivate stronger relationships with tenants
Mutually beneficial for landlords and tenants to work together
STRATEGIES FOR SUCCESS
Retailers must focus investment wisely, with eye on the future
Landlords must act defensively on weaker space while exploiting demand for prime space
TOP 100 TOWN CENTRES & MALLS
Methodology
Top 10
Central London
Glasgow
Manchester
Birmingham
Leeds
Nottingham
Edinburgh
Newcastle
Norwich
Cardiff
TOWN CENTRE VS OTHER LOCATIONS
Town centre struggles in downturn
Retail sales by location
Slight return to growth indicates how challenged town centre sales are
Retail spend by location
Proportion of sales to out-of-town stores increases at the expense of town centre
Sales and sources of growth
Inflation and space growth have a significant impact on town centre
Space by location
Opening of shopping centres camouflages how challenged the high street is
Space has contracted sharply between 2005 and 2010
Opening of shopping centres partially obscures how challenged the town centre has become
Share of town centre space set to fall below 50% of total space for the first time
Clothing & footwear and health & beauty were the only sectors to see space grow
Sales densities by location
Despite improvements, town centre densities remain weakest out of all locations
Between 2005 and 2010, sales densities through town centre stores have improved the most
Changing focus of retailers and space falling out of the market are the main drivers behind this uplift
Despite this improvement, it still has the lowest density of all locations
Slowing growth in densities in 2009 illustrates how challenging the town centre was
Store numbers by location
Store numbers fall but location share consistent
The number of stores which operate in the town centre has fallen every year since 2003
While town centre stores have fallen, the number of out-of-town stores has risen
Despite this constant contraction, its share of total stores has remained constant
Forecast
Town centre especially affected by end of free spending era
Downturn hits town centre retailers hard
Sales set to recover as economy comes out of the downturn
Space and store numbers to continue to decline
Densities to improve as space contracts
Gap between town centre and overall retail spend to widen in 2014
Sluggish growth against weak comparatives illustrates how challenging the market is
Contracting space to dampen overall sales growth
Town centre dominance comes to a close
SECTOR SUMMARIES
Balance of sectors in town centre is evolving
BOOKS, NEWS & STATIONERY
Specialists under greater threat from grocers and online
Sales continue to decline, as growth of grocers and pureplays devalues market
Space severely affected by retailers entering administration
Negative trends in sales and space set to continue throughout the forecast period
CLOTHING & FOOTWEAR
Both sales and space contract in 2009 for first time since 2005
Sales contract for the first time since 2005
Administrations throughout 2009 also had a detrimental impact on space
Boost from more premium retailers set to aid sales growth in 2010
Smaller independents being forced out of the market set to impact space figures up to 2012
DEPARTMENT STORES
Sector to be strongest performing over forecast period
Changes to their offers and wealthy tourists help drive strong uplift in department store sales in 2010
Recovery of housing market set to boost sales at department stores
2010 sees significant space expansion
Department stores aim to open out-of-town stores
DIY & GARDENING
Experiencing the sharpest sales decline of all sectors on 2005
DIY & gardening remains the smallest sector in town centre retailing
Downturn has led to a contraction of space
Specialists increasingly aim to open in town centres
Once the economy improves, growth among DIY & gardening specialists will be marginal
ELECTRICALS SPECIALISTS
Store closures accelerate transfer of spend to other locations
Electricals less significant on high street
Store closures
FOOD & GROCERY SPECIALISTS
Arrival of major grocers driving higher densities and efficiencies
Larger grocers focus on high street
Switch to smaller stores
FURNITURE & FLOORCOVERINGS
Stagnating housing market and low consumer confidence scuppers market
Downturn brings double digit falls in furniture & floorcoverings sales
Space follows same pattern as sales
More affluent customer will drive recovery in 2012
GENERAL MERCHANDISE
Collapse of Woolworths has profound impact
GM prospects on high street remain weak after Woolworths collapse due to flight out-of-town
Single price point retailers have been the main beneficiary of Woolworth's exit …
… but what will happen to them once the downturn is over?
Wilkinson success continues
40% of Woolworths stores remain empty
HEALTH & BEAUTY
Resilient performance to continue
Health & beauty robust
Premium and ethical retailers perform well
Space set to remain relatively consistent barring a marginal dip in 2012
Recent buoyant performance to continue through forecast period
MUSIC & VIDEO SPECIALISTS
Sales transfer online – HMV last man standing on high street
Spend transfers online
Retailers diversify to compensate
WINNERS AND LOSERS
Performance of larger retailers hides how challenging the town centre is at present
Total sales
Major retailers perform well while others struggle in challenging markets
Operating profit
Profitability squeezed in current environment
Operating margin
Higher rents and costs put margins under pressure
Space
Growth slows for second year as retailers look to other channels
Sales densities
Increasing shift to out-of-town causing densities to decline
Store numbers
Contraction of Alliance Boots and Game leads to fall in key retailers store numbers overall
Advertising media expenditure
Retailers reduce spend on advertising by running more targeted campaigns
NEW RETAIL DEVELOPMENTS
Major retail developments in 2009–10
Strong performances, but at a cost elsewhere
St David's Centre II, Cardiff
Strong performance sees buoyant demand for space
Union Square, Aberdeen
Popular with shoppers, but retailers need persuading
The Rock, Bury
Impact on wider Bury yet to become clear
Eldon Square South, Newcastle
Achieves impressive letting rate right from the off
Other significant developments in 2009–10
Developments in the pipeline
Developments delayed in expectation of 2014 recovery
Westfield Stratford, London
Well placed to benefit from Olympics
Trinity Walk, Wakefield
Scheme restarted after falling victim to downturn
Developments in jeopardy
APPENDIX
Financials
Financial Statistics – VAT
Definitions
Abbreviations
Ask the analyst
Verdict consulting
Disclaimer
Key findings
Role of town centre steers towards leisure
Town centre to remain retail's weakest location
Inflation a significant driver of growth in 2010
Space continues to contract in the town centre …
… with retail losing out to non-retail space
Forecast shows that town centre will continue to struggle
Wants-based sectors find it particularly difficult
Value and premium players apply pressure to midmarket retailers
Town centre retailers improve l-f-ls and sales densities
Councils try to stimulate growth in the town centre
North/south divide to become more prominent
London, Glasgow and Manchester comprise Verdict's top 3 town centres
RETAIL ISSUES
North-south divide emerges
A significant factor behind the divide is high levels of unemployment in the north
Unemployment levels to worsen as spending cuts take hold
New retail developments will not help north until 2014 at the earliest
London skews results towards the south
Resilience of non-retail in the town centre
More non–retail businesses take prime locations in town centres
Superior investment and greater consumer demand drives performance
Pawnbrokers are also benefiting from more austere times
Physical expansion of non-retail businesses to continue
The expansion of these business will have a significant impact on retail
Councils aim to improve performance of town centres
Creating a focal point for a community
Business Improvement Districts more common
Developing town centre infrastructure
Volunteer discount schemes
Attracting a big name retailer can create an upward spiral for a town centre
For this cycle to work however is highly dependent on the independents
Independents demonstrate new found resilience
Despite challenging conditions, the proportion of independents has increased in 2010
Independents have benefited from the collapse of larger retailers
Independents win through more personalised service and greater convenience
A potential backlash against larger retailers may have supported independents
However, it remains to be seen how long this revival will last
Landlord tenant co-operation still to reach potential
Despite pressure from significant players within retail, most retailers still pay quarterly rents
More successful retailers demanding parity is a factor behind the lack of concessions
The prospects on the high street are another sticking point for landlords
However, landlords aim to cultivate stronger relationships with tenants
Mutually beneficial for landlords and tenants to work together
STRATEGIES FOR SUCCESS
Retailers must focus investment wisely, with eye on the future
Landlords must act defensively on weaker space while exploiting demand for prime space
TOP 100 TOWN CENTRES & MALLS
Methodology
Top 10
Central London
Glasgow
Manchester
Birmingham
Leeds
Nottingham
Edinburgh
Newcastle
Norwich
Cardiff
TOWN CENTRE VS OTHER LOCATIONS
Town centre struggles in downturn
Retail sales by location
Slight return to growth indicates how challenged town centre sales are
Retail spend by location
Proportion of sales to out-of-town stores increases at the expense of town centre
Sales and sources of growth
Inflation and space growth have a significant impact on town centre
Space by location
Opening of shopping centres camouflages how challenged the high street is
Space has contracted sharply between 2005 and 2010
Opening of shopping centres partially obscures how challenged the town centre has become
Share of town centre space set to fall below 50% of total space for the first time
Clothing & footwear and health & beauty were the only sectors to see space grow
Sales densities by location
Despite improvements, town centre densities remain weakest out of all locations
Between 2005 and 2010, sales densities through town centre stores have improved the most
Changing focus of retailers and space falling out of the market are the main drivers behind this uplift
Despite this improvement, it still has the lowest density of all locations
Slowing growth in densities in 2009 illustrates how challenging the town centre was
Store numbers by location
Store numbers fall but location share consistent
The number of stores which operate in the town centre has fallen every year since 2003
While town centre stores have fallen, the number of out-of-town stores has risen
Despite this constant contraction, its share of total stores has remained constant
Forecast
Town centre especially affected by end of free spending era
Downturn hits town centre retailers hard
Sales set to recover as economy comes out of the downturn
Space and store numbers to continue to decline
Densities to improve as space contracts
Gap between town centre and overall retail spend to widen in 2014
Sluggish growth against weak comparatives illustrates how challenging the market is
Contracting space to dampen overall sales growth
Town centre dominance comes to a close
SECTOR SUMMARIES
Balance of sectors in town centre is evolving
BOOKS, NEWS & STATIONERY
Specialists under greater threat from grocers and online
Sales continue to decline, as growth of grocers and pureplays devalues market
Space severely affected by retailers entering administration
Negative trends in sales and space set to continue throughout the forecast period
CLOTHING & FOOTWEAR
Both sales and space contract in 2009 for first time since 2005
Sales contract for the first time since 2005
Administrations throughout 2009 also had a detrimental impact on space
Boost from more premium retailers set to aid sales growth in 2010
Smaller independents being forced out of the market set to impact space figures up to 2012
DEPARTMENT STORES
Sector to be strongest performing over forecast period
Changes to their offers and wealthy tourists help drive strong uplift in department store sales in 2010
Recovery of housing market set to boost sales at department stores
2010 sees significant space expansion
Department stores aim to open out-of-town stores
DIY & GARDENING
Experiencing the sharpest sales decline of all sectors on 2005
DIY & gardening remains the smallest sector in town centre retailing
Downturn has led to a contraction of space
Specialists increasingly aim to open in town centres
Once the economy improves, growth among DIY & gardening specialists will be marginal
ELECTRICALS SPECIALISTS
Store closures accelerate transfer of spend to other locations
Electricals less significant on high street
Store closures
FOOD & GROCERY SPECIALISTS
Arrival of major grocers driving higher densities and efficiencies
Larger grocers focus on high street
Switch to smaller stores
FURNITURE & FLOORCOVERINGS
Stagnating housing market and low consumer confidence scuppers market
Downturn brings double digit falls in furniture & floorcoverings sales
Space follows same pattern as sales
More affluent customer will drive recovery in 2012
GENERAL MERCHANDISE
Collapse of Woolworths has profound impact
GM prospects on high street remain weak after Woolworths collapse due to flight out-of-town
Single price point retailers have been the main beneficiary of Woolworth's exit …
… but what will happen to them once the downturn is over?
Wilkinson success continues
40% of Woolworths stores remain empty
HEALTH & BEAUTY
Resilient performance to continue
Health & beauty robust
Premium and ethical retailers perform well
Space set to remain relatively consistent barring a marginal dip in 2012
Recent buoyant performance to continue through forecast period
MUSIC & VIDEO SPECIALISTS
Sales transfer online – HMV last man standing on high street
Spend transfers online
Retailers diversify to compensate
WINNERS AND LOSERS
Performance of larger retailers hides how challenging the town centre is at present
Total sales
Major retailers perform well while others struggle in challenging markets
Operating profit
Profitability squeezed in current environment
Operating margin
Higher rents and costs put margins under pressure
Space
Growth slows for second year as retailers look to other channels
Sales densities
Increasing shift to out-of-town causing densities to decline
Store numbers
Contraction of Alliance Boots and Game leads to fall in key retailers store numbers overall
Advertising media expenditure
Retailers reduce spend on advertising by running more targeted campaigns
NEW RETAIL DEVELOPMENTS
Major retail developments in 2009–10
Strong performances, but at a cost elsewhere
St David's Centre II, Cardiff
Strong performance sees buoyant demand for space
Union Square, Aberdeen
Popular with shoppers, but retailers need persuading
The Rock, Bury
Impact on wider Bury yet to become clear
Eldon Square South, Newcastle
Achieves impressive letting rate right from the off
Other significant developments in 2009–10
Developments in the pipeline
Developments delayed in expectation of 2014 recovery
Westfield Stratford, London
Well placed to benefit from Olympics
Trinity Walk, Wakefield
Scheme restarted after falling victim to downturn
Developments in jeopardy
APPENDIX
Financials
Financial Statistics – VAT
Definitions
Abbreviations
Ask the analyst
Verdict consulting
Disclaimer
Related market research by market
United Kingdom (in Europe)
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