Towards the end of last week the retail news was rather dominated by a Deloitte report based on Local Data Company data (The changing face of retail: where did all the shops go?) suggesting that the death of the high street was somewhat premature. As Deloitte states “the high street (is) emerging as an unexpected winner” and “the high street seems well positioned for a strong recovery”
This, perhaps surprising, conclusion was based on Deloitte’s analysis of 5,900 shops from 27 retail administrations since 2009, and who, what and when they were re-occupied, re-used or demolished. The full report contains much interesting material and many interesting thoughts.
The headline figures were that only 20% of high street shops closed by these administrations remain vacant today, compared with 37% and 29% for retail parks and shopping centres respectively. Ergo, the high street wins.
For me, it is a strange victory when 1 in 5 (20%) of these high street shops remain vacant i.e. above the national vacancy rate. But, we’ll return to that.
The data for this work was provided by the Local Data Company and Matthew Hopkinson has, in his always interesting and informative blog, usefully provided the Deloitte press release and his own short commentary.
His blog lists the 27 administrations, which in themselves make interesting, if sobering, reading. Matthew also makes a number of points, most notably the time taken to re-let/re-use (and this despite some big block deals) and the ways in which showrooming/online may be affecting off-centre “big boxes”
This latter point was developed by Deloitte, but they also focus on the ways in which discounters (pound shops) and supermarkets have led the race for in-town space. They also note that, perhaps contrary to public/media perception, these administration stores have not been massively taken over by bookies, pawnbrokers or charity shops (3% of the total). The latter in particular they note are challenged by the pound shops and convenience stores entering the high street space.
From a Scottish perspective most worrying is the fact provided that Scotland has the highest administration shop vacancy rate of all GB areas at 37% (London was the lowest at 18%, and Northern Ireland hit 50%). It would be interesting to delve more deeply into these Scottish figures, both in terms of spatial and structural analysis. One could speculate about the particular Scottish town scape that is playing a particular role here. That will have to wait for now until more data becomes available.
So, does the press release and the media coverage accurately reflect the figures I have seen? I fear that this was a slightly spun story focusing on positive news for the high street. This positive news is only relative. Is it good that high streets did better than retail parks and shopping centers? If you believe in towns, then yes. Is it surprising or does it necessarily signal the rebirth of the high street? Not in my view.
We have known for some time that some retail parks and shopping centres are in trouble. I have written about it here before in the context of The Gyle in Edinburgh. This is the structural change in retailing and not a recessionary effect alone. Just look at vacancies in shopping centres (and it was the same in Livingston last Friday) and in retail parks across the country. As an aside, an interesting point in the full Deloitte report is that the managerial structure and often single ownership of sites away from high streets can lead to faster adaptation and more varied outcomes.
On the other side of this structural change is the drive for value and convenience and the chase for footfall by many retailers. This has driven the move back into these administration stores in high streets. Take away the pound shops (c20% of all re-lettings and re-use of these administration stores) and the figures look very different. Despite this massive reconfiguration and reconstruction of retail, 1 in 5 high street administration shops are still vacant.
Are we thus being a little premature in comments from this story such as “things aren’t quite as gloomy on the High Street as some people might think“. Perhaps there are some small shoots in some places, but there is a long way to go yet. If you want, you can make your own mind up on this really interesting topic by reading the full report.