As several major retailers are having to downsize in the current economic climate, new figures suggest budget chains such as Aldi and Lidl are driving an increase in take-up at Scotland’s retail parks.
Property advisor Savills’ latest report indicates that opportunities have been created for budget chains away from the high street as the number of out-of-town retail centres for let has increased eight per cent on the long-term average.
According to the study, major brands have been forced into administration and company voluntary arrangement plans (CVA), leaving behind vacant retail park spaces on a ‘constrained’ market.
Dubbing 2018 ‘the year of the CVA’, Savills noted brands such as Homebase and New Look (who had a dominant presence in retail parks) opted in favour of a CVA, while the likes of Toys R Us fell into administration. However, while some brands are struggling amidst a surge in online retail, the release of vacancies in retail parks generated interest from companies like The Range, Home Bargains, Iceland and B&M.
Director in the out of town retail team at Savills, Mike Spens, believes the survival of retail parks is because the products usually sold there – furniture and kitchens for example – are items that customers want to look at before purchasing. Spens went on to point out that those who are continuing to thrive in such areas “do not offer the ability to buy online and therefore the focus for them remains on physical stores.”
Despite negative press coverage about the out-of-town retail market being in ‘distress’, Associate Director in Savills research team, Sam Arrowsmith, explained that “in reality, only roughly 3% of units in the UK out of town market were affected in 2018”. Arrowsmith concluded that the uptake of these spaces “shows signs of a retail revolution rather than a recession”.
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