By Ursula Mayers MRICS
Founder/Owner, Mayers Real Estate
For a decade we have watched as our town and city centres have taken a blow in terms of their popularity among retailers and consumers. I don’t believe the downward surge in the uptake of retail space is a choice that retailers happily take, rather it is bestowed upon them by a series of factors which are out with their control.
As the ashes cool on our much loved Bank Buildings which housed one of the UK’s longest standing retailers, Primark, there is a deep irony of our town and city centre retail sector going up in smoke.
The Internet of Things, the rapid rate at which technology is moving and catering for our every whim, the change in how the consumer prefers to acquire their merchandise and the themes of comfort and convenience are dictating the landscape of the new and ever emerging “retail playing field”.
The traditional physical retail offering of Shopping Centres and out of town retail parks are driven by teams of experts who are watching the markets, observing trends and adapting their product in line with the consumers desire to have an experience. These business models have evolved into impressive mixed use developments to include cinemas, entertainment, competitions, leisure, health and fitness, food and drink and all underpinned by a strategic, relevant and complimentary retail offering. These experts are profiling their consumer and analysing their offering on a daily basis in order to keep ahead of the curve and drive the investment potential of their schemes. It is paramount that occupiers of these private investment assets meet the criteria of the scheme and also that the scheme is capable of delivering profitability for its tenants. This means that landlords step out of their traditional hierarchal role and shift to having a partnering relationship with their tenants. The playing field is very much a two way street requiring commitment from all parties involved in the management, promotion and sustainability of the asset.
Landlords have a vested interest in the profitability, viability and sustainability of their tenants. To this end, they are engaged and deploy the correct expertise to nurture and preserve the investment long into the future.
And all of that before we even touch upon the hundreds of either free or reduced rate parking spaces, the on site security presence, the street scapes and/ or interior décor, the events and seasonal offerings. The attention and considering which is investing on enhancing the consumer experience is second to none.
There is of course the non-physical retail offering which is The Internet of Things (IoT). As the demand for retail space depletes, the demand for warehouse space globally is on the rise. Hardly surprising when pretty much any retailer you care to mention has an online presence as consumers we are turning to online purchases more and more. We acquire our insurances, holidays, home wares, gifts, bulky goods, bespoke goods, food shopping, dry cleaning, mobile phones, fast food the list is endless.
This is not a complicated concept. Put simply, its called change. The internet has broken down borders and joined the retail world together in a single huge online market.
Everyone these days is striving for a better lifestyle and experiences. We want to have an experience in almost everything we do which ultimately improves our sense of lifestyle. Real Estate plays a huge role in delivering upon lifestyle for the consumer, the employee, the house hunter, the tourist.
In more recent years, the physical retail sector has seen out some of our big brands either vacate the landscape completely or cull their physical presence. Toys R Us and Maplin have gone from our High Street, New Look is closing 60 branches, Mothercare have taken the decision to close 50 outlets and Homebase has now started to make noise about financial losses. House of Fraser are the words of everyone’s lips, need I say more.
Suffice to say, the statistics are telling us that our city and town centres are not competitive. Turn on your radio or television or should I say, wireless headphones and youtube, and learn about the concerns of the retailers who have been directly impacted by the Primark closure. Roads are closed, footfall as disappeared from their shop fronts, jobs have been lost and all of this within the context of “struggling high streets”. Thankfully LPS have released a statement saying they will consider the rates liability due from retailers who have been impacted by the disaster. Let’s hope that they will do more than a visual assessment and offer these business a solution which affords them some hope and opportunity to continue to maintain their High Street presence. We need them to keep the lights on and keep fighting to keep our High Streets occupied. If we fail to maintain what we have already, the stark reality is that supply would far outweigh demand and we could be faced with even more void space than can be seen already.
The RICS have just launched a consultation called “The future of the Profession” during which they are calling for us professionals to assist in seeking to “identify trends within the marketplace and showcase how the profession must adapt so that it can continue serving the public interest in the decades to come.”
I am observing that key stakeholders and professionals working within our built environment are alert to change and diversification and committed to driving real estate forward both in terms of improving upon our own professional development and developing partnerships which allow us to leave a legacy for future generations.