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London retail redevelopment picks up as prime locations enjoy stable void rates

22 02 22 London redevelopment picks up as prime locations enjoy stable void rates hero

Retail space that is under redevelopment in the West End has risen to 101,000 sq ft according to new research from Colliers.


This figure is up considerably from the 31,000 sq ft recorded in December 2019 and 49% up on the five-year average.

The research reveals that units housing global brands are less impacted than others, and super prime portions of pitches look largely unaffected. This was especially apparent on Kings Road where the Duke of York Square was 100% occupied. Regent Street shows a unit void rate decline from 10% in December 2019 to 8.4% in January 2022 which occurred after a 13% peak in July 2021. Pitches reliant on local workforces are harder hit and in reaction some retailers have reduced or changed opening days and hours to capture the highest rates of footfall.

Paul Souber, head of Central London Retail at Colliers, comments: “The retail void rate in central London can’t be explained by one factor, as each pitch has its own character and mix of brands. One thing that has contributed, particularly on Oxford Street is the loss of the department store. While these are being redeveloped, the projects will take time and as such will keep the headline rates high. Elsewhere, void rates need to be managed with great care to ensure that the right occupier is put in place that compliments the location be that a pop up, new entrant or a brand looking for rightsized space.”

Cheapside was hit hard with the unit void rate rising from 3.4% in 2019 to 24.8% in 2022. However, Colliers anticipates Cheapside and other City locations will recover rapidly as the movement of workforces back into the office continues apace.

Flagship stores housing global brands look less impacted than others, and super prime portions of pitches look largely unaffected. As a result, shopping ‘destinations’ such as in Bond Street, Regent Street, Kings Road and Long Acre fared better. This was especially apparent on Kings Road where the Duke of York Square was 100% occupied. Kings Road is largely unaffected with a unit void rate up marginally from 5.3% in 2020 to 6.6% in 2022. 

Kensington High Street was also one of the few pitches to witness a falling unit void rate from 14.5% in 2020 to 12.5% in 2022. This corresponds to a floorspace vacancy rate of 8.7%, slightly lower than the West End average of 9.3%. Given the local affluent demographic of the Kensington High Street area and the work from home environment, Colliers notes a resurgence in new lettings on the High Street as brands take advantage of rebased rents and expects footfall to surge in the area as local commuter and international travel increases.

Walter Boettcher, head of Research and Economics at Colliers, adds: “While void rates remain generally high, movement looks to be in a positive direction. The surge in refurbishments across the pitches bodes well, providing opportunities for new market entrants and the possibility of repositioning high streets generally. Despite an obvious ‘pandemic hit’ to London’s key retail destinations, punctuated by ubiquitous ‘pop up’ shops, few signs of a lasting upheaval are evident.”

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Related Experts

Walter Boettcher

Head of Research and Economics

Research and Forecasting

London - West End

I am the the Chief Economist at global property advisors Colliers International based in London.  I am a research economist identifying timely research topics and directing research and forecasting outputs.

I have over 20 years UK and European property industry experience and extensive expertise across a wide range of property sectors and related industries.

I participate regularly in industry panel discussions, but am focused more on direct client engagement with institutions, property companies, banks, and private investors. A regular media commentator, I have a wide range of national and broadcast experience.

I joined Colliers International in August 2007 after several years at a private property company where he was responsible for managing a mixed portfolio of London residential, retail and office assets.

Previously, I worked in a few London property advisory firms, a geodemographic company as well as a few youthful sojourns in the US offshore oil industry, local government and entertainment business.

I am an economics graduate of the University of Texas at Austin and received his PhD from the Faculty of Science at University College London.  I am a member of Lambda Alpha International and the Society of Property Researchers.

Perhaps best known for my alternative take on property economics and investment, I am a keen proponent of UK regional development and infrastructure investment.

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Paul Souber

Co- Head UK & EMEA Retail

Retail Agency - Central London

London - West End

Paul Souber is a highly experienced London retail property expert, and has a particular specialism in the luxury sector.

He advises major London landlords – including The Crown Estate, Grosvenor, The Church Commissioners and Shaftesbury Plc – on how their retail holdings in the capital can be enhanced through leasing and placemaking.

His consultancy also involves advising various leading brands on their property strategy and sourcing the stores which best serve their strategic needs.

During a career in which he has advised on the leasing of more than 1.5m sq. ft. of shopping space, Paul has worked with clients including Yves St Laurent, Roksanda Ilincic, Gina Shoes, Balenciaga, Oliver Bonas, Boux Avenue, Sweaty Betty and Headmasters.

He is Head of London Retail Agency and Co Head of the EMEA Retail Team at Colliers International

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Hannah Zitren

Associate Director

Marketing & Communications

Manchester

I am responsible for media relations and generating coverage in top tier broadcast and print media. I work across a range of Colliers’ UK & Pan-EMEA business lines advising on their strategic and tactical PR needs.

My role includes:

·         Developing and executing PR plans for the various business lines to help promote their key messages across all aspects of the media - print, broadcast and social.

·          Media evaluation and reporting objectives, targets and successes across the business.

·         Reputation management and crisis management.

·         Media training.

·         Media engagement: setting up meetings with top tier media and various internal spokespeople to continuously expand and build a presence with property and vertical media network.

·         Consistently delivering service excellence, meeting with business heads of a regular basis and trying to influence the research as much as possible to ensure our content has a strong enough news hook.

·         Key campaigns that I work on include MIPIM; MAPIC; REVO; Midsummer Retail Report; IHIF; Cities of Influence in addition to a host of all alternative property sector research reports.

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