29th Jan 2021 05:15
(Alliance News) - Shop vacancy rates in the UK rose yet again at the end of 2020, according to the latest numbers on Friday, in a "stark reminder" of the retail sector's mire.
In the fourth quarter of 2020, the vacancy rate rose to 13.7% from 13.2% in the third quarter. Figures from the British Retail Consortium-Local Data Company monitor also showed the vacancy rate was 1.6 percentage points higher annually.
It was the tenth consecutive quarter of rising vacancy rates, the BRC noted.
In shopping centres, vacancy rates rose to 17.1% from 16.3% a quarter earlier. In high streets, vacancy rates increased to 13.7% from 13.3%, while in retail parks, they rose to 10.0% from 9.2%.
"With the country in and out of lockdown, the forced closures of thousands of shops, and consumers reluctant to visit town and city centres, it is unsurprising that the number of shuttered stores continues to rise. Over the past two years, one in every 50 outlets has permanently closed, and this number will only go up," BRC Chief Executive Helen Dickinson said.
The vacancy rate increase came during what is usually a bumper quarter for the UK retail sector, though events like Black Friday and Boxing Day sales were more muted affairs in 2020 due to lockdown restrictions.
Dickinson added: "The big increase in vacancy rates during the crucial golden retail quarter, when demand is usually high, serves as a stark reminder of the pandemic's impact. Social restrictions and their knock on effect on consumer appetite for fashion, has meant that shopping centres are still faring the worst due to their high proportion of clothing outlets. What's more, due to economic uncertainty, many retailers have paused their plans for future investment in new stores."
Poor market conditions in 2020 have seen UK retailers such as Peacocks and Jaegar-owner Edinburgh Woollen Mill, Debenhams, and notably Topshop owner Arcadia Group slip into administration.
Online retailers ASOS PLC and boohoo Group PLC on Monday unveiled plans to swoop in on the struggling high street retailers.
boohoo said it has acquired all the intellectual property assets of department store chain Debenhams from its joint administrators for GBP55 million in cash. The company will only be acquiring brands and associated intellectual property rights. The deal does not include physical Debenhams retail stores, stock, or any financial services.
ASOS, meanwhile, confirmed that it is in exclusive discussions with Arcadia's administrators over the acquisition of the Topshop, Topman, Miss Selfridge and HIIT brands.
LDC Head of Retail & Strategic Partnerships Lucy Stainton said: "With recent announcements from the likes of Debenhams and Arcadia, the size of the stores coming onto the market will present a real challenge given the likely lack of demand for larger high street units. With a limited number of new store openings, structural solutions will need to be found to prevent these vacant units lying empty for two, three, four years or more."
By Eric Cunha; [email protected]
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