October 12, 2015
Vacancy rates for retail warehouse space in the UK are at their lowest level since the end of 2004, according to the latest research from leading retail property research consultancy, Trevor Wood Associates. The findings show that rates have continued to fall from 8.0% in Q2 2014, down to 6.4% by mid 2015, due in part to expanding retailers such as B & M, The Range and Home Bargains looking for good value bulky-goods units.
Trevor Wood Associates revealed that East Anglia has the lowest vacancy rate in the UK at just 3.4% and Northern Ireland the highest at 9.7%. The top three direct property owners within the retail park market at the end of Q2 2015 remain British Land, Hammerson and Land Securities.
Trevor Wood comments, “Fortunately, the number of major administrations and receiverships has abated recently and a significant amount of space on retail parks has been taken by expanding retailers such as B & M, The Range and Home Bargains who have all occupied more than one million square feet of retail park floorspace since 2010, as well as a considerable number of freestanding units.
“It is interesting to note the number of retail park units occupied by the leading tenants. B & Q have by far the most floorspace but only occupy 127 units although this is likely to change given recent announcements. Pets at Home have the largest number of Retail Park units at 318, closely followed by Carpetright with 298 and Next with 262 units.
“Since the recent peak of 10.0% in mid 2013, the vacancy rate has continued to reduce despite disposals, relocations and downsizing by retailers such as Homebase, PC World and Tesco Home Plus that released over one million square feet in the first half of this year alone. By mid 2015 the retail warehousing vacancy rate (including both free-standing units and parks) had fallen from 7.1% to 6.4%.
“This seems set to fall further by the end of the year, given the number of units currently under offer. In mid 2015 we calculated the Open A1 vacancy rate as 5.8%, compared to 7.6% in mid 2013 with Open Non Food units falling to 7.0% from 10.5% and bulky goods or restricted units dropping to 6.5% from 11.5%.”
Trevor Wood Associates’ Definitive Guide to Retail & Leisure Parks reviews the out of town sector’s annual performance at the end of each year, although some key tables are updated mid-year.