Is Two Years a Lifetime in Retail Property?
Posted by Mark Robinson on 16th Apr 2014
Harold Wilson reportedly said that “A week
is a long time in politics” and certainly two years is a long time in the
dynamic, fast moving world of retail; which is why I love my industry so much.
However I was slightly taken aback by an
article tweeted by the excellent Neil Saunders (@Neil Retail) this
morning. Neil is the MD of retail
consultancy Conlumino and either has a sleep disorder or loves retail so much,
he wakes up in the early hours to tweet links to interesting retail stories in
that days press.
It saves having to trawl through the papers each day yourself!
But let’s keep this as our little secret as
the guys in the office have no idea how I am so well informed each day…..
This morning he tweeted at link to this
The summary is that “high streets and town
centres outside the major cities are currently uninvestable”
Which is a proposition that is clearly not true
and even if it were, I would be manning the barricades to try to change things.
Unlike Accessible Retail and others, I
believe our communities are too important to leave to rampant open market
forces, as I have said many times.
And I am right.
What particularly pricked my interest was
that the article paraphrased, Andrew Jones, CEO of London Metric plc and
probably the most successful retail property man of my generation. Admittedly Ellandi and Metric have a little
spat going on in Cornwall, but more of that later…..
This sentiment seems a long way removed
from this opinion piece from two years ago for Property Week:
Which he self summarises with “the right
size shops, in the right towns, at the right rent, is a formula that has a
better chance of success today than many might have you believe.”
Now things have changed markedly in two
years, however it’s not for the worse.
Certainly where towns have been invested in
they are now reaping the benefits; for example vacancy rates in Kettering have
halved in this time.
What Andrew fails to acknowledge is that
the biggest threat to town centres, although not the sole one, is massive
expansion of Out of Town Retail space, which brings us back to St Austell.
Here Metric have recently failed to get
planning for 285,000 sqft of Open A1 consent, a development called Coyte
Farm. This proposal is not only
considerably bigger than the retail provision of the entire existing town, it
would in fact make this Out of Town retail park the 3rd biggest
retail centre in Cornwall.
But in a
They promise to come back for a second bite
of the cherry and throw enough money at it to get it through. I don’t doubt
that they will try.
However what worries me is that should they
succeed, not only St Austell, but Newquay, Bodmin, Liskeard and Wadebridge will
be blighted for a generation and a generation is a mighty long time in
In a febrile market where yesteryears Out
of Town hypermarkets, beloved of the big four grocers until practically months
ago are now dragging down their performance and retail property experts like
Andrew change their minds every two years, playing Russian Roulette with
existing and improving town centres is very short term indeed.