LONDON--(BUSINESS WIRE)--EG, the market-leading supplier of data, news and analytics products and services for the commercial real estate market, has reported that an increase in home-based office workers will boost local economies, but that increasing retail obsolescence will only accelerate in coming years due to new government environmental policy.
As retail casualties continue to dominate the news and the amount of vacant space nudges close to 30m sq ft, new EG research reveals the places that are set to win and lose from a new retail revolution.
This year has witnessed the highest number of shop closures since 2004, with some 6,000 premises closing their doors in the first six months of 2020 alone. But a new, in-depth investigation from EG using its specialist Radius Data Exchange and Propertylink data sources, offers the most complete look at both the pain and the potential from a retail sector in flux.
Places and spaces that had traditionally been residential areas with key spenders commuting to more traditional work areas could become new retail hotspots, according to EG’s research. Its analysis highlights South Gloucestershire, Lewes and Bristol as places where retail may actually grow as a result of the pandemic.
Report author and head of retail research at EG, James Child, said: “By looking at how many office employees live in a particular local authority, compared with where they work, we can gauge the effect that a lack of commuting in and out of satellite towns into central urban hubs will have, and begin to separate out potential winners and losers.
“An increase in home-based office workers should boost the local economy, as their time and money are not leaking via the daily commute to a different locale. On the flipside, those areas that benefit from high levels of commuting workers and already have a substantial footprint of successful retail built around this model look set to struggle.”
EG’s Retail Disrupted: The pain & the potential report also reveals:
• The number of retail properties coming to market has increased by 40% year-on-year with some 7,500 empty units looking for a new occupier.
• Lease lengths have fallen by 28% over the past decade, with average rents dropping by 27%.
• Planning permissions to develop new shops has fallen by 50% with over applications for new space dropping by 70% over the past four years.
• The speed of permission for shops has increased from 143 days to just 78.
• 975m sq ft of retail space is at risk of being handed back to landlords over the next five years.
'Winners' in respect of retail performance as a result of working patterns shift
Winner /
|
Local
|
Indicative
|
Deprivation
|
Resident
|
Share
|
Share of
|
Region |
Winner |
South Gloucestershire |
45.4% |
11.62 |
£ 21,979 |
34.0% (5) |
61.9% (3) |
South West |
Winner |
Lewes |
36.4% |
15.76 |
£ 23,363 |
43.3% (2) |
68.7% (2) |
South East |
Winner |
Bristol, City of |
33.5% |
26.25 |
£ 19,692 |
39.2% (3) |
65.2% (2) |
South West |
Winner |
Tewkesbury |
32.0% |
12.10 |
£ 22,531 |
22.3% (9) |
62.2% (3) |
South West |
Winner |
Wokingham |
31.5% |
5.82 |
£ 27,792 |
45.2% (2) |
72% (1) |
South East |
Winner |
Brighton and Hove |
29.1% |
20.98 |
£ 22,437 |
38.3% (3) |
65% (2) |
South East |
Winner |
Solihull |
26.5% |
17.76 |
£ 24,146 |
37.2% (4) |
65.2% (2) |
West Midlands |
Winner |
Bath and North East Somerset |
25.8% |
12.05 |
£ 23,107 |
38.3% (3) |
63.6% (3) |
South West |
Winner |
Welwyn Hatfield |
24.3% |
14.00 |
£ 21,698 |
51.1% (1) |
66.7% (2) |
East of England |
Winner |
Ribble Valley |
23.4% |
10.30 |
£ 24,966 |
25.2% (8) |
69.0% (2) |
North West |
Source: Radius Data Exchange & EG Analysis of: Valuation Office Agency Hereditament data by postcode, NOMIS Labour Market Surveys, ONS Deprivation Index 2019, ONS Disposable Income per head 2018, ONS Gross Value Added (Local Authority) 2018
'Losers' in respect of retail performance as a result of working patterns shift
Winner /
|
Local Authority |
Indicative
|
Deprivation
|
Resident
|
Share
|
Share of
|
Region |
Loser |
Slough |
1.4% |
23.016 |
£ 18,831 |
44.3% (2) |
50.4% (8) |
South East |
Loser |
Thanet |
1.5% |
30.315 |
£ 18,074 |
17.2% (10) |
47.2% (9) |
South East |
Loser |
Barking and Dagenham |
1.6% |
32.883 |
£ 17,299 |
22.8% (9) |
43.0% (10) |
London |
Loser |
East Devon |
1.9% |
12.707 |
£ 21,134 |
21.1% (9) |
49.0% (8) |
South West |
Loser |
Gravesham |
2.0% |
20.742 |
£ 20,402 |
6.40% (10) |
50.3% (8) |
South East |
Loser |
Luton |
2.2% |
25.035 |
£ 16,257 |
35.2% (5) |
45.9% (9) |
East of England |
Loser |
East Lindsey |
2.3% |
29.66 |
£ 16,792 |
17.2% (10) |
50.5% (8) |
East Midlands |
Loser |
Allerdale |
3.0% |
22.669 |
£ 19,804 |
22.3% (9) |
44.0% (10) |
North West |
Loser |
Thurrock |
3.1% |
20.633 |
£ 18,976 |
26.8% (8) |
50.7% (8) |
East of England |
Loser |
Forest of Dean |
3.1% |
18.19 |
£ 18,734 |
29.7% (7) |
46.9% (9) |
South West |
Source: Radius Data Exchange & EG Analysis of: Valuation Office Agency Hereditament data by postcode, NOMIS Labour Market Surveys, ONS Deprivation Index 2019, ONS Disposable Income per head 2018, ONS Gross Value Added (Local Authority) 2018
Top 20 UK cities and towns by highest retail space per person, including number of change of use applications and percentage of premises with EPC rating of E or below
Population
|
City / town |
Sum of total retail
|
Resident
|
Retail
|
Number of
|
Percentage
|
084 |
Chester |
2,527,327 |
88,269 |
28.63 |
33 |
30.3% |
050 |
Gateshead |
3,302,195 |
119,491 |
27.64 |
21 |
26.4% |
075 |
Preston |
2,556,081 |
92,896 |
27.52 |
63 |
29.9% |
042 |
Blackpool |
3,802,575 |
144,132 |
26.38 |
18 |
32.5% |
099 |
Carlisle |
2,029,551 |
77,332 |
26.24 |
30 |
37.6% |
055 |
Salford |
2,828,894 |
111,973 |
25.26 |
57 |
23.1% |
053 |
Exeter |
2,912,899 |
115,494 |
25.22 |
43 |
28.6% |
097 |
Guildford |
1,914,774 |
78,152 |
24.50 |
15 |
23.3% |
046 |
Cambridge |
2,940,412 |
123,900 |
23.73 |
38 |
31.6% |
076 |
Southport |
2,194,477 |
92,676 |
23.68 |
36 |
34.3% |
024 |
Norwich |
4,451,243 |
190,576 |
23.36 |
52 |
31.7% |
069 |
Lincoln |
2,288,520 |
101,445 |
22.56 |
25 |
26.7% |
085 |
Grimsby |
1,920,673 |
86,903 |
22.10 |
20 |
29.6% |
091 |
Oldham |
1,780,188 |
81,248 |
21.91 |
30 |
30.3% |
072 |
Stockport |
2,089,331 |
95,640 |
21.85 |
43 |
34.1% |
051 |
Cheltenham |
2,400,380 |
117,057 |
20.51 |
37 |
33.5% |
100 |
Mansfield |
1,555,152 |
76,376 |
20.36 |
13 |
30.5% |
033 |
Peterborough |
3,252,987 |
163,166 |
19.94 |
49 |
27.3% |
027 |
Southend-on-Sea |
3,518,443 |
179,567 |
19.59 |
53 |
27.6% |
034 |
Oxford |
3,168,557 |
161,890 |
19.57 |
35 |
25.4% |
Source: Radius Data Exchange [including EG analysis of VOA data, Office for National Statistics and EPC]
For access to all of the data used in EG’s retail report and to read the report in full subscribe to EG’s news and data service at https://www.egi.co.uk/eg-data-news-analysis/
About EG
EG is a market-leading provider of data, news and analytics products and services to the commercial real estate market. EG products and services address the challenges and the data demands of all sectors and industries within UK commercial real estate. We deliver industry-leading events and weekly magazine content, and market leading data products including the EG Radius Data Exchange, the only contributory data sharing platform for the UK commercial property market.
