Britain’s shop vacancy decreased to 12.5% in January, representing the lowest level in six years, according to the Local Data Company (LDC).
In January, the number of vacant shops dropped by -171 and the number of shops increased by +81. These were the main drivers in the reduction in the vacancy rate. The peak in vacancy rates was 14.6% in 2012.
Analysis of vacancy rates by occupation type shows that Shop vacancy in January was 12.5% (-0.2%), Leisure vacancy was 8.15% (0.00%), and All (Retail & Leisure) vacancy rate was 11.4% ( 0.0%).
The town centre vacancy rate had a slight drop of -0.1% in January compared with the previous month. They were mixed results, with the vacancy rate dropping in seven regions/nations (East Midlands, London, North East, North West, South East, Wales and West Midlands), staying the same in three regions (Yorkshire and the Humber, South West and East of England) and increasing in one (Scotland). Compared with 12 months ago, town centres have seen a -0.4% drop in their vacancy rate.
The shopping centre vacancy rate dropped by -0.4% in January compared with the previous month. Wales (-1.0%) and Greater London (-0.8%) saw the biggest drops. The West Midlands was the only English region to see a fall in its vacancy rate of -0.4%. Compared to January 2015, Wales saw the highest increase in vacancy rate over the 12 month period.
Retail park vacancy rates improved across the majority of regions. The best peforming region was Yorkshire and the Humber, which saw a -0.9% drop in January compared with December.
‘Persistent vacancy’ calculates the number of units hat have been vacant for longer than three years and thus are unlikely to be reoccupied. The region with the highest percentage of persistently vacant units is the North East. The North of England, Scotland and Wales, all have persistent vacancy rates above the average of 4.5%. This shows there is a clear north/south divide.
LDC director Matthew Hopkinson, director at LDC commented:“These are encouraging numbers for the very reason that January has seen a net increase in the occupation of shops rather than the removal of empty shops from the overall stock. The national vacancy rate is also now at a level not seen since December 2009. What is also encouraging is that high vacancy towns such as Newport, Doncaster, Bradford and Blackburn have seen improvements. Conversely small centres near Liverpool including Old Swan, Everton, Gateacre and Hoole have seen vacancy rates increase.
“The fact that interest rates do not look like they will increase in 2016, oil prices are set to remain low for the very long term, and employment and incomes are rising (albeit slowly), means good news for retailers as consumers will continue to spend – be it online, in-store or both.
“The ability for retailers to do this profitably is the one big question, as costs and competition increase. Casualties of this have been seen in the recent administration of Brantano and the significant store closures of Blue Inc.
“The area of concern is that the number of units that have been vacant for more than three years has increased by 26% in the last year to over 12,000 – which equates to six Manchesters lying empty! Nearly 5% of Britain’s town and city centre shops have remained empty for more than three years.
“So whilst we have seen some positive signs at the start of 2016 for the high street, we cannot shy away from the vast numbers of empty shops that are never likely to be reoccupied again. ”
LDC visits over 2,700 towns and cities, retail parks and shopping centres. Vacant units are those units which did not possess a trading business at that location on the day visited. The shop vacancy index is based on the shop vacancy rates at the top 650 town centres.