Scotland’s out of town retail parks have weathered a stormy year of administrations and company voluntary arrangements thanks to the arrival of new retail faces.
According to Savills research, 82 empty retail units were let out last year, 8% up on the long-term average, after big brands including Carpetright, New Look and Homebase opted for a CVA, while Maplin, Toys R Us and Fabb Sofas ended up going into administration.
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Key retailers driving renewed activity include the two German supermarket chains, Aldi, Lidl, and The Range, Home Bargains, Iceland/Food Warehouse and B&M as well as a number of bulky goods retailers. Scotland has also seen a number of new entrants in the market, with Homestore & More securing its first UK stores at Craigleith Retail Park in Edinburgh and Mavor Avenue, East Kilbride in 2018.
As the retail sector continued to struggle against changing consumer habits and rising costs, 2018 was dubbed ‘the year of the CVA’, says the international real estate advisor.
Mike Spens, director in the out of town retail team at Savills in Scotland, said: “Corporate failures in the retail sector in the last 12-18 months have released space onto the out of town retail market and allowed for greater churn. This has created an opportunity for brands such as Home Bargains and B&M and the discount food retailers to expand across Scotland and for new entrants to secure representation.’’
Active retailers are exploring options to sub-divide existing units to make them fit for purpose and landlords have to be receptive of these wishes to ensure retail parks have longevity in the marketplace. Retailers are adapting with the changes and harnessing new ways to shop.
“Retail parks in particular are host to a number of retailers that offer products that customers want to inspect before buying – furniture, carpets, kitchens, bedrooms – and this is one reason why we believe, despite the ongoing negative headlines, retail parks continue to serve a much needed purpose in an affordable context.
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“Equally, the discounters who have been successfully expanding do not offer the ability to buy online and therefore the focus for them remains on physical stores.”
Sam Arrowsmith, associate director in Savills research team, adds: “The events of 2018 show signs of a retail revolution rather than a recession. With the endless negative press coverage around CVAs you would be forgiven for thinking the out of town retail market was in distress. In reality only roughly 3% of units in the UK out of town market were affected by either a CVA or administration in 2018.''
