Threats to the high street as we know it are nothing new, from the out-of-town retail park boom of the 1990s to the latest trends in online shopping, the high street has had to adapt during periods of change.
Whilst the latest trend in online shopping continues to have an unprecedented impact on the high street, landlords are currently identifying and considering ways in which to repurpose their offerings to ensure the longevity of the high street through the most challenging and uncertain of times. The traditional retail-only model of the high street may be in decline, but the alternatives have the potential to breathe new life into the high street, so long as investors look at the bigger picture and ensure that changes to the high street are sensitively undertaken.
What should investors be considering when faced with vacancies in their portfolio?
At particular risk are the large, single occupancy department stores inhabited by retailers such as BHS, House of Fraser and Debenhams. The collapse of such retailers has been the result of a perfect storm of high overheads, uncertain trading conditions and the rise of online shopping, and a failure to identify and adapt to changing consumer habits.
Historically, the failure of these retailers to adapt and respond to the challenges posed by the increasing popularity of online shopping has led to landlords having to deal with loss of their anchor tenants, with no clear alternative tenants who would be willing to take on such a large space.
However, it isn’t necessarily all doom and gloom. John Lewis continues to grow and develop its offering to respond to the challenges and recently won awards for its White City store, which as well as the traditional offerings you would expect from John Lewis also provided a range of experiences such as a home design service, a beauty bar and other experiences to tempt people to visit and spend the day there. Identifying such trends and capitalising on offerings, which entice people into stores by providing “experiences” that cannot be obtained online, is crucial in introducing variety to the high street whilst still maintaining a retail presence.