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Moving to The Mall

Peter Hemple looks at the emerging trend of converting shopping centres into homes

Much of the retail sector is under pressure and occupier demand is expected to fall further, according to the Q2 2018 RICS UK Commercial Property Market survey. The quarterly survey results revealed that the downturn across the retail sector continues in
contrast with the industrial sector, which is attracting solid demand from occupiers and investors, thanks to the continued growth of online shopping.

Demand from occupiers in Q2 was the weakest since 2012, according to RICS, while office demand held broadly steady. RICS reported: “This pattern is also reflected in the availability of space with empty retail units becoming increasingly visible.”

The report added that secondary retail was most vulnerable to price falls, to accompany falling rental levels, but that prime retail rents are also falling now. Simon Rubinsohn, RICS chief economist says: “The challenges being faced by retail not surprisingly come through strongly in the latest set of results.”

UK high street sales fall for fifth month running
High street sales fell for the fifth month in a row in June, according to a survey that suggested bricks and mortar retailers have endured the worst first half year of trading in more than a decade. UK high street sales fell 1.7% year-on-year in June, the fifth consecutive month of falling sales, according to data released by advisory firm BDO, which bases its finding on a survey of mostly medium-sized retail businesses. It is the first time in at least 12 years that in-store growth had not topped 1% in a single month for the first half of a calendar year.

Sophie Michael, the head of retail and wholesale at BDO, said: “The bleak and crippling start to the year shows no sign of abating, with deep discounting set to eat into margins that are already being stretched paper-thin by poor sales and rising costs, including the much discussed issue of unfair business rates imposed on high street retailers.”

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