"Since the end of 2022, with even less development taking place, second-hand supply has meant the vacancy rate of Open A1 non-food units has dropped to 6.3.% from 7.3%. A further 2.9 million sq. ft. of space is currently under offer with another 684,000 sq. ft. earmarked for non-retail redevelopment, meaning the percentage of space actually available to let is as low as 3.6%."
Retail warehousing vacancy rates in the UK have once again fallen, now at 5.4% at the end of Q2 2023 according to the latest research by Trevor Wood Associates (TWA), compared to 6.1% at the turn of the year and 5.8% at Q1 2023.
The major contributor to the significant fall in vacancy is retailers continuing to take advantage of the amount of second-hand supply made available by various administrations and CVA’s, so far in 2023 over 0.75 million sq. ft. of vacant space has been taken and 4.49 million sq. ft. in total has opened or is due to open this year.
The Grocery sector continues to thrive on established parks or retail warehouse sites with Aldi adding 237,000 sq. ft. this year, Lidl opening over 170,000 sq. ft. out of town while Iceland and the food WAREHOUSE and Farmfoods added over 65,000 sq. ft. of space to their portfolio’s. The usual suspects also continue to lead the way in taking vacant space, B & M have opened or have committed to open another 16 units, The Range has added another 118,000 sq. ft. to their portfolio, Home Bargains added another 19 units while Poundland opened (or will open) another 215,000 sq. ft. since the end of last year.
The face of retail parks and the out of town market as a whole continues to adapt to retailers needs, we are still seeing experiential retail and leisure on the rise with the likes of Tenpin due to open at both Chester Retail Park and Kingsway West Retail Park in Dundee later this year, the latter taking the 36,000 sq. ft. former Toys ‘R’ Us. Pure Gym have added over 273,000 sq. ft. of floorspace in 2023 and were crowned the second fastest rising retailer out of town in our publication The Definitive Guide to Retail & Leisure Parks earlier this year, while further store openings by The Gym, Snap fitness and JD Gyms as well has others as meant the gym operators have taken 374,000 sq. ft. in total already this year.
The size of units and retailer requirements are also changing with over 456,000 sq. ft. of lettings in 2023 taken by retailers in units of 5,000 sq. ft. or below. We continue to see the rise of drive-thrus and drive-tos with Costa Coffee, Greggs, McDonald’s and Starbucks increasing their presence in the booming drive-thru market.
