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Britain's vacancy rates rise to 14.6%

Nearly 15% of Britain’s shops are lying vacant, with one in five units empty in the North West according to the latest report from the Local Data Company.

The nation’s retail sector has seen a marginal decline in the past year, with vacancies rising to a total of 14.6% at the mid-point of 2012, compared with 14.3% at the second half of 2011.   

Scotland saw the biggest overall increase in vacancies, from 15.4% last year to 16.7% now, but Wales remained the nation with the largest number of empty units, moving from 17.3% to 18.5%.

Outside of London and the south, the regions paint a similar picture with the North West (20.1%), North East (19.1%) and West Midlands (18.9%) recording the biggest number of vacancies.

Only London bucked the trend, with vacancies actually dropping from 10.7% to 10.1%.

The worst large centre is Nottingham, with a vacancy rate of more than 30%, followed closely by Walsall (29.6%).

Dudley is the worst mid-sized town (200-399 shops), recording 32.4% of shops empty, while Margate remains the worst small town (50-199), with a rate of 36.5%.

Shopping centres had equal vacancy rates to high streets in large towns and cities – 16.2% - making the two categories the worst hit across the sector.

Medium high streets had 15% of shops empty, while smaller high streets recorded 10% vacancies – an improvement on last year’s figure of 11.5%. Retail parks recorded the lowest rates, just 8.1%.

The report, entitled “Too Many Shops”, was based on data from 506 town centres and 145,000 shops visited between January and June 2012.

Several factors suggest that Britain’s “new reality is here to stay”, with the LDC noting that the most “prudent retailers are pulling their horns and consolidating into their most profitable space”.

The creation of new retail space, particularly in the North West, has combined with the downturn to dampen a rise in tenancy rates.

Continued economic woes, anticipated public spending cuts and a drop in disposable income will all conspire against consumer spend, with LDC claiming growth is unlikely to pick up for another decade.

“For the high street and especially for secondary shopping centres, it is clear that the current high levels of vacancy are likely to remain and this eventually brings forward the prospect of alternative uses being made of the space,” the report said.

“No doubt intervention in the form of regeneration schemes and Portas pilots will help at the margins, but the real problem for retailing in the UK is, and will remain for some time, the economy.”

Liz Peace, chief executive of the British Property Federation, said: “Our towns face complex structural problems that are not going to be solved by tinkering around the edges.

“In many places, we need to have a complete re-think about how vacant property could be redeveloped into new uses. That will require flexibility on the part of local planning authorities, but equally an acceptance from the property industry and its investors and lenders that in many cases previous values simply cannot be maintained and new lower value uses are the only option.”

Matthew Hopkinson, director at the Local Data Company, said: “At worse it is about managing decline to enable alternative uses for a centre to take over and at best it is maintaining positive trends in the face of increasingly fierce competition and costs.

“Every town has the opportunity to attract consumers and spend. However, aspirations must be tempered with reality and reflect the needs and spend of each town’s consumer.”

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