New report shows Scotland out of town retail vacancy rate lowest since 2006

The level of empty out of town retail property in Scotland has hit its lowest point since the end of 2006, down to 7.8% at the end of 2014, according to The Definitive Guide to Retail & Leisure Parks 2015 launched by Trevor Wood Associates.

The figure is down from a mid-2009 peak of 15.7%, which was also the highest recorded in the UK since 2006.

The figures were revealed at an event hosted by Eric Young & Co in Edinburgh.

UK results showed that overall vacancy rates for the retail warehousing market were at their lowest since 2004, down to 7.1% at the end of 2014 from a peak of 10% in mid-2013.

A major factor in the turnaround has been demand from comparison goods retailers, which at the end of 2014, occupied 54.6% of retail warehouse space (excluding DIY), up from 53.2% the previous year.  Almost 2.5 million sq ft was taken during the year by just ten retailers:  B & M, Marks & Spencer, Home Bargains, The Range, TK Maxx, Poundland, Smyths Toys, Sports Direct, Dunelm and Pets at Home.

The report highlights the growth in floorspace of value retailer B & M as discount retailers increase their footprints across the UK. The trend follows the rise in discount and budget retailers identified in Going Shopping 2015 – The Definitive Guide to Shopping Centres, published by Trevor Wood Associates last year.

The out of town retail report shows that B & M has risen to sixth place in the Top 10 Retail Park Tenants rankings, up from 11th position in 2013.This follows a 30% increase in square footage – up from 2.28 million sq ft to 2.97 million sq ft in 2014.

Scotland featured highly in the league tables that make up the comprehensive report into the out of town retail market. As with the majority of the UK, B&Q is the top regional tenant in the country but B & M has now risen to fifth place here.

The top regional investment manager for both retail parks and retail warehousing in Scotland is British Land, which also tops the UK table for both categories.

The top letting agent for the retail warehousing market in Scotland was Eric Young & Co, which ranks 16thinthe UK and took the top spot in Scotland for the first time. The leading managing agent for retail warehousing is JLL, ranked second overall in the UK.

As for schemes, two of the top ten largest retail parks are in Scotland – Glasgow Fort Shopping Park is at number three and Edinburgh’s Fort Kinnaird took fifth place. Both rank equal tenth in the top 10 retail park rents league table. Scotland also has two of the top ten retail warehouse clusters in the UK with Edinburgh’s Newcraighall ranked second and Braehead ranking fifth.

The report included analysis of 131 schemes within Scotland. More than 1,550 UK schemes in total are analysed as well as 79 schemes “in the pipeline”.

Trevor Wood, senior partner of Trevor Wood Associates, said: “From the 2009 all-time high it is good news that vacancy rates in Scotland have fallen to less than half the mid 2009 figure and are now only slightly higher than the overall UK average. This has been due to new store openings by tenants such as B & M, Next and Smyths Toys which, with deals currently being finalised by these and other comparison goods retailers mean we expect the vacancy rate in Scotland to fall still further during the course of 2015.”

The Definitive Guide to Retail & Leisure Parks 2015, at 364 pages in length, is the biggest to date and includes two new major analyses. These include analysis of retailers who went into administration or restructured and analysis of the fastest growing and decreasing tenants.