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Soaring Closures Raise Fears Of Ghost Town Shopping Centres Across Uk

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http://business.timesonline.co.uk/tol/busi...icle5576709.ece

A sharp rise in the number of stores being shut by distressed retail groups is fuelling fears that chunks of Britain’s high streets and shopping centres will be left as ghost towns by the deepening recession, which was officially confirmed yesterday.

Concern mounted that a rising tide of premises being closed will bring desolation to large tracts of shopping centres after new figures underlined the extent of the trend.

PricewaterhouseCoopers, the accounting group, said that Britain was at risk of developing a phenomenon of “grey malls”, mirroring the retail wastelands of closed premises springing up across the United States.

“In recent years we’ve had coffee shops, mobile phone shops and charity shops filling the voids. Apart from pound shops, what’s the next thing that’s going to fill them?” Barry Gilbertson, a corporate restructuring expert at the accounting group, asked.

“Keeping tenants trading is more important than getting in a dribble of cash, particularly in a shopping centre.” Among retailers forced into administration, the proportion of stores that has already been shut has climbed to 43 per cent, according to research by PwC. If only 10 per cent of national retailers slide into financial difficulty as the recession bites deeper this year, that could mean the closure of 4,400 stores.

If big retail chains were forced to close two in five of their premises, as has happened with the businesses already in administration, the total would climb towards 9,000.

The surging number of premises being boarded up for the long term, seen most dramatically with the closure of 500 Woolworths stores, comes against a worrying backdrop of strife between retailers and their landlords.

As the recession undercuts consumer demand and the plight of retailers deepens, a growing number of stores groups are resorting to renegotiating rental payments and seeking to pay monthly rather than quarterly.

The financial toll on the economy from closed shops is hard to quantify precisely but PwC projects that if 20 per cent of store premises are left empty that could cost landlords up to £1.4 billion.

But the clever landlords aren't cutting rents are they to keep people in the shops, they'd much rather board them up.

Where I live over the past year I've seen more and more shops close and left empty, in our little shopping area I think there's about 25-30% of shops empty, some of them have been empty more than 18mths with no takers. In the current climate I can't see this improving and will probably get worse.

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just beforethe last recession was gaining traction, high streets were full of banks, bank owned estate agents and car phone shops.

Seems not much has changed.

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http://business.timesonline.co.uk/tol/busi...icle5576709.ece

But the clever landlords aren't cutting rents are they to keep people in the shops, they'd much rather board them up.

Where I live over the past year I've seen more and more shops close and left empty, in our little shopping area I think there's about 25-30% of shops empty, some of them have been empty more than 18mths with no takers. In the current climate I can't see this improving and will probably get worse.

it's vacant offices that crack me up, I'm looking at a project that involves creating twenty five outlets over the next 2 years, in order for it to work (for me) we have to be paying circa ten quid per sq foot on 3,000 sq foot office, I want the profit, I'm not giving it to the landlord. The amount of office space available is mind blowing yet so many landlords arrogantly believe they can sit out this downturn, as though it'll blow over by April....w@nkers... <_<

Edited by Converted Lurker

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They should have made the landlords pay the rates on empty properties - that would reduce rates and encourage them to have the property used.

Empty units does no one any good.

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They should have made the landlords pay the rates on empty properties - that would reduce rates and encourage them to have the property used.

Empty units does no one any good.

over the past decade commercial landlords have operated in a similar vein to the BTL monster, if their units are empty they're still winning. The crash in commercial values in 2008 was twice that of resi and the occupancy rate is abysmal. IMHO there's a lot of them in denial, they've been stunned by the quick tournaround and havn't adapted quickly enough. The amount of empty office space is truly mind boggling.

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I'm looking at a project that involves creating twenty five outlets over the next 2 years

The next time some fool tells me that high land prices don't directly result in unemployment may I have your permission to beat the living daylights out of them?

Thanks.

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“Keeping tenants trading is more important than getting in a dribble of cash, particularly in a shopping centre.

Haha, dribble of cash. the basements of the retail sector is flooded with the demands from rent/rates and is a large part of the reason they cannot survive or cannot compete with the supermarket sector / online discounters. Retail sales did not drop at all last year, they were up, the rot is coming from the bottom up not the top down. Nobody noticed the rot was setting in whilst looking up at the sky.

Edited by OnlyMe

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As of last April landlords of commercial property are now responsible for the business rates even when the property is empty - so very hard for landlords to leave property vacant now.

u-turned

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it's vacant offices that crack me up, I'm looking at a project that involves creating twenty five outlets over the next 2 years, in order for it to work (for me) we have to be paying circa ten quid per sq foot on 3,000 sq foot office, I want the profit, I'm not giving it to the landlord. The amount of office space available is mind blowing yet so many landlords arrogantly believe they can sit out this downturn, as though it'll blow over by April....w@nkers... <_<

This isn't going to blow over anytime soon. Most start-up companies can be operated either entirely or partly from home these days. These landlords will suffer the same problems as their retail counterparts.

With regard to the high street once we approach say 10 to 15 % of empty shops (we are probably close to this already) it will start to have a negative effect upon the shopping experience (especially for women who like to browse around the shops). In general, for men who can shop on their own, they tend to shop in an item-specific targeted manner, following a hunter-gatherer approach - for instance I can only enter about 3 shops before I need a pint! Most men also do their homework comparing prices online before they go. They enter the shop armed with information they need and will only purchase the item if it meets their expectations. Of course many just browse and then return home and buy what they were after online too.

It amazes me that landlords and these shop owners have not been able to see what is coming.

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http://business.timesonline.co.uk/tol/busi...icle5576709.ece

But the clever landlords aren't cutting rents are they to keep people in the shops, they'd much rather board them up.

Where I live over the past year I've seen more and more shops close and left empty, in our little shopping area I think there's about 25-30% of shops empty, some of them have been empty more than 18mths with no takers. In the current climate I can't see this improving and will probably get worse.

in general a lot of them cant afford to cut rents due to their loan commitments (just wait until they have no income at all)

also traditionally commercial landlords have held out from lowering rents as this then reduces the capital value for resale (or remortgage) and also this reduces the value for nearby properties re comparative values again for remortgage purposes or when tennants are negotiating a new lease

interesting times - especially with the idiots in charge

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it's vacant offices that crack me up, I'm looking at a project that involves creating twenty five outlets over the next 2 years, in order for it to work (for me) we have to be paying circa ten quid per sq foot on 3,000 sq foot office, I want the profit, I'm not giving it to the landlord. The amount of office space available is mind blowing yet so many landlords arrogantly believe they can sit out this downturn, as though it'll blow over by April....w@nkers... <_<

I'm looking for a similar space for my start up: ' Dun' a Runner Plc ' the debtor informant recruitment agency. ;)

Perhaps you can remind the landlords of the past, where many ind. estates were virtually empty of tenants. In 1995 at the end of the last bust, I got some blinding deals on some south London warehouses at £1 and £2 a sq foot. (10,000 & 6,000 sq ft).

Coverted part of one warehouse and lived in it on the sly for 5 years. I had no choice as I was on a very low income, having started a business. No rent or council tax, so it helped the business survive for another year or two.

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There's this trend here now where artists are putting exhibitions into empty shops for free/no rent. Some of this art is sub-Banksy twaddle but even so vastly more interesting than a bland chainstore seling pointless sweatshop-made plastic tat.

It's a good thing that our town centres may return to being true civic spaces and not just shopping meccas. With the recession AND the move to online shopping the closure of shops has an upside.

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only problem with this is that they if someone introduces it they will probably keep all the other taxes also

if they scrap taxing people on their labour then fine

Without it, we will repeat the whole thing within 25 years.

100% guaranteed.

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Interestingly, Aberdeen is building a brand new Ghost Mall near the harbour; a huge new shopping and cinema complex that will swallow up the railway station and surrounding area and has so far had expressions of interest from a grand total of three retailers.

This was actually touted as a tourist attraction by the council. Uh-huh.

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The next time some fool tells me that high land prices don't directly result in unemployment may I have your permission to beat the living daylights out of them?

Thanks.

Granted my friend, have to confess I'm quite charged atm re. various opportunities, less noise/competition/copies in slumps for good business ideas. However, if I can't get space at max 12 quid psf then my plan doesn't fly, wtf should my business centre around making a landlord's income stream easier? Makes my blood boil that they'll leave offices vacant for a year at twenty quid psf rather than rent it out at ten... :wacko: I'm feeling some of them relenting now, if not I'll even consider entering into a jv with one or two I know...

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Granted my friend, have to confess I'm quite charged atm re. various opportunities, less noise/competition/copies in slumps for good business ideas. However, if I can't get space at max 12 quid psf then my plan doesn't fly, wtf should my business centre around making a landlord's income stream easier? Makes my blood boil that they'll leave offices vacant for a year at twenty quid psf rather than rent it out at ten... :wacko: I'm feeling some of them relenting now, if not I'll even consider entering into a jv with one or two I know...

well, cheap loans and appreciation allowed this farce to continue. at the then of the year, the balance sheet was UP with capital appreciation. More loans to cover the cash flow? of course, mr Banker agreed, as porperty only goes up.

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This isn't going to blow over anytime soon. Most start-up companies can be operated either entirely or partly from home these days. These landlords will suffer the same problems as their retail counterparts.

With regard to the high street once we approach say 10 to 15 % of empty shops (we are probably close to this already) it will start to have a negative effect upon the shopping experience (especially for women who like to browse around the shops). In general, for men who can shop on their own, they tend to shop in an item-specific targeted manner, following a hunter-gatherer approach - for instance I can only enter about 3 shops before I need a pint! Most men also do their homework comparing prices online before they go. They enter the shop armed with information they need and will only purchase the item if it meets their expectations. Of course many just browse and then return home and buy what they were after online too.

It amazes me that landlords and these shop owners have not been able to see what is coming.

Had dealings with a local big shot commercial landlord a couple of years back, his whole method was based on squeezing the life out of his commercial tenants and looking at what he charged I couldn't understand how many of them turned a profit, they're mostly salons, bars, local retailers, he's gonna have a lot of empty premises on his hands and IMHO he and his kind need to take some responsibilty for killing these businesses before they even got off the ground...

Edited by Converted Lurker

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Without it, we will repeat the whole thing within 25 years.

100% guaranteed.

not to the same extremes - if we have sound money and do away with the fraud that is fractional reserve banking

another thing against the land tax is the need for valuations and therefore the need for non-productive jobs (we are well past the limit on those already)

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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