Malls bounce back in January as UK footfall decline slows down
The week has started with some good news for the under-pressure malls sector with the latest UK footfall report from specialist tracking firm Springboard being headlined The start on the road to recovery for shopping centres.
The company said January “brought some stability for bricks and mortar stores," with a drop in footfall of just 0.5% year-on-year this time after it had fallen 0.7% in January 2019.
This was also reinforced by an improvement in shop vacancies, with the rate of 9.8% being the lowest for a year, and below January 2019’s 9.9%.
Admittedly, these were small wins and footfall overall still declined, but in a retail sector that rarely seems to get any good news at the moment, January was a reasonably bright spot.
As we said, shopping centres were stronger than they have been. Footfall in shopping centres rose by 0.2% for the year, the first month with an increase since as long ago as March 2017, and only the third month in four years when footfall has risen. Those stats really underline just how tough it has been for shopping centres.
But shopping centres weren’t the biggest winners last month. It was no surprise that retail parks came out on top with a 1.4% increase. These destinations have consistently been the top performers for the last few years. Springboard said their increase last month demonstrated “their ability to bridge the gap between functionality and experience, and cater for the needs of today’s efficient shopper”.
And high streets? Well, they continued to suffer with a 1.8% drop, Springboard saying that the gain in shopping centres came at the expense of high street visits.
It added that this shows how focused investment by shopping mall owners can deliver footfall-boosting enhancements in a way that the split ownership of high streets can’t replicate.
“The gestation period for shopping centre investment can be a long one, but once the chess pieces are finally in place a single owner is often more readily able deliver meaningful change than a high street, which can be weighed down by a multiplicity of owners,” Marketing and Insights Director Diane Wehrle said.
This has been made clear by the heavy investment in malls on the part of owners such as Unibail-Rodamco-Westfield, Intu, Hammerson and Landsec. And it’s not just about headline-grabbing building investments costing hundreds of millions either. Intu, for instance, has been pro-active in attracting experiences providers to its malls, both on a permanent and pop-up basis.
The experiences element was clear from Springboard’s figures that showed shopping centres rose 3% post-8pm, while high streets fell 1.3% into the late evening period.
Diane Wehrle added that the month’s result “reinforces the benefit of a single ownership structure and also demonstrates the realisation that the old format of 100% retail is no longer relevant. The path of enhancement of shopping centres has only just begun, but the shift in the proposition of some malls alongside the reduction in supply, taking out malls that are simply not fit for future purpose, will bode well for those that remain. The issue moving forward will be the cumulative impact of this, together with the functionality of retail parks, on high streets.”
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