Shopping centre development subdued – Cushman & Wakefield
Development activity for shopping centres in the UK is subdued, and is expected to remain so for the foreseeable future, says Cushman & Wakefield. In its latest research into the sector, C&W notes that shopping centre provision increased by only 46,500 sq m during the first half of the year, with the completion of Trinity Walk in Wakefield. The projected 2011 completion total is nearly 264,000 sq m, which is 12% more than in 2010 and similar to the 2009 total – but this figure has been hugely boosted by the 176,500 sq m Westfield Stratford City centre, which alone accounts for 67% of the forecast 2011 development total.
Two other new schemes are due to open in the second half of this year – Parkway in Newbury (27,400 sq m) and the 7,100 sq m retail part of the mixed-use Cube development in Birmingham. In 2012, completions are forecast to be much lower, with the current pipeline at just 18,500 sq m. The Tesco shopping centre in West Bromwich, which was originally intended to complete in 2012, has now been delayed to 2013, C&W notes.
Although retail sales are sluggish and several major retailers have gone into administration in recent months, C&W says some companies are expanding and there is evidence of strong demand for space in high-quality, regionally dominant centres. It notes that Stratford City reportedly opened 95% let and Trinity Leeds – where work has restarted – is leasing strongly. Other previously mothballed projects may be restarted, C&W adds.
Secondary centres, however, are still attracting little interest and the gap between prime and secondary shopping centres is likely to widen, C&W says. Completions are expected to pick up after next year, “although activity is unlikely to match the levels seen in 2005-2008,” the firm adds.
