Store vacancies fall as retail boosted by tourism and office working

The overall rate of store vacancies across Great Britain improved to 13.8% in the fourth quarter of 2022. This is 0.1% better than Q3 and 0.6% better than the same time last year.

In shopping centres, vacancies improved to 18.2% in the fourth quarter compared with 18.8% in the third, high street vacancies improved slightly to 13.8% in the final quarter compared with 13.9% in the third quarter, and retail parks continued to show the lowest vacancy rate at 9% in Q4 – a 0.7% reduction from Q3 2022. 

Greater London, the South East and the East of England reported the lowest vacancy rates in the country whereas the highest rates were in the North East, followed by Wales and the West Midlands.

British Retail Consortium chief executive Helen Dickinson said: “While the number of empty stores reduced in the final quarter of 2022, vacancy rates have not recovered to pre-pandemic levels. Retail occupancy was boosted by the return of international tourists visiting UK towns and cities, and more frequent visits to offices.

“These trends have given many retailers the confidence to invest in repurposing and reopening empty units. The North East, in particular, has benefited from this investment boost, with the region seeing the biggest increase in store openings. However, it still lags behind other parts of the UK, with the highest vacancy rate in the country.

“The first half of 2023 will likely be yet another challenging time for retailers and their customers. There are few signs that retailers’ input costs will ease, putting further pressure on margins and making businesses think twice on how much investment to make.

“However, the situation should improve in the second half of the year as inflationary pressures begin to ease and consumer confidence is expected to return.”

Lucy Stainton, commercial director at Local Data Company, said: “With vacancy rates being such a good barometer of the overall health of the physical retail and leisure landscape, it’s really positive to see the number of empty units at a Great Britain level continuing to fall since they peaked mid-pandemic.

“Retail parks continue to outperform other location types, which is perhaps an indication that some of those shopping habits formed during the height of Covid are sticking – with consumers favouring these drive-to locations and larger-format units.”

“The Christmas trading period seemed to indicate that consumers were favouring and returning to stores, alongside their online spend.

“With retail spaces sitting at the centre of our communities, hopefully this will support a continued, even if measured, decrease in empty units.”

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