With the relentless rise of online, is this the end of retail as we know it?
little effect on prime retail investment values here, which is really a ref lection of the weight of money chasing commercial real estate. Prime High Street yields have hardened in to 3.5pc and are 4-5pc for prime shopping centres like Dundrum and Blanchardstown. That said, I think that run is over, nor do I see much rental growth. On Grafton Street, a decent shop has been available for nine months and generally, questions are being asked as to who exactly are the retailers that are going to pay these top rents? The common answer now is the food and beverage sector, which is thriving, but that is being overplayed.
Long-term, I suspect that the market will overcorrect before eventually finding a balance between online and High Street. The Amazon/ Whole Foods deal is itself proof that the future is a blend of both. In a fast- changing market, developers and investors have to be certain that their tenant has the right offer and business model. A long lease to a fading dinosaur is worth less than a shorter one to a dynamic tenant driving footfall.
Planning policy, redevelopment and customer experience will play a part too. And the one thing that a market in chaos always presents is... opportunity.