Retail rents hold up in tough times

AS we reach the half way point of summer, we at Colliers International embark on our annual regional roadshow to present the findings of our latest Midsummer Retail Report to clients across the UK.

In a year where business rate increases, minimum wage, Brexit uncertainty and the general economic environment have helped to create a perfect storm which has wrecked a growing number of retail businesses over the last 12 months, Midlands retail locations have fared relatively well.

In this difficult market, a marginal increase in average prime rents of 0.4% across the West Midlands means the region has seen its third consecutive year of growth.

Birmingham still has the highest average Midlands prime rent per sq ft at £295. While we did not see an increase in the city’s rents year-on-year, several landmark office developments will bring a new influx of shoppers and it will be interesting to see what effect these have later in the year and into 2019.

HSBC is moving into Arena Central this summer while PwC has taken 150,000 sq ft in the Paradise development and will take occupation early next year. These lettings will bring roughly 4,000 permanent employees plus customers and other visitors, which will have a positive impact on shops, restaurants and other amenities in the city centre.

Looking ahead, highlights for Birmingham will include the opening of the world’s biggest Primark, which is due to open in December. Whilst H&M has opened its new flagship store in the former BHS on New Street.

We predict the stabilisation of rents in Birmingham will continue over the next 12 months.

New development has created better environments for those working, visiting and living in the city and are driving footfall and spend which can only be a good thing for the region. Emel Ahmet, Associate Director, Retail Agency, Colliers International Sponsored Column