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Bloodbath on the high street

Yet more bad news reported for retail.  As we have written about previously, the pandemic has served to accelerate trends that were already happening especially the drive to online shopping.  

What does this mean for retailers? They need to adapt and not just in terms of the experience they offer their customers but also in how they deal with their landlords.  The commercial property industry is going to need to take a far more collaborative approach to its dealings with its retail tenants.  Fixed rents payable at quarterly intervals are probably a thing of the past.  The modern retailers are expecting their landlords to share some of the risk, which means turnover rents and "covid clauses" (allowing for rent holidays should lockdowns be re-imposed).  

Unfortunately, it is unlikely that the pain on the high street is over and the industry is likely to have to brace itself for more closures.

A record number of shops disappeared from high streets across the country in the first half of 2020 as the Covid-19 lockdowns hammered the retail sector. A total of 11,120 chain store outlets closed between January and June, while 5,119 opened. The 6,001 net store closures was a record high and compared with 3,509 in the first half of last year.

Tags

real estate, retail, property