Fresh from advising the UK government on cost cutting, retail supremo Sir Philip Green is taking a dose of his own medicine, announcing plans to ditch 300 regional stores leased by his Arcadia brands when leases come to an end in the next three years.
The downsizing trend is sending shivers down the spines of landlords with property in secondary shopping locations. "This is becoming a common theme," noted Guy Grainger, head of retail at property consultancy Jones Lang LaSalle. "The press has picked this up because it's Philip Green, but it could apply to any other retailer." Game Group and HMV are two listed players with similar strategies.
However, prime shopping centres continue to buck the trend. Shopping centre developer Hammerson revealed this week that retail sales at its UK centres have grown by 5.3 per cent since July. The company has signed 50 new leases at above-market rents, taking occupancy to 96.6 per cent. Having raised equity from selling mature French assets, expanding the UK portfolio is next. As well as extensions to Brent Cross in London and Glasgow's Silverburn mall, it is seeking to add a restaurant quarter to the Birmingham Bullring and will submit a planning application for the 1m sq ft regeneration of the Eastgate Quarters in Leeds by the end of 2010.
