Shop vacancy rates soar as coronavirus lockdowns hit hard

There are around 5,000 fewer physical UK stores since the start of the coronavirus pandemic, meaning one in seven shops now lie empty, according to the British Retail Consortium and Local Data Company.

In the first quarter of 2021, the overall GB vacancy rate increased to 14.1%, from 13.7% in Q4 2020. It was 1.9 percentage points higher than in the same point in 2020.

All locations saw a rise in vacancies in Q4, with shopping centres faring worst of all, increasing to 18.4% from Q4 2020’s 17.1%.

On the high street, vacancies were up to 14.1% in Q1 – remaining in line with the overall rate. This was up from 13.7% in Q4 2020.

Retail parks, meanwhile, rose slightly to 10.6% in Q1 2021, up from 10% in Q4 2020. However, it remains the location with by far the lowest rate.

Helen Dickinson, Chief Executive at the British Retail Consortium, says: “After a third national lockdown, it is no surprise that the vacancy rate has continued to soar.”

“The forced closure of thousands of shops during the first quarter of 2021 has exacerbated already difficult conditions for the retail industry.”

She adds: “With full business rates relief and the moratorium on aggressive debt enforcement ending in England this summer, many stores may never reopen.”

“The government must ensure the ongoing business rates review leads to reform of the broken system and permanently reduces the cost burden which is leading to unnecessary stores closures and job losses.”

“The devolved nations have already agreed to extend the business rates holiday until 2022 and England should consider following suit.”

Lucy Stainton, Director at Local Data Company, comments: “The early indications from the first few weeks of the “unlocking” have shown there is still significant demand for physical retail and eating out.”

“Hopefully, as consumer confidence continues to build momentum with reduced Covid-19 cases, more of the population vaccinated and warmer weather, further fall out from the pandemic might be mitigated somewhat.”

“Similarly we are seeing a lot of redevelopment with retail stores being converted to other uses such as office space and residential property - this too may help stabilise the increase in vacancy we'd otherwise expect to see continue into Q2."