20th May 2021
Despite the weather’s best efforts to dampen proceedings it was a welcome sight to see the famous King’s Road abuzz with activity as our leisure and restaurant clients joined our retailers in re-opening, on what we hope is the start of the return to ‘normal’ and the end of restrictions.
Early data suggests that footfall on the King’s Road for the week of 12th April, when retail re-opened, was only 6% lower than the same week in 2019 pre pandemic. These findings reflect the thoughts of Andrew Goodwin, chief UK economist at Oxford Economics, who recently commented in the Financial Times: “Most forecasters are too pessimistic about the outlook and the strength of the recent data suggests our forecast that GDP will grow by 7.2 per cent in 2021 is well on track.”
Alongside positive attitudes, much has been done behind the scenes by landlords, restauranteurs and retailers to ensure that the ‘great re-opening’ was both safe and successful. Working with our partners in the King’s Road Partnership and The Royal Borough of Kensington & Chelsea, a number of initiatives have been introduced to the street and communal areas to make the shopping experience attractive to consumers. This includes 500 additional Alfresco dining seats, life size wooden elephants, pop up food & drink stalls and 30 local artist designed flags which majestically fly over the King’s Road. All serve as a great reminder of the importance of our high street at the centre of our community.
The pandemic has shown the elements of a successful high street, and sadly highlighted the characteristics of a bad one, as well as accelerating the demise of businesses that were already struggling pre-March 2020. The King’s Road has fared better than many high streets, and certainly most of its London counterparts, due to its affluent and loyal resident neighbourhood who have enjoyed click & collect and some of the finest food deliveries in the capital. At Martin’s Properties we look to adopt the positives from re-opening and the measures that have been put in place to create thriving, busy high streets. Our outlook for the retail sector in the medium to long term is a positive one as we develop new models to work with our customers and offer best in class retail and town centre experiences.
There are many opportunities for landlords and their business customers as brands begin to acknowledge the importance of physical stores and shop frontage as an integral part of their marketing mix and the halo effect that a physical store has on online sales. The challenge for retailers is to create a point of difference in these spaces and an experience led offering that cannot be found online and one which boosts the retail experience of its customers, alongside their use as locations for ‘click & collect’.
The government’s reforms to planning use classes and the new Class E also marks an opportunity for landlords and retailers. Occupiers are now presented with a greater choice of space, whilst landlords are now able to market spaces to more sectors and therefore create flexible spaces that enhance the environment and experience. One challenge that the changes to Class E presents is to ensure a vibrant mix of uses in these premises throughout the morning, day and night and not to allow the changes to generate a single use, highest value high street.
The retail sector has responded incredibly positively and the return to ‘local’ has seen an increase in demand from new retailers and F&B operators looking to capitalise on this.
Whilst we remain cautiously optimistic in our predictions for the sector, we predict there will be some further difficulties this year as the government support measures fall away, putting pressure on retailers that are unable to generate the turnover to support their businesses. We also expect another year of apathy from the investment market as larger funds continue to adjust their weightings. However, we expect the best high streets and best retailing destinations to prosper and prices to stabilise and harden.
The pandemic has cemented our view, as landlords, that it is our responsibility to assess the social and environmental impact of our portfolio and ensure we leave behind a more co-ordinated High Street with active frontage and an environment that will benefit the future.
Image credit: @sloanestreetsw1 & @kingsroad.london