The modern shopping habits that can be seen in the weekend queues of cars at out-of-town locations in the South West such as Cribbs Causeway in Bristol, West Cornwall Shopping Park and Devon’s Atlantic Village are attracting investors to buy into retail parks.
The retail warehouse sector recorded the highest overall volume of sales in the retail investment market last year, according to research by real estate specialist Colliers International.
Nick Turk, director covering out-of-town retail parks in the South West for Colliers International, said the research – detailed in a report called ‘Park Life – The State of Play in Out of Town Retail’ – showed how interest from investors reflected their popularity with both shoppers and retailers.
Turk said: “Retail parks are attracting shoppers at a time when many high streets and in-town shopping centres are experiencing declining footfall because they offer good accessibility, free parking and convenient Click and Collect points for picking up internet purchases.
“Vacancy rates on retail parks are at the lowest in nearly 20 years, with most empty units being filled quickly. The level of vacancy on retail parks is lower than other retail assets despite the rationalisation and administration of several high profile retailers over recent years.
“In addition, the out-of-town offer has evolved from white goods and electronics to leisure, fashion and new DIY concepts. Half of all retail parks now contain leisure and Food and Beverage, and the ongoing roll out of the Bunnings portfolio is set to bring a fresh, new approach to conventional bricks and mortar DIY stores. The number of discount grocery stores anchoring out-of-town schemes has also increased by 78 per cent in the last six years.”
Turk added that retail parks were attracting both overseas and UK investors because they offered attractive yields and returns, and were also regarded as a safe asset into which to invest capital in politically and economically uncertain times.
The sector is set to record the highest overall volume of sales in the retail investment market in 2017. As of November 2017, investment values for the year to date are in excess of £2.2 billion, on top of many significant deals which have not been publicly marketed.