Publication

UK Shopping Centre and High Street Spotlight – Q3 2017

17 October 2017

We believe that the definition of prime has become a little too narrow

Summary

■ The return of real earnings growth in 2018 will drive stronger household spending.

■ An improving consumer economy in 2018 will lead to a pick-up in retailer confidence. However, we expect that expansion plans will remain cautious and highly selective.

■ Real rental growth is unlikely to return to many markets in 2018, other than on the primest of pitches.

■ Investors in high street shops will generally be heavily biased towards 'prime' or 'secure'.

■ Shopping centre investors are targeting prime, dominant and community/convenience schemes.

■ A lack of demand for secondary assets could well lead to a buying opportunity in 2018, particularly as retailer and consumer confidence starts to improve.