The growing litany of retailers in administration is leading to increasing vacancy rates in shopping centres across the country. The closure of 800 Woolworths stores nationwide in the first week of the new year was the most extreme example, but new research from Experian predicts that it will be by no means the last.

Experian expects a combination of store disposals, administrations and branch network rationalisations to push the UK vacancy rate up rapidly from 7 per cent at the end of December 2008 to 10 per cent by February 2009. This will leave a total of 90,000 vacant outlets. And by the end of 2009, Experian expects vacancy rates to have risen as far as 15 per cent. With a total of 135,000 empty outlets, the UK market will be facing its highest ever recorded retail vacancy rate.

Significantly, the pattern of vacancies is not expected to be uniform, and Experian believes smaller market towns are likely to be worst affected.

Jonathan de Mello, director of Experian’s retail consultancy, commented: “The unprecedented level of retail vacancy will be disproportionately spread across Britain, so that smaller retail destinations, in particular market towns, will be worse affected.

“The loss of major multiples such as Woolworths will leave a significant gap in these towns and is likely to have a knock on effect on other retailers,” he forecast.

“Many local authorities and centre managers will face a challenge this year, as they seek to reverse the effects of retail decline. The large scale retail business failure is also expected to have a significant impact on high street returns, affecting investors’ yields on rents as well as rates and other income sources collected by local authorities,” de Mello concluded.

The Experian research chimes with a downbeat forecast from agent King Sturge, which warned that vacancy rates could already be approaching 15 per cent in some of the hardest-hit shopping centres

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