The agent calculates that there is now 43.7m sq ft of shopping centre floorspace either under construction, with permission or in the planning stages in the UK.

According to Colliers, 2.6m sq ft of new shopping centre floorspace was completed in 2009, down from 8m sq ft in 2008. And it expects almost 2.7m sq ft of shopping centre floorspace to be completed in 2010.

The largest scheme to open this year will be Hammerson’s newly acquired development, The Rock in Bury. It will provide over 500,000 sq ft of retail space, anchored by Marks & Spencer and Debenhams, and is due for completion in July. Another significant project is Capital Shopping Centres’ Eldon Square South extension in Newcastle upon Tyne. Once completed this spring, it will provide a further 410,000 sq ft of retail space, bringing the scheme up to 1.3 m sq ft.

Significantly, the 6.5m sq ft of shopping centre space currently under construction accounts for just 15 per cent of the total development pipeline. Another 16m sq ft of new shopping centre floorspace has planning permission, but work has not yet started on site. In many cases, construction was already due to have started but has been put on hold indefinitely, with no clear timetable in place for progress in the future.

The remaining 50 per cent of pipeline space is in the pre-planning or application stage. This includes the mixed-use redevelopment of the 40-acre Battersea Power Station site, where a planning application was submitted in October for 700,000 sq ft of retail space. Also of note is Lakeside in Thurrock where Capital Shopping Centres has begun to work up plans for an extension following the scheme’s designation as a regional shopping centre within the East of England, which will allow for new retail floorspace.

Colliers warns that forecasting future supply is an inexact science, because developers are remaining very tight-lipped about construction timescales in the current unpredictable economic climate. However it concludes that however much developers say they are committed to their projects, it is likely that many of the schemes in the pipeline will never be built out.

Colliers highlights several major schemes which are more likely to go ahead, including Northgate in Chester. ING and Land Securities are due to submit a new planning application shortly for a revised scheme following concerns that the development was no longer viable in its existing form.

Other schemes that have made progress in the past six months include Station Hill in Reading, where Sackville Properties has recently secured outline planning permission for its mixed use scheme providing 200,000 sq ft of retail. Work could start in 2011, with the first phase completed by 2014.

And in Northern Ireland, construction is due to commence in August next year on Fermac Properties’ Ramparts shopping centre in Coleraine town centre after receiving the go-ahead for 190,000 sq ft of retail floorspace in September. Completion is scheduled for Easter 2013.

Head of research Dr Richard Doidge stuck his neck out to say: “Assuming the economy did move out of recession at the end of 2009, the process of recovery should begin to take place this year and we would expect the first wave of major shopping centre development to commence on site in 2011/2012 leading to a peak in completions post 2013.”

But he warned: “This is very much dependant on a number of variables, such as the speed of the recovery, retailer demand, developer confidence and, ultimately, funding. What is clear though, is that for the next five years at least there will be very little new shopping centre floorspace coming onto the market.”

Printer friendly version

Email this article to a friend

Bookmark this

---