The resilient cities - London, Glasgow, Edinburgh, Cambridge, Oxford and Brighton have sheltered from the retail storm. Tourism, affluent catchment characterisitcs and prevalence of universities have driven performance in these cities, and we expect them to continue to outperform the wider market.
Prime grade retail assets have outperformed the rest of the sector. During the last five years, prime (or low yield) assets have recorded rental and capital growth – in contrast to the rest of the market that has seen declines. Prime assets in affluent cities have expansive catchment areas (in some cases spanning hundreds of miles), and attract the wealthiest consumers.
Health & beauty and food & beverage (F&B) are, and will continue to be, the most resilient retail sectors – with growth in the latter focused on independents and quick service restaurants. We analysed net store openings, physical retail sales growth, and online penetration data to understand which sectors are most likely to continue weathering the storm. Electricals and clothing were the most negatively impacted – due to the strength of ecommerce in those sectors.