Home Outlet store Almost 90% of Debenhams stores are still empty a year after the collapse | Retail business

Almost 90% of Debenhams stores are still empty a year after the collapse | Retail business


Almost 90% of former Debenhams stores remain empty nearly a year after the department store last closed, a sign of the challenge of reinventing high streets across the country.

The empty stores are among nearly 8,000 outlets left empty last year, according to a report from analysts at high street Local Data Company (LDC), as Covid lockdowns accelerated the shift to online shopping and bludgeoned city centers.

However, this figure was down from 11,319 net closures in 2020, as fewer businesses fell into administration, while more than 43,000 new businesses opened, an increase of more than 10%.

Fast food outlets, barbers, grocery stores, cafes and beauty salons were the fastest growing sectors as independent businesses took advantage of cheaper rents to get started.

There was also a significant rebound in the leisure industry, with the net closure of 52 outlets compared to 2,640 a year earlier, as restrictions on restaurant dining eased and food businesses take-out continued to thrive. Clothing stores, banks, charity shops and pubs have been hardest hit.

Lucy Stainton, commercial director of LDC, said department stores posed a particular problem, with just 12% of recently vacated sites now reoccupied, while just over a fifth of former BHS outlets remained empty five years after the department store collapsed as a result of the costs of developing and maintaining such large sites.

She said landlords and councils should think beyond retail to fill space because there was a ‘ripple impact’ on the attractiveness of a town or shopping center when key sites remained vacant.

Ongoing projects include the transformation of the old Debenhams in Gloucester into a student campus, while the Kendals building in Manchester, which houses House of Fraser, is to be converted into offices.

There are signs of recovery as owners redevelop empty buildings to accommodate a new fast-paced commercial and leisure landscape. The proportion of vacant premises fell from 14.5% to 14.4% after six years of increase.

More than 9,100 commercial and leisure premises were restructured in 2021, up almost 49% compared to the previous year. However, 5% of high street outlets have been empty for more than three years and 6% of those in malls, according to the report.

LDC foresees a gradual reduction in the vacancy rate over the next few years, but does not expect a rapid return to pre-pandemic levels. He said ‘drastic action’ was needed to adapt shopping destinations, including more redevelopment – and there could be a net reduction of 9,000 in the number of high street shops and services such as banks and leisure businesses next year.

The report signals the end of the commercial rent moratorium, activity rate relief and subsidies for occupiers and local authorities this spring, as well as inflation driven by rising costs for retailers, rising interest rates and an increase in national insurance. It says these factors “are likely to make 2022 another challenging year for occupiers in the retail sector.”