Making the case for repurposing our town centres
This is the first in a series of long-read blogs and over the next few weeks we will be investigating what it means to undertake sustainable repurposing, through different uses, masterplanning, funding and policy.
For further detail, Savills’ recent research on Re:Imagining Retail is available here.
Tom Whittington
The headwinds
The Towns Fund presents an opportunity to reimagine and reinvigorate our Towns. Many Town Investment Plans include some element of masterplanning, urban design and regeneration, but all TIPs consider how Covid-19 is affecting our place, economy and society.
Covid-19 caused us overnight to change the way we think about how we live, work and play, but these changes were coming. E-commerce has accelerated while the shops have been closed, and it is likely to settle at around 25% of spend by the end of the year. But flip that stark statistic on its head and 75% of retail spend is still expected to remain in-store when things return to the next normal.
Perhaps the biggest change will be how we work. Social distancing will ease, but we have learned that it is possible to do our jobs remotely at least some of the time. Even a 20%, or single day, shift in behaviour could alter the need for retail space in city centre locations, and by the same token increase the need where people live.
Over the last decade, we have seen the consumer need for value, quality, convenience and experience take precedence. There is no doubt we are seeing swathes move online, become more ethical, more health conscious, more thrifty and yet more indulgent. From the way that much retail development has been undertaken in the last few decades you’d think that we’re all the same. But of course, we’re not.
In the post-Covid-19 environment, let’s not assume that all people will change the same, want the same, or behave the same. Do we really want our town and shopping centres to be the same too?
Despite the immediate challenges facing the sector, most retail places will recover in some form, consumers are not about to leave shops and restaurants for good. Yet, many towns have been suffering from decades of decline, not just 12 months of it. Some may have even seen a boost in spending in some sectors. The impact from the pandemic may have been a perfect storm for retail, but the issues are already deeply familiar in locations across the country.
Either way, the real question going forwards, is how much retail space do we actually need and what do we do with that we actually don’t?
A question of voids
The declining need for space is by no means a new phenomenon, as any town planner that has witnessed the movement from in-town to out-of-town retailing and then the rise of ecommerce knows very well. For as long as I can remember, we have continued to expand space on the simple promise of consumer growth.
So how much space is too much? In the UK there is 142 million sq feet of vacant retail floorspace and the average void rate is around 13%. Not all retail places are affected equally, but nowhere is immune to the challenges. It’s not that they don’t function as retail spaces, they simply have too much of it.
The void rate itself masks a more serious concern, void length. Even in the most successful retail places there is an increasing proportion of vacant units that are empty for long periods or even permanently. 40% of vacant units have now been empty for 3 or more years and this is arguably now redundant space. If you don’t agree, consider who will take the space on a long lease and add something valuable to the community it serves?
This problem has been creeping up on us for a long time and Covid-19 or not, is reaching a critical moment in which we need to radically change our thinking of all retail places and town centres.
Savills analysis predicts that by the end of the decade 300 million sq ft of retail space may no longer be required.
But it doesn’t have to be this way. This is the ‘do nothing’ scenario. And one that we need to think of as not just a problem, but an opportunity, if we have the confidence to remove dead space.
An opportunity to revive the sector
Repurposing redundant retail provides a significant opportunity to breathe life back into town centres, which post-Covid-19 will be more important than ever. We need to reimagine the real function of consumer ecosystems, which will often mean not thinking about retail places as retail only places.
It’s not that retail is dead. There’s too much of it, but that isn’t the same thing as saying it is redundant or denying it a central role in where and how we spend our time and money.
This is not the death of the high street, but it might be the death of the high street as we know it.
Future retail spaces will be hybrid spaces. Mixed uses benefit all uses by interlinking journeys, creating footfall and operating different day parts. They have the potential to make places that are more vibrant, have greater social value, are more sustainable and more resilient.
This is not a ‘one solution fits all’ scenario, but most places have something they need. The challenge is working out what that need is and of course enabling it through funding, proactive management and masterplanning. It is by no means easy, but the results can be incredibly positive for the communities served.
There is no doubt that we are in for some significant changes to our working, living, social and shopping behaviors over the next decade. Disruption can be painful, but it can also be positive. We can choose to do nothing, or we can embrace the opportunity for change.
The Repurposing journey starts with retail, but it ends with better, more resilient and sustainable town centres and consumer hubs. That, we hope you’ll agree, is an exciting proposition.