Edinburgh is the preferred venue for top retail brands moving to Scotland, according to a report out today by commercial property firm Colliers International, which shows the capital out-competed its bigger rival Glasgow in recent years.
Colliers’ National Retail Barometer found that international retailers expanding into the UK beyond London preferred new property developments and sought affluent areas and tourist destinations that provided extra global visibility for their brand.
The Barometer tracked the openings of ten international brands, including Michael Kors, Nespresso, Victoria’s Secret and Zara Home, to see where they chose to target their initial phases of expansion beyond London. Leeds was the surprise top choice with six openings, beating a number of locations in the Midlands and South of England.
But the map showed that Scotland and the North of England were lagging the field. Edinburgh attracted three such stores and Newcastle two, with none choosing Glasgow as the home for one of their first three regional outlets.
John Duffy, a director with Colliers International in Scotland, said that the result was somewhat surprising, as Glasgow remained the second strongest retail hub in the UK, behind London. However, the West Coast city may have suffered due to a lack of new developments to attract top retailers.
He said: “These are aspirational or luxury brands and they generally want the newest, highest quality developments – in Scotland, there has been very little premium retail development in recent years. Edinburgh has provided new space at St Andrew Square and there is already a buzz around the St James Centre redevelopment, but Glasgow’s Buchanan Galleries extension has been put on ice in the last nine months.
“Nevertheless, this should not distract from the fact that Glasgow remains a very strong retail centre – rents are growing and in terms of sales density it remains well ahead of Edinburgh.”
Ross Wilkie, also a director with Colliers in Scotland, said that Edinburgh looked set to regain more ground on Glasgow as a shopping destination in the years ahead.
He said: “The St James Centre probably won’t be completed until 2020 at the earliest, but it has captured the attention of all the top international retailers, such as the ten used to compile the Barometer. As a short term effect, Princes Street will continue to thrive, as shops are displaced while the work takes place. Soon, pre-lets will be in full swing and we predict this development will take Edinburgh back into the top ten of UK shopping destinations. That’s quite an achievement considering its size – it certainly punches above its weight.”
The National Retail Barometer also showed that prime city centres and top shopping centres continued to enjoy a recovery in rents and vacancy rates, but largely at the expense of smaller towns.
Mr Duffy said: “This has been the theme for a few years now and it shows no sign of reversing. Whereas ten years ago a national retailer would have used 200 stores for full UK coverage, now they are doing it with 50 and filling the gaps with multi-channel offerings. People will travel to shop where they have the best choice and, increasingly, where they can combine it with other leisure activities.
“However, it is a mixed picture as some smaller destinations are managing to thrive, whereas some towns mostly where there is an over-supply of units are really struggling.”