Following the outbreak of the global pandemic, tens of thousands of stores closed their doors in the United Kingdom. Not only was this due to the changing buying habits of consumers, from in-store purchases to online shopping, but also the rising costs of energy and rents.
If you’re thinking about opening a retail outlet or investing in the retail space, you might be wondering what the average prices are around the United Kingdom and if the costs involved are worth it. In this article, discover the cheapest and most expensive retail rents across England, Scotland, Wales and Northern Ireland to help you make an informed decision.
For a taste of rental costs around the UK, you can check out an online rental platform such as rentola.co.uk. It lists everything from high street rentals in Hampton to houses in the Scottish Highlands and everything in between. By understanding the rental costs you may be faced with, you can decide whether your retail pursuit will be financially viable.
Average Retail Rentals in the UK
The following results were created by benchmarking the retail listings on Zoopla and Rightmove against the commercial property search engine Realla. The research was conducted in 2021 as the world was returning to “normal” following the global pandemic.
Unsurprisingly, London topped the list of most expensive retail rentals in the UK, with an average price of £49.64 per square foot per year. This is due to its abundance of tourist attractions and relatively high footfall, giving retailers a better chance of getting their products to customers. London was followed very closely by the university city of Oxford, which continues to thrive in the retail space due to council investment. Next up was historic York, with Cambridge, Leeds and Chester not far behind.
Edinburgh was the most expensive place to rent a retail space in Scotland at £34.49 while Cardiff was the costliest in Wales at £27.11 per square foot per year. This makes sense, with both capitals serving as important political, cultural and commercial hubs. The Northern Ireland capital, Belfast, came in at 38th place on the list, with an average price of £24.95 per square foot per year.
At the cheapest end of the spectrum was Blackpool, with an average square foot per year rate of £12.45. But with tourist numbers increasing to the seaside resort, it might not stay this way for long and Blackpool could be a lucrative place to get a foot in the door of the retail industry.
Average Retail Rentals in London’s Boroughs
If you’re focusing your attention on London, then it’s important to remember that the average retail rentals vary significantly from borough to borough. Kensington & Chelsea was the most expensive area to rent a retail space at £86.18, with this reflected in the designer brands and specialty shops that line Kensington High Street. The next most costly, the City of London, was more than £20 less at £63.96 per square foot per year, followed by Camden at £56.21 and Westminster at £49.36.
If you’re looking for the cheapest London borough to rent a retail space, then head to Barking and Dagenham in the city’s east. It forms part of the Thames Gateway, an area that’s set to undergo significant urban regeneration, so it might not stay cheap for long. The nearby borough of Havering was around the same mark at £23.70 while Hillingdon, on the other side of London, had an average retail rent per square foot per year of £26.08.
Footfall Recovery Rates in The UK
When searching for affordable retail rents, it’s important to take into consideration the area’s footfall recovery rate, which reflects how it is bouncing back in the wake of the pandemic. Across the United Kingdom, there has been a slow but steady increase in the number of people who are back on the streets shopping, with retail parks proving to be more resilient compared to high streets.
Plymouth has proven to be the most successful city when it comes to footfall recovery, followed closely by Blackpool, Dundee and Swansea. Burnley, Barnsley and York also made the top 10, as did Sunderland and Southend-on-Sea.
Interestingly (and despite its high rental price per square foot), London has one of the lowest footfall recovery scores in the United Kingdom. Whether this is to do with office employees working from home, a shift in shopping habits or consumers opting to shop locally (rather than travel into London) remains unknown. But it suggests that businesses in the English capital might not be getting value for money.
Also near the bottom of the table are Birmingham, Slough and Luton, as well as Manchester and Milton Keynes. Analysts suggest that footfall levels won’t return to pre-pandemic levels anytime soon due to a shift in shopping habits that is unlikely to be reversed.