CAPITAL Shopping Centres (CSC) yesterday gave a grim update on how the retail sector was faring in the tough economy as it said that its occupancy rates had fallen while fewer people were hitting the shops.
The company, whose malls include the Lakeside in Essex and the Trafford Centre in Manchester, said the tough economy continued to take its toll on shopping habits. CSC reported occupancy rates of 94.3 per cent for the first quarter of 2012 – two per cent lower than at the end of 2011.
Footfall – the number of shoppers in the malls – was down 2.4 per cent. Three per cent of the shops renting units from CSC went into administration in the first quarter.
That meant the closing of 75 shops in the post Christmas period which is traditionally the peak for retail casualties. However, CSC said that 42 new long term leases had been signed, worth a combined £10m in annual rent. Meanwhile the company said that although its footfall had fallen, the decline was less than the three per cent national average drop.
The company said: “As long as the UK economy remains flat, we expect the letting environment to remain challenging.” On the upside, CSC said that retailers had been clambering to secure large units for flagship stores. It said: “Retailer demand for larger spaces for flagship stores in the highest footfall locations remains strong, given the very limited shopping centre construction pipeline in the UK.”
CSC said it was benefitting from last year’s £1.6bn acquisition of the Trafford Centre.