Don’t Expect Your Retail Tenant To Have Had A Good Christmas
Any retail property owners hoping their tenants saw a big boost in trading over Christmas are likely to be disappointed.
Footfall figures for the crucial pre- and post-Christmas period showed brick-and-mortar stores continuing the 2019 trend with big falls in visitors, which is likely to translate into lacklustre sales.
In the last full week before Christmas, visits to non-food stores fell by 14.2% compared to the same week in 2018, according to data from Ipsos Retail Performance. That was in spite of many retailers bringing forward their traditional post-Christmas sales. Footfall on the last Saturday before Christmas was down 6.2%.
The stereotype of the man doing a last-minute dash for gifts also failed to provide any succour: Ipsos said Christmas Eve footfall was down 9.4%.
Things did not pick up after Christmas either, in spite of retailers discounting goods more deeply than usual. Footfall in the period from Boxing Day to 1 January was down 4%, according to Springboard.
There were some exceptions to the general downward trend. The New West End company said footfall in London’s West End was up by 0.2% in the last week of December, with the numbers buoyed by international visitors.
But even the positive stories were somewhat nuanced for the owners of retail property. Next said full-priced sales rose 5.2% in the period from 27 October to 28 December, 1.1% ahead of its expectations. But that was mainly driven by online sales, which increased 15.3%. In-store sales dropped by 3.9%, although that figure is not as bad as analysts had expected.
Even though Next is one of the UK’s more profitable fashion retailers, earlier this year it said falling in-store sales meant it would need to cut its rents or close stores.