Christie & Co annual report reveals appetite for quality retail premises
DEMAND for retail properties in Scotland was high in 2019, resulting in some strong sales – particularly in the petrol filling station sector.
That was the assessment of Christie & Co in the commercial property specialist’s Business Outlook 2020 review of the Scottish market.
The firm found that as both corporate operators and independent buyers sought out businesses, two themes emerged: location and ability to add value.
Christie & Co predicted that these trends would “undoubtedly” continue through 2020 – although the report was published before the magnitude of the coronavirus crisis was understood.
Last year saw companies churn estates as operational costs rose, a trend which Christie & Co expects to continue this year, alongside improvements in retail offers and store standards.
Within the convenience store sector, Christie & Co found that a lack of freehold supply in 2019 constrained buying and selling.
The firm reckons freehold properties remain popular with purchasers who “recognise the inherent value of bricks and mortar.”
In terms of sale price, Christie & Co noted a reduction for convenience stores operating at the lower end of the market, which it attributed to “a degree of oversupply relative to demand, as well as the increasing price sensitivity you might expect.”
While Brexit may have generated headlines in 2019, Christie & Co suggested the effects of Britain’s exit from the EU on the convenience store property market were muted.
What has been affecting price, however, is the National Living Wage – according to Christie & Co.
As wage bills rise, the property firm recognised that retailers will be faced with the choice of absorbing them or passing them on to consumers – which could be a tough sell in a price-sensitive market.
Activity across many of our sectors slowed down towards the end of 2019 as political uncertainty led to a tailing off across the hotels and retail sectors.
Brian Sheldon, regional director for Scotland at Christie & Co commented: “Activity across many of our sectors slowed down towards the end of 2019 as political uncertainty led to a tailing off across the hotels and retail sectors.
“Across all of our sectors there is appetite for well-established and profitable businesses across the country.”
