How Much Space? Research Team Dr Neil Blake, Experian Business Strategies Stuart Morley, GVA Grimley Michael Bach Objective To determine how much new and what type of retail space the UK can absorb over the next ten years.

Project Report How Much Space? > Download Executive Summary > Obtain the full report Press Releases BARKER-STYLE PLANNING REGIME WOULD LEAD TO AN OUT-OF-TOWN RETAIL DEVELOPMENT EXPLOSION 02/04/07 NON-FOOD EXPANSION MAIN DRIVER OF DEMAND FOR MORE SUPERMARKET SPACE ACCORDING TO BCSC REPORT 26/03/07

Background to the research

Approximately 1.4million sq m (14million sq ft) gross per annum of additional retail space has been absorbed by the UK market over the last 20 years and 3 million sqm (30million sq ft) is in the pipeline for delivery in the next five years: the purpose of this project is to examine in depth the drivers of demand for retail space and then to project these over the next ten years.

The demand side the research will consider trends in income growth and demographic change, real and nominal growth in retail spend over the next ten to fifteen years. Over the last 10 to 15 years growth in consumer spending has been above the level of GDP growth, this cannot continue. Moreover there is evidence that the share of consumption that goes to retail goods is declining due to such factors as demographic change.

On the supply side the research will take account of long run changes in efficiency of space, the growth of non-store shopping (internet), conversion of space currently used for food retailing to non-food space (e.g. by the large grocers) and changes in trading hours. On the regulatory side the research will consider the impact of the new planning policy statements and the guidance notes on the spatial distribution of retail space. It is possible that an ‘enforced’ sub-optimal distribution of space will have a negative impact on the overall level of space required.

Questions the research must answer

• How much space has the UK market absorbed in the past twenty years and how much on central projections will it be capable of absorbing in the next 10-15 years?
• What are the key factors that drive the ability of the economy to absorb space and to what extent are they likely to vary from the central assumption? In particular:
  - What is the impact of a major shift to internet shopping?
  - How does the slow transition to 24 hour trading impact on the demand for space?
  - Will a planning requirement to ‘distribute’ space evenly around sub-regional centres
  reduce the overall demand for space by making retailing less attractive to consumers?
  - Will dominant centres at the top of the retail hierarchy continue to absorb a
  disproportionate share of new retail investment?
• How will demographic change, including in-migration, and other long run changes to the UK economy such as slower growth of consumption, impact on demand for retail space? Other topics in this area are:
  - Are there regional differences in the amount of space required?
  - Will the pensions crisis feed through into lower retail spend at any point?
  - To what extent is the current level of floorspace dependent on consumer borrowing?
  - How much UK retail spend is leaking overseas due to the falling price of air travel and
  how will this change?
• Is the UK ‘over-shopped’ relative to other advanced capitalist economies?