High Street Prospects: bounce back or recalibrate? Part 3/3

A reflection on the prospect for UK high streets and town centres to find a new future in a post COVID-19 world: Part three: Benchmarking

While many indicators of town centre performance are biased towards retail metrics, there is still much useful data available with which to track performance. For example, ‘Town Benchmarking’, developed by the now defunct Action for Market Towns, comprised 12 KPIs, including vacancy rates, retail rents, and car parking provision. GENECON’s (2011) report, for the Department of Business Innovation and Skills, recommended 4 KPIs, comprising footfall, consumer and business satisfaction, diversity of offer, and consumer spend and business turnover.

The Association of Town Centre Managers proposed a 2-dimensional approach, comprising a first stage personality test linked to a classification matrix, followed by indicators grouped around 4 themes – people and footfall, diversity and vitality, consumer and business perceptions, and economic characteristics. The Distressed Property Task Force (2013) made use of Colliers’ Town Performance Matrix that used demand and supply indicators, such as vacancy rates, Zone A rents, catchment area, plus qualitative factors, to place towns into one of 5 classifications: thriving; improving; stable; degenerating; failing.

In combination with footfall and consumer satisfaction, the vacancy rate is perhaps the most powerful ‘tell-tale’ of relative resilience or vulnerability of high streets to respond to crisis conditions. The persistence of void units, particularly over the medium term (12-24 months) offers the most compelling sense of the relative health or distress of a high street or retail location.

Simplistically, there are 2 types of vacancy – natural, that allows for churn and turnover of retail outlets, and structural, linked to over-supply of retail stock and problems with its physical configuration. While there are many reasons for vacancy to occur, some are more benign, for example, changing retailer requirements, new developments, or a shift in the prime pitch, while others are more malign, such as falling footfall and consumer spend, leading to fundamental unprofitability, and resulting in business failures. The latter is sadly all too apparent due to CV-19 lockdown and, despite government measures aimed at reducing overheads and occupancy costs, it is questionable how many businesses on the high street will survive.

There is little doubt that structural vacancy is set to increase on high streets across the UK. How will this be tracked, monitored, reported and evaluated?

Given that town and city centres are highly complex urban ecosystems, comprising a series of markets and submarkets, with a wide range of stakeholders, it is often hard to bridge across from benchmarking and performance metrics, to more nuanced appreciation of how these factors are playing out ‘on the ground’ over time. What is missing is consistent longitudinal place-based analysis with which to both measure performance, and assess resilience or vulnerability, at the micro-scale e.g. at high resolution or fine grain.

Over the last 4 years, R3intelligence has been exploring the potential to use Geographic Information System (GIS) software and Valuation Office (VOA) Rating List data, to filter and segment millions of non-domestic hereditaments by bulk class, using SCAT codes (see aforementioned Terrier articles by Adebayo, Greenhalgh and Muldoon-Smith (Autumn 2017) and Ellis and Richardson (Summer 2019)). Such a tool fulfils some of the ambitions of BIS Retail Unit’s suggestion of a toolkit for finer grained, street level data collection and analysis.

The method developed by R3intelligence makes use of data covering all of England and Wales, available under licence from the VOA, and covers all retail units, regardless of size or status. The technique we have developed avoids the tendency of most retail market analyses to ignore secondary and tertiary markets, and smaller units, that are vital to entry level retailers and small businesses. A further level of complexity can be introduced by layering in-depth-map data representing street level configuration and integration, as a proxy for accessibility and pedestrian footfall.

The GIS can be further enhanced by feeding in vacancy data, typically compiled by local authorities, and increasingly available in the public domain, based on empty property rates. Such data can then be linked to the base ‘rating list’ data, using unique property or address reference numbers. The resulting multi-criteria data model can be used to reveal the incidence and concentration of high street voids, in relation to the total stock of retail premises, down to postcode level and potentially even finer grain geolocation, using individual address fields.

The data model can be interrogated, at a variety of scales, to offer an illustration and interpretation of the complex interaction between demand and supply geographies at street level, to track the incidence of voids units, act as a tell-tale of distressed locations, as well as identifying those that exhibit greater resilience. The use of GIS software also permits the opportunity to layer in other spatial datasets, to provide a richer and more complex portrayal of both the characteristics and prospects of individual high streets and secondary and tertiary retail nodes.

For further information,  please email the author.

References

The GIS method developed by R3intelligence is detailed in Paper #118 ‘Investigating retail space performance through spatial configuration of consumer movement: A Comparison of York and Leeds’, in the Proceedings of the International Space Syntax Symposium (SSS12) 2019, Beijing, by Adebayo, A., Greenhalgh, P. and Muldoon-Smith, K. available at: http://www.12sssbeijing.com/ upload/file/1562664603.pdf

Coca-Stefaniak, A. (2013) Successful town centres – developing effective strategies. ATCM. London. Available at: https://thegreatbritishhighstreet.co.uk/pdf/

Successful-Town-Centres.pdf Distressed Town Centre Property Task Force (2013) Beyond Retail: redefining the shape and purpose of town centres. Available at: https://thegreatbritishhighstreet.co.uk/pdf/Beyond-Retail.pdf

Fraser. M. (2013) National Review of Town Centres. Scottish Government. Available at: https://www.webarchive.org.uk/wayback/ archive/20170701074158/www.gov.scot/ Publications/2013/07/7250

GENECON and LLP (2011) Understanding High Street Performance. Report for Department for Business, Innovation and Skills. Available at: https://assets. publishing.service.gov.uk/government/ uploads/system/uploads/attachment_data/ file/31824/11-1433-understanding-highstreet-performance-summary.pdf

Grimsey, B. (2013) The Grimsey Review 1: the vanishing high street. Available at: http://www.vanishinghighstreet.com/wp-content/uploads/2016/03/ GrimseyReview04.092.pdf

Grimsey, B. (2018) The Grimsey Review 2: it’s time to reshape our town centres. Available at: http://www. vanishinghighstreet.com/wp-content/ uploads/2018/07/GrimseyReview2.pdf

House of Commons (2019) Housing, Communities and Local Government Committee: High streets and town centres in 2030; Eleventh report of session 2017-19 HC1010. Available at: https://publications. parliament.uk/pa/cm201719/cmselect/ cmcomloc/1010/1010.pdf

Office of National Statistics (2020) Internet sales as a percentage of total retail sales. Retail Sales Index Time Series. Available at: https://www.ons.gov.uk/ businessindustryandtrade/retailindustry/ timeseries/j4mc/drsi

Portas, M. (2011) The Portas Review: an independent review into the future of our high streets. Available at: https://www.gov. uk/government/publications/the-portasreview-the-future-of-our-high-streets

Wrigley, N. and Brookes, E. eds (2014) ‘Evolving High Streets: Resilience and Reinvention: perspectives from Social Science’ University of Southampton. Available at: https://eprints.soton. ac.uk/371874/1/Opinion_Pieces_ Southampton_Nov_2014.pdf

Wrigley, N. and Lambiri, D. (2015) British High Streets: from crisis to recovery? University of Southampton. Available at: http://www.riben.org.uk/ Cluster_publications_&_media/BRITISH%20 HIGH%20STREETS_MARCH2015.pdf

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