Since 2010 more than 20,000 shops have ‘disappeared’ from high streets and the communities that they once served having pulled down their shutters for the final time, according to the real estate adviser, Altus Group.
Analysis of official Government data by Altus Group reveals that, between 2010 and 2019, 20,143 shops in England and Wales, liable for business rates, have ‘disappeared’ being converted into homes, different types of use such as restaurants and cafes or having been demolished.
During the same period, Altus Group say 14,314 ‘new’ shops came onto the Local Rating Lists meaning that the overall number of shops has fallen by 5,829.
The total number of shops in England and Wales has fallen from 430,360 on 1st April 2010 to 424,531 today according to Altus Group. The Centre for Retail Research suggests, within the next 5 years’, that the overall number of shops will fall even further by 8,500 to around 416,000.
The numbers do not include those shops which are currently vacant and to let. The national town centre vacancy rate climbed to a 4 year high of 10.2% in April according to the British Retail Consortium vacancies monitor putting the number of empty shops at 43,302.
Robert Hayton, Head of UK business rates at Altus Group, says that “we are witnessing a re-purposing of surplus retail space” adding “over the coming months and years ahead, as retailers continue to reduce their store portfolios with the growth of online shopping, there will be an increase in the intensity of that re-purposing.”
The Government has committed £900m in business rates cuts aimed at independent high street firms slashing bills by a third from 1st April for 2 years for those smaller retail properties in England with a Rateable Value less than £51,000.
A number of Tory leadership hopefuls are also pledging to scrap business rates for the high street SMEs which Hayton describes as “commendable” but stresses “tax measures are also needed for major retail and hospitality businesses who are reducing their estates and headcount often citing high rates as a contributory factor. They are currently paying the highest standard rate of tax since the national business rates system was introduced in 1990.”
Professor Joshua Bamfield who is a Director at the Centre for Retail Research added “The fact is that business rates, rising labour costs and low levels of profitability are driving retailers out of the sector and this problem will get worse, not better. The Government has done a lot to reduce the impact of business rates upon smaller retailers, but that ignores the major impact that rates have on the larger businesses that face similar problems.”
It has been estimated that business rates represent 42% of all the government taxes imposed on the largest 1,000 retailers.