Down-at-heel shopping centres get new lease of life

Some of the UK's less salubrious shopping malls are getting an unexpected boost from the credit crunch...

Last Updated: 06 Nov 2012

In the last few years, developers have been competing to open new shopping centres that were shinier and glitzier than ever before – the most recent being the (rather ill-timed) Westfield Centre, just down the road from MT in West London. But as more and more of us look to tighten our belts, it looks as though some of this year’s big winners could turn out be the kind of centres that Westfield’s target shopper wouldn’t be seen dead in – and it’s largely thanks to the success of some of the UK’s least glamorous retailers….

Take Cash Converters, for example. Recently MT caught up with Mark Lemmon, its UK boss, who told us that the chain's sales were up 10% on a like-for-like basis in the first two months of this year. Cash-strapped shoppers were realising that his stores were ‘the place to come for a bargain’, he said – and since more and more people are cutting back on the credit cards and opting to sell their stuff for cash instead, his stores have plenty to sell. As a result, he's already plotting further expansion (and unlike most businesses, the banks are actually keen to finance it).

It’s a similar story for other value retailers. As British shoppers have started cutting down on the conspicuous consumption, discount clothing chains like Primark, Peacocks and TK Maxx have all seen sales boom, while Aldi and Lidl have been eating into the Big Four’s share of supermarket spending. Right at the bottom end of the market, chains like Poundland and 99p Stores (which recently announced plans to open another 100 stores) are seeing their cheap-and-occasionally-cheerful wares fly off the shelves. And designer outlet centres are also thriving, as customers hunt for brand names at bargain prices.

All of which is proving to be a boon for the likes of property company St Modwen, owner of several shopping centres that are, by its own admission, of ‘secondary quality’ (a euphemism that could hide all manner of unpleasantness). According to a report in today’s FT, its centres (like one in London’s Elephant and Castle, which was actually scheduled for demolition last year) are letting up ‘incredibly well’, with record rents and high levels of occupancy – mostly from budget retailers taking advantage of their cheap rents to snap up new stores.

So the high street slowdown clearly hasn’t been bad news for everyone. Though we suspect some of you may argue that the demolition of ugly, dingy shopping centres would actually have been rather a good thing for our towns and cities, if only from an aesthetic point of view...

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