Retail park peak rents on the increase - commercial mortgages

11 April 2007

The number of UK retail parks with peak rents is on the rise according to new figures, indicative of higher availability of prime retail park space across the country.

The new Definitive Guide to Retail and Leisure Parks 2007 indicates that the proportion of retail parks with rents above £25 per square foot has increased to 20 per cent of the overall retail park stock, up from 17 per cent in 2006.

It was also found that the disparity between cheaper and more expensive rents is growing, with the current variation sitting between £6 per square foot and £95 per square foot.

A wider choice of retail parks in different value brackets could prove attractive for commercial property investors willing to take out commercial mortgages, especially as retail parks grow in popularity. However, Mat Oakley of Savills explains that demand for larger retail parks could be on the decline.

"While we are seeing many retailers leaving the high street in favour of retail parks, where rents are more competitive, we are also witnessing existing large space occupiers at retail parks changing priorities in a bid to control rent bills," he told Property Executive.