Posts from February 2023

A portfolio of 37 commercial property assets fell in net asset value by nearly £27 million in the final three months of 2022. A financial update released today by AEW UK REIT revealed a fall in value from £193.08m in September 2022 to £166.24m by the end of the year. This was a fall of 10.82% in like-for-like valuation for the quarter. The portfolio consists of 11 retail units, including retail parks in Barnstaple, Coventry and Shrewsbury, as well as four leisure units, with a JD Gym in Glasgow, a Dagenham leisure park, an Odeon in Southend, and a Pryzm nightclub in Cardiff. Highlights for the group in the quarter included the acquisition of three units, for a total valuation of around £34.6m. Laura Elkin, portfolio manager, AEW UK REIT, said: “Following interest rate rises and the unfolding UK macro-economic backdrop, real estate valuations across all market sectors, in particular at the prime end of the industrial and warehousing sector, fell significantly during the quarter. The value of the company’s assets has not been immune from this trend”. However, she added that “volatile markets can present significant opportunities for an actively managed value strategy”. “During the quarter, vendor requirements for sale led to valuations moving...

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Union condemns Argos warehouse closures

Unite the Union has said there is no economic justification for the closure of two Argos depots, stating that owner Sainsbury’s should instead be investing in its workforce. Sainsbury’s today announced the closures of an Argos warehouse in Basildon, Essex and a depot in Heywood, Greater Manchester, both set to shut by 2026. The move could impact over 1,400 jobs in total. The grocer added that it would also be closing its Milton Keynes office in response to recent flexible working changes it has introduced, but added that staff at the site would be unaffected. Since its takeover of the catalogue retailer in 2016, Sainsbury’s has closed the majority of high street Argos stores, moving 150 into concessions in its supermarkets. Sainsbury’s has since come under criticism for today’s decision, with Unite the Union citing huge profits at the supermarket as an argument against the closures. Unite national officer Matt Draper said: “Management at Argos/Sainsbury’s has yet to provide any form of business case for the loss of these jobs. Unite will be fighting to preserve every job and will put forward an alternative business case to the company to preserve employment at these two sites.” “If Sainsbury’s doesn’t drop its...

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The Springs credits boosted trade to new infrastructure

The Springs retail and leisure centre in Thorpe Park, Leeds has attributed much of an increase in footfall and trading to the opening of the new East Leeds Orbital Route. The East Leeds Orbital Route is part of the East Leeds Extension programme, designed to create growth in the city through investment in infrastructure and housing. Sales numbers for the retail and leisure centre revealed that trading figures for most stores at the scheme increased year-on-year since its opening five years ago. The Springs said that trade had increased significantly in December 2022, in some stores by more than 50%. Rachel Vickers, senior commercial manager at Scarborough Group, which delivered The Springs alongside Legal & General, said there was “no doubt” the East Leeds Orbital Route opened up the scheme to a wider catchment. “Retail is not dead, it is merely evolving. While online shopping continues to surge, a day out looking for inspiration and personal interaction is still an attractive proposition for consumers, particularly post-pandemic. Our growing leisure amenity and wide-open spaces with ample free parking are also a big draw”, she added. This follows recent news that café and bar group Loungers announced plans to arrive at the...

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Roxy Leisure reappoints director in expansion plan

Former operations manager of Roxy Leisure, Ben Warren, has returned to the group as managing director. He has most recently worked at sister company Concept Taverns, where he spent five years as managing director. He returns to his former company to oversee expansion plans which would see Roxy Leisure nearly double in size within the next two years. Roxy Leisure operates both bowling concept Roxy Lanes and multi-use leisure concept Roxy Ball Room, which currently operates 14 sites in the UK. The group is aiming to add a further six sites in both 2023 and 2024. Having previously opened a second Birmingham site earlier in February, Roxy Leisure is due to launch a site in Cardiff in March.

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Bubble tea brand targeting more Scottish sites after Glasgow launches

Bubble tea brand Cupp is to open four more Scottish sites after launching its second Glasgow store. The brand, founded in Bristol in 2012, made its Scottish debut with an opening at Byers Road in Glasgow at the end of 2022, before following up with another site in the city’s Sauchiehill Street. Cupp is then due to open a third Glasgow site in Southside, before further Scottish launches in Edinburgh, Aberdeen, and Dundee. Further sites are in the pipeline for the rest of the UK in Nottingham, Exeter, Blackburn, and Guildford, bringing the total number of sites to 31. Cupp operates a franchise system, with a fee of £17,000 for aspiring franchisees, and £80,000 of capital required to open a store.

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John Lewis boss leaves after less than three years in role

John Lewis executive director Pippa Wicks will leave the partnership after less than three years in the job, as rising prices and a resurgent M&S threaten John Lewis’ position. Wicks will be succeeded by current John Lewis retail director Naomi Simcock on an interim basis. Although the retailer has said that Wicks is stepping down, The Telegraph has reported that she was sacked by Dame Sharon White, chair of the John Lewis Partnership. Before joining John Lewis in June 2020, Wicks was deputy chief executive of The Co-Operative Group, and has also previously held roles at Bain & Company, Courtaulds Textiles, and business consultancy firm AlixPartners. Pippa Wicks said: “I am proud of the considerable transformational progress the highly talented John Lewis team has made over the past few years, especially given the difficulties caused by the pandemic. It has been a real privilege and honour to work for the Partnership, and help transform John Lewis which is one of the most respected brands in the country.”

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Electrics retailer AO increases outlook for second time this year

Online electrical giant AO has upped its profit guidance for the year to March 2023, the second time the retailer has increased its outlook in as many months. Crediting a number of cost-cutting measures laid out in its November trading statement, AO said it continues to see traction from initiatives taken by the business to improve margins. The retailer now expects earnings to be in the range of £37.5m to £45m for the full year, an increase on its previous prediction laid out in January of £30m to £40m, which was itself higher than AO’s November guidance. AO said that a resilient underlying customer base, along with cost-cutting measures, had delivered higher margins than previously expected. “The steps we have taken to simplify the business and become more efficient have outperformed expectations and been delivered quicker than expected”, the retailer said.

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Sweaty Betty to join Liverpool ONE

Lifestyle and activewear brand Sweaty Betty is set to open at Liverpool ONE this June. The 2,600 sq ft space on Peter’s Lane will be the retailer’s first standalone store in the city, and its largest in the north of England. Featuring Sweaty Betty’s range of clothing and accessories, the store will join the retailer’s growing international presence, with stores in countries including the USA, Ireland, Germany, Hong Kong, Singapore, and Canada. Sweaty Betty’s signing at Liverpool ONE follows the news of the relocation of retailers Hollister and Gilly Hicks on South John Street. Mark Smith, chief operating officer at Sweaty Betty, said: “As we continue to grow Sweaty Betty’s presence both nationwide and globally, we’re delighted to have secured this strategically important, Liverpool ONE location, for what will become our largest store in the North of England.” Metis and CBRE acted for Liverpool ONE, which is owned and managed by Grosvenor, while KBW acted for Sweaty Betty.

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Majestic Wine looking to open 10 stores a year

Specialist wine retailer Majestic Wine says it is looking to open 10 new sites every year, as it continues a period of rapid expansion. The retailer has over 200 stores in the UK and has recently opened sites in Stafford, Preston, Godalming, and Haywards Heath. Majestic is looking for sites from 2,500 sq ft to 5,000 sq ft in size with Use Class E permissions. Seeking locations with ground floor trading space, the retailer is looking for prominent sites at busy retail parks and city centre locations. While ideal sites will have dedicated parking, urban locations with nearby on-street parking will be considered. Majestic Wine is looking for locations both inside and outside of London, primarily considering areas with wealthier, middle-class catchments. Jackson Kriss and Rapleys have been appointed by the retailer to find potential sites.

Dealing reopens on £358m UK commercial property fund

Asset management giant Columbia Threadneedle (CT) is to lift a temporary dealing suspension on its UK Property Investment Fund (CT UK PAIF) as well as its feeder fund. Dealing in the commercial property fund was suspended in October 2022 after cash fell to a level where redemption requests would not be able to be met. CT has said that following a sales process, it believes enough cash has been raised to mitigate this. The October suspension meant that investors have been unable to buy or sell shares in the fund, which at the time was valued by CT at £453m The property investment fund and its feeder fund invest in UK commercial property, within retail as well as warehouses and offices. As of January 31 2023, the fund was valued by CT at £358m. The lift on the dealing suspension will take place on Tuesday. Fund manager Gerry Frewin said: “We are pleased to reopen the fund following a successful asset sale and continue to believe in the fundamentals commercial property provides to long-term investors in a balanced and diversified portfolio. “The CT UK PAIF continues to be a well-diversified portfolio of commercial UK property, with an overweight position to...

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Karen Millen pop-up marks first physical store in four years

Karen Millen is set to open its first physical store since 2019 with the launch of a pop-up space in March. The store will open in central London from 3-5 March and will offer a number of services including personal shopping appointments, a beauty corner with various treatments, a wine bar, and small alterations offered by partner tailoring company The Seam. The new store will open in 6-10 Great Portland Street, Westminster. The retailer shut down all its stores and concessions after it was bought out of administration by Boohoo in 2019.

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Jigsaw plans three new openings in expansion programme

Fashion retailer Jigsaw has unveiled plans to open new stores, after bouncing back from a CVA which saw a quarter of its sites shut down. The retailer was one of many affected by the Pandemic and shut around 30 of its stores in 2020. However, Jigsaw returned to profit last year, making an operating profit of £1.2m in the year ending January 2022, up from a loss of £21m the previous year. The retailer is now set to open new stores in Manchester, Islington, and Kingston. Last month Jigsaw opened a new store at Battersea Power Station. Speaking to The Times, Jigsaw chief executive Beth Butterwick said: “We will open as many stores as we can agree and find the right location”. “We feel really positive about the role of stores. The high street has gone through a battering and some high streets are reshaping themselves. Going back into locations where we were before feels like the right thing to do”, she added. Butterwick also said that Jigsaw could open around 20 new sites in the coming years.

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Primark trades ahead of expectations

Primark owner Associated British Foods (ABF) has adjusted its expectations for the retailer for the financial half year. ABF now believes total sales at the retailer will reach £4.2bn for the half year, 19% ahead of the same period a year prior. The group said that sales at Primark had been bolstered by an increase in footfall in the UK and Europe, with sales in 2021 and 2022 affected by disruption caused by the Omicron variant, while COVID restrictions remained in place in many European countries. ABF added that all new Primark stores that have opened in the financial year are performing well, and expects its retail selling space to reach 17.8 million sq ft for the half year, ahead of 17 million sq ft the year before. It added that Primark’s market share of the UK’s clothing, footwear, and accessories market increased from 6.3% last year to 6.8%. Associated British Foods said: “Looking ahead to the second half, we remain cautious about the resilience of consumer discretionary spending in the face of continuing inflation in the cost of living and higher interest rates. Our expectation is that like-for-like sales growth in the second half will be lower than that...

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O2 enjoys strong January and half term trading

The O2‘s Entertainment District and its outlet shopping centre, Icon Outlet, have hailed a strong period of trading in January and over February half term week (13-19 February). This follows a successful 2022 for the Waterfront Partnership-owned schemes, a joint venture between AEG and Crosstree Real Estate Partners. January outlet shopping sales at The O2 were up by 34%, while sales across leisure and food and beverage in the Entertainment District increased like-for-like by 44% against 2022. February half term week at the destination saw its highest footfall levels so far this year, as the entertainment district recorded a sales increase of 15%, while outlet sales rose by 5%, both on a like-for-like basis against 2022. Sales in bars jumped by 77% in February half term, while leisure saw a sales increase of 23%, with a number of attractions including TOCA Social, BOOM BATTLE BAR, Oxygen Freejumping, and Mamma Mia! The Party bolstering the offering. The O2 has a busy year ahead, welcoming comedian Peter Kay once a month while Elton John will be performing at the venue for 10 nights, while iFLY Indoor Skydiving is set to open. In 2022, The O2 welcomed over 54,000 sq ft of new...

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Opening time for TAG Heuer in Dundrum

Luxury watch retailer TAG Heuer has opened a boutique store in Dundrum Town Centre. The opening marks the Watches of Switzerland Group’s first mono-brand boutique in Ireland and the 21st TAG Heuer boutique in the group’s portfolio. The store will be situated on the ground floor of the scheme near the main entrance. Craig Bolton, president of UK & Europe at the Watches of Switzerland Group, said: “As Ireland’s largest shopping destination, Dundrum Town Centre represents the perfect location for our first TAG Heuer mono-brand boutique in Ireland and marks a significant milestone as we expand the Watches of Switzerland Group’s accessibility across Europe.” Rob Diver, managing director of TAG Heuer UK and Ireland, added: “This new space will enable us to offer our clients a fully immersive in-store brand experience in the region and is part of an exciting journey with the Watches of Switzerland Group, as the first of several boutiques to be opened over the coming months.”

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Success for Orinsen at Scottish Property Awards

Edinburgh-based property consultancy Orinsen has celebrated winning Retail and Leisure Agency of the Year at the Scottish Property Awards. Founded in tumultuous times in early 2020, Orinsen was recognised on Thursday night for its success in supplying clients with strategic investment and asset advice. All four founding partners of the agency previously worked at Eric Young & Co, with Andy Bain and Tom Forster joining founder Eric Young for a number of years, before Anna Hansen’s arrival in 2017. The firm says it saw growth in 2022 of over 30% against the previous year. Director Anna Hansen said: “We couldn’t have chosen a more challenging time to launch – January 2020 – when little known to anyone a global pandemic was going to create seismic shifts across everyone’s lives and businesses.” “Despite the obvious challenges of the past two years we’ve worked hard and had fun while we do it. We seen our team grow and grown our business too with clients spanning the UK from Southampton to Inverness”, she added.

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Sainsbury’s to trial four-day working week

Sainsbury’s is trialling a four-day week for its head office and warehouse workers as well as its in-store managers. Staff at the grocer have been given the option to work their 37.5 hour a week contracts over four days a week, however they are not permitted to take two consecutive Fridays off. Staff at Sainsbury’s stores below management level have not been given the offer. This comes after the majority of companies who participated in a recent four-day work week trial chose to continue with the working pattern. A spokesperson for Sainsbury’s said: “We are always looking to evolve our ways of working to ensure we can do the best possible job for customers while continuing to be a brilliant place to work for our colleagues. We are currently testing new ways to be more efficient and offer improved flexibility.” This comes after the supermarket retailer announced an £185m investment into its wage bill for employees.

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M&S announces directorate change

The former head of the global consumer team at private equity firm Permira is set to join the board at Marks & Spencer. Cheryl Potter will join the retailer as a non-executive director, effective from March 1st. In her 20-year career at Permira, Potter worked as an investor and steward of portfolio companies, while also serving on various boards of retail and consumer-facing brands including Dr Martens, Allegro, Homebase and Birds Eye. Potter is also a founding patron of The Prince’s Trust Women Supporting Women Scheme as well as the current chair of Level 20, an organisation which aims to place more women into senior investing roles in the private equity industry. Archie Norman, chairman of M&S, said: “I am delighted that a superstar of the private equity world is joining us at M&S. She brings enormous energy, passion and a strong shareholder value focus to the Board, as well as a great track record as a role model and advocate of women in leadership”.

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Consent granted for Farnborough regeneration scheme

A major mixed-use regeneration project in Farnborough has been given the go-ahead by local councillors. The Rushmoor Development Partnership, a joint venture between Rushmoor Borough Council and Hill Investment Partnerships, looks to regenerate town centre sites in Hampshire’s Farnborough and Aldershot. The proposed plans for Farnborough’s ‘Civic Quarter’ would see the development of new retail, food and beverage, and commercial space, the construction of a leisure centre and civic hub, and the creation of around 1,000 new homes. The Rushmoor development partnership was started in 2018 and undertook a series of public consultations in 2019 and 2021. Andy Hill, group chief executive of the Hill Group, said: “Our plans for Farnborough’s town centre will provide much needed, sustainable new homes and fantastic amenities that will be enjoyed by the residents of Farnborough now and in the future. The RDP is committed to delivering a legacy of high-quality, sustainable development that will benefit the community for generations to come.” In 2020, the partnership was granted planning approval to transform parts of Aldershot’s town centre, creating 2,200 sq ft of retail, commercial, and public space, as well as new homes and student accommodation.

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Consumer confidence bounces back amid retailer pessimism