Although there has been some improvement in economic performance in recent months, retail sales figures to the end of September continued to deteriorate and the prospect of another austerity Budget next month has given consumers grounds for ongoing caution.
Despite this however, there is still pent-up demand amongst retailers for prime retail premises with a considerable volume of letting activity occuring as tenants continue to take advantage of the ability to negotiate attractive deals with landlords in the current climate.
French retailer L’Occitane and UK fashion retailer Vila are to open new stores at Liffey Valley shopping centre in West Dublin, where Tommy Hilfiger has just relocated to a larger store. There are plans to extend the restaurant area in this shopping centre and a new cinema foyer and 3D cinema facility is also planned.
Inglot have recently opened a new store at Blanchardstown Town Centre. Meanwhile, jewellers Pandora are to open a new store at Dundrum Shopping Centre, where Carraig Donn have recently commenced trading. It is also worth noting that some of the recent rent review arbitration awards at Dundrum showed rental uplifts of between 5% and 20%, which are more modest than the intitial artibration awards reported in this centre.
Carraig Donn have also recently opened a new store at Dun Laoghaire Shopping Centre, which is now anchored by Super Valu.
A new wave of discount retailers are now getting traction with Dealz stores in Blanchardstown and Portlaoise and a new Euro 50 store at the ILAC Centre trading very well and Irish competitor Euro 2 shortly to open on St Stephen’s Green in the former Eircom store. A third Dealz store is to open in the former Zavvi unit on Patrick Street in Cork.
The Swedish furniture chain Soul of Furninova are to open their first Irish store at Beacon South Quarter in south Dublin later this month while the Italian childrenswear operator Petit have recently opened their first Irish store on Exchequer Street in Dublin city centre.
Smyth’s Toys will shortly open a new store at Letterkenny Retail Park while Iceland are to open a new store at the Clonmel Showgrounds shopping centre later this month.
Boots have announced plans to open 30 new stores in Ireland and have recently opened a new store at Lower Baggot Street in Dublin while Holland & Barrett are to open their 41st Irish store on Henry Street in Dublin city centre.
Meanwhile, Kilkenny Design have opened a new store at Stilloran Shopping Centre in south Dublin where Donnybrook Fair recently started trading. Aldi are continuing aggressive expansion and are currently awaiting planning decisions in a number of locations.
According to CBRE research, quoting rents for prime retail properties now appear to be stabilising at current levels, having experienced declines of more than 50% from peak.
Established retailers paying legacy rents under upward only leases are anxiously awaiting the publication of the long-promised draft legislation on rent review reform, which will enable some tenants to seek rent reductions from their landlords in order to enhance the profitability of their businesses.
An increasing number of landlords and their lenders are continuing to adopt a pragmatic view as is evidenced by the number of surrenders and relettings that have recently been agreed on many of the former Halifax retail premises around the country.
It is clear that notwithstanding the fact that retail sales numbers remain under pressure, many retailers are taking advantage of the favourable terms currently available in the market and the relative value is increasingly being recognised by international retailers.