A study by property consultancy Knight Frank found that Edinburgh had the most productive retail space of any major UK city outside of London, with the Scottish capital achieving a “sales density” of £665 per square foot, prior to last year’s opening of the vast £1 billion St James Quarter development.
Glasgow was close behind, with a figure of £611 per sq ft, against an average of £329 per sq ft across the 39 UK locations analysed.
A higher sales density figure indicates strong levels of productivity, while a low number suggests under-performance and/or an oversupply of retail space, the firm said.
Edinburgh and Glasgow also performed well on other key measures assessing the health of retail destinations.
Glasgow city centre has seen retail rents re-base just -1.9 per cent over the last ten years, while Edinburgh was -12.5 per cent against a UK cities’ average of -35.2 per cent. Last year, the vacancy rates in both cities were also below the UK cities’ average of 20.3 per cent, at 13 per cent for Edinburgh and 18.7 per cent for Glasgow.
Experts said the findings suggest that, although the pandemic has resulted in fundamental changes to the way people shop, Edinburgh and Glasgow’s retail offerings have proven “resilient” and the two cities look set to remain among the UK’s top shopping destinations.
The research comes amid major redevelopment plans for Edinburgh’s iconic Jenners department store and a long-term vision for Glasgow’s Buchanan Galleries.
Alasdair Steele, head of Scotland commercial at Knight Frank, said: “There has been a lot of talk about retail re-purposing, but the level of activity has thus far been fairly limited. It can be a complicated and costly process and often the numbers do not stack up from an investor’s perspective.
“The launch of the St James Quarter in Edinburgh will undoubtedly have an effect on other retail pitches in the city - with the data capturing that still to come through. However, as the plans at Jenners demonstrate, there are opportunities to convert retail space that may be surplus to requirements and some of this could be used to address Edinburgh’s perennial lack of new office space under development.”
Stephen Springham, head of retail research at Knight Frank, added: “The proposed plans for Edinburgh’s Jenners department store and Buchanan Galleries are two of the highest profile examples of retail space being re-purposed in city centres in the UK.
“Yet, perhaps ironically, they are two of the least over-supplied city centre markets. The devil in the detail is that, in Scotland, our research suggests it is out-of-town where retail space is most over-supplied, rather than in city centres, and this is where change of use is most likely to follow.
“The question is whether this out-of-town floorspace is viable for alternative use,” he added.
Recent proposals to demolish Buchanan Galleries to create a mixed-use development have divided public opinion.