28 October 2019/ rent_retail_guide

How many square feet is an average retail store?

The UK’s retail industry is one of the UK’s largest in terms of size and value, generating 5% of its total GDP and employing around 9% of the nation’s workforce. Figures from 2018 show that there are 319,000 retail businesses operating in the UK, though it’s estimated that around 50,578 of the country’s retail units are lying vacant, showing that there’s plenty of retail space just waiting for fledgling businesses to snap up.

Here, we take a look at the average size of the UK’s retail properties and how much they’re likely to set you back if you’re looking to rent one.

Which kinds of properties can be used for retail?

Firstly, it’s important to understand the property types that you should be looking at if you’re seeking a home for your retail business. Category A properties have permission to be used by a range of retail businesses. There are five subcategories, with the first two primarily used by retailers.

  • A1 – used by companies selling goods, including clothing/food shops, showrooms and travel agencies and those providing a service, like dry cleaners and hairdressers.
  • A2 – solely for ‘financial and professional services’ companies, including banks, estate and employment agents, accountants and legal firms.

There are also three subcategories that fall into the leisure category but could also be used by some kinds of retail businesses.

  • A3 – restaurants, pubs, snack bars and cafés (or any other business which sells hot food and drinks to be consumed primarily on the premises).
  • A4 – drinking establishments.
  • A5 – hot food takeaways e.g. fish and chips shops, pizza chains.

How large is the average retail property?

It’s tricky to get a picture of the ‘average’ retail property, as their sizes vary so much depending on the kind of tenant they’re intending to attract as well as the amount of space available to developers.

Convenience stores need little space, with more than 60% occupying stores under 1000 square feet. Some malls and city centre retail areas will have ‘kiosk’ units to rent that can be as small as 100 square feet, but these are best suited to pop up shops or small food establishments. Comparatively, supermarkets typically occupy units of between 20,000 – 60,000 square feet, with some out-of-town superstores occupying as much as 100,000 square feet of retail space.

Most other retail businesses will fall somewhere in between, with boutiques, small sandwich stores and small professional offices close to the lower end, while popular clothing and beauty retailers and discount stores are likely to occupy large spaces.

High street and inner-city locations will generally have a smaller amount of space available to retailers, unless there’s a purpose built retail area or ‘mall’ development offering space for flagship locations. Out of town retail parks are home to the largest units.

Retail trends

The price of retail units has continued to increase over the years, despite growing numbers of empty units on many high streets and in previously popular out of town retail parks.

Area

2016 (price of large units psf)

2018 (price of large units psf)

2016 (price of small units psf)

2018 (price of small units psf)

London

£650

£700

£450

£482

UK South

£603

£636

£420

£443

UK Central

£556

£604

£385

£413

UK North

£558

£576

£390

£410

Northern Ireland

£510

£523

£340

£353

Scotland

£550

£583

£367

£383

 

Retail store size trends

According to property consultancy firm Strutt and Parker, the kinds of retail stores tenants are choosing has changed a lot over the last few decades. Huge one-stop-shop superstores in out of town retail parks used to be popular among supermarkets and other retailers, occupying up to 100,000 square feet.

However, they have become outdated as shopping habits have changed, with many of us moving online or choosing to shop for our groceries ‘little and often’ in convenience stores close to our workplaces. Goldman Sachs now predicts that sales from these colossal stores will have fallen 18% by 2020.

Grocery retailers have recognised this and are now choosing to occupy units between 1,500 square feet and 20,000 square feet in prime central locations. Developers that do have large stores over 40,000 square feet in the pipeline are now planning how they can better use the space, choosing to break it into two smaller stores in many cases.

Coffee shops are also changing, choosing both smaller or larger units to cater to a diverse audience seeking both places to meet and quick drive-through caffeine fixes.

Traditional shop retail stores have also increased in size by 34% between 2008 and 2014, despite their average floor space growing by just 13%. Many in the industry believe this is due to an increase in the storage space businesses require from click and collect services.

If you’re looking for a home for your new retail business or need another location to help you branch out, we’ve got plenty of exciting retail space right here. Browse our selection and find your ideal property, wherever you are in the UK.