North East Retail Market Overview Autumn 2008

Published: September 2008
Source/Company: Colliers CRE

Abstract:
Executive Summary
• Between May 2007 and May 2008, prime in-town retail rents in the North East rose,
on average, by 2.1% – a weaker performance than last year’s increase of 2.6% but well
above the UK average of 1.1%. This places the region fourth in the regional ranking
for 2007/08.
• In terms of real rental growth, however, the region experienced a rental fall of -2.1%
over the 12 months to May 2008, although this is better than the UK average of -3.1%.
• During the 12 months to May 2008, prime rents increased at 30% of centres in the
North East, the same percentage as last year. No centres experienced a fall in
prime rent.
• The MetroCentre remained the most expensive rental location in the region at
£340 psf Zone A, up from £335 psf in 2006/07. However, Consett and Cramlington
achieved the highest annual growth of 14.3% with prime rents rising from £35 psf to
£40 psf in the former centre and from £70 psf to £80 psf in the latter.
• As at May 2008, the shopping centre development pipeline for the North East to 2013
stood at 1.5 million sq ft – 43% of which was under construction, 25% had planning
consent and 32% was at proposal stage.
• In the out-of-town retail market, Stockton-on-Tees achieved the top rent of £58.00 psf
at Teeside Retail Park. However, Newcastle upon Tyne saw the highest annual rental
growth of 30.8% at Silverlink, rising to £42.50 psf in May 2008.