The retail sector looks to be shrugging off High Street challenges with demand for new UK stores rising latest figures show, as a host of London-listed companies outlined plans to expand their bricks and mortar estate in 2024.
Chief executives of a number of FTSE 100 and FTSE 250 firms, that sell goods ranging from clothes to homeware and sausage rolls, are among those that told the Evening Standard they collectively plan to open in the region of more than 200 sites this year or in their financial year.
That will be welcomed by town centres and landlords after tough conditions in the sector, from the cost of living crisis to higher business rates on the way for some large chains.
Despite industry headwinds, latest research from estate agent Savills, analysing figures from database The Requirement List which tracks commercial property demand, shows greater appetite for High Street sites.
The firm said total demand in 2023 was up 5.5% from the prior year, which was also 3% higher year on year.
Alan Spencer, head of UK retail at Savills said: "With the rebasing of rents across most retail locations making physical space more affordable, we have seen an uptick in retail brands adjusting their focus from online to the high street."
Discount retailer B&M is aiming to open at least 45 UK stores in each of the next two financial years, according to chief executive Alex Russo. He added: "From a little over 700 UK stores currently, we plan to open at least 1200 stores over the longer term."
Homeware retailer Dunelm's boss Nick Wilkinson is looking at 5-10 openings in 2024.
He said: "We continue to see strong returns from stores and are becoming more confident in a variety of formats and sizes as we increase our footprint across the UK.”
Michael Murray, who leads Sports Direct and Flannels owner Frasers Group, anticipates in the year to April 2024 the retailer will broadly have matched the 100 new stores and refurbishments done in the prior 12 months.
We remain committed to physical retail, and we look forward to investing in more innovative store concepts in 2024 and beyond
The CEO added: “Due to the increasing costs associated with business rates, national minimum wage, and property developments, it’s important we co-invest with landlords. However, we remain committed to physical retail, and we look forward to investing in more innovative store concepts in 2024 and beyond.”
Primark, owned by Associated British Foods, which is doubling the size of its Westfield Stratford branch, will open at least three more sites as well as "refresh" a raft of its existing stores.
Kari Rodgers, the clothing chain's UK retail director said: “As we enter an exciting year for Primark, celebrating 50 years on the great British High Street, a lot has changed, but our commitment to bricks-and-mortar retail has never wavered."
Rodgers added that "people’s expectations have never been higher of the in-store experience, and we continue to work to create stores that people want to visit and spend time in".
Meanwhile Greggs plans to open between 140 and 160 net new shops in the UK in 2024. Chief executive Roisin Currie said: "We believe there is an attractive opportunity to open across more locations such as rail and bus stations, travel locations, petrol forecourts and drive thrus."
In the supermarket sector Marks & Spencer's Stuart Machin did not give planned opening numbers. But he told the Evening Standard: “Stores are where the M&S magic really happens which is why I’ve put them at the centre of our plan to reshape the business. And it’s working. Our bigger, better stores are winning more customers and growing bigger baskets. So, this year we’ll go further and faster to bring the experience to even more customers.”
At Sainsbury's, property director Patrick Dunne said the grocer believes there are still lots of opportunities "for us to bring our passion for high quality, great value food to more communities and neighbourhoods throughout the UK in the form of new Sainsbury’s stores".
Dunne added: "We’re very targeted in our approach to new space with a focus on providing an excellent offer in the right locations, carefully selected to ensure we are meeting the needs of local customers every time."
