According to the annual Global Property Development Trends report, a second wave of COVID-19 could leave Britain’s high streets in major distress and close up to 12 million square meters of retail space.
Several months into the pandemic, many retail fronts have already been forced to close their businesses, which has led landlords to search for alternative tenants.
“Longstanding pressures faced by property owners and developers through declining retail rents and failures have now been exacerbated by the pandemic and its evolving impacts,” said Scott Morey, executive director at Altus Group. “However, the property industry is recognising opportunities that exist and will seek to repurpose assets during this period of uncertainty and well into the recovery stage.”
The report also revealed that non-food retailers were hit hardest by the pandemic, having lost up to £9 billion in sales this year.
Specifically, commercial offices are some of the most high-risk properties particularly as the UK government urges people to continue working from home. Even more, IWG is threatening to cut £790 million in lease agreements unless landlords decrease their rents.