Robust Growth in UK Shopping Centers

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Shopping center development in the U.K. during the first eight months of the year was more than six times higher than last year, with the total for 2013 expected to reach a four-year high, according to real estate firm Cushman & Wakefield. 

So far in 2013, 238,800 square meters of new shopping center space were added to the market, compared to 37,000 square meters last year, the lowest recorded level of development since 1962, the firm reports. 

The total shopping center floor space in the U.K. is 16.8 million square meters across 710 projects. Projects currently in the pipeline are expected to add another 62,700 square meters of gross leasable area to the market by the end of year. If all projects are completed, the total for 2013 would be 301,500 square meters, the highest level since 2009.

"Notwithstanding the strong rebound witnessed this year, the development pipeline remains limited as occupiers and investors try to adjust to changing consumer behavior and wait for a lasting economic improvement," Martin Mahmuti, senior research analyst in Cushman & Wakefield's European Research Group, said in the report. "However, with this now looking to be underway, development intent is set to grow."

Eight new shopping centers were added during the first eight months, the most notable being Trinity Leeds with 75,900 square meters, the firm reports. Other projects include West Bromwich's New Square, which opened in July and the redevelopment of the Whiteley Village Outlet in Fareham into the new Whiteley Shopping Center. By this time last year only one project had been completed in the U.K.

Out of all shopping center space added this year, more than 91 percent were new centers, the remaining space -- 21,900 square meters -- was through seven extensions. 

Looking ahead to 2014, the firm expects a drop in new shopping center development.

"Although shopping center development activity will slow down next year, 171,800 square meters of new space will be added to the market in 2013-2014, which is a good base to build on and will only increase if economic conditions continue to improve," Cushman & Wakefield retail development partner Alistair Parker said in the release. "Leasing activity will remain strongest in the regionally dominant shopping centers, with occupiers targeting larger, well-configured units."