Lock-up shops are becoming increasingly popular options with buyers looking to move into the independent retail sector, according to Independent Retail News.
The difficult residential housing market has forced more prospective retailers to change their purchasing approach over the last 12 months and so increase the demand for lock-up units, according to new research from commercial property agent and advisor Christie + Co.
Christie + Co director Allen Shepherd told Independent Retail News: “A lot of people are realising they cannot get value for money for their domestic property or that they cannot sell it in a timely fashion so they cannot pursue the traditional financing route.
“Historically, people have sold their home and moved in above a shop, but that is not always possible any more,” said Shepherd. “Instead, they use equity released on their home to free up some cash and then may choose a lock-up, which is obviously a cheaper option in terms of rent.
“Some people also want to be separate from their business,” he said. “They like to go to work and close the door to go home afterwards and that is why a lock-up appeals.”
Shepherd said a leasehold agreement on a lock-up shop usually lasted several years, with some short-term lets often used by landlords to fill a void.
Independent retailer Ralph Patel is concerned about the impact short-term leases have on the high street.
“A lot of these lock-up units seem to be open for a while and then just disappear almost overnight. It is often a short-term thing that obviously takes business away from genuine retailers who have huge overheads.
“If you are trading on the high street, you will be paying the going rate for rent but then a new arrival will come in paying a peppercorn rent.”
Patel, who runs an independent newsagents in Woodmansterne, near Banstead, Surrey, added: “It is often genuine businesses that have closed down because of the recession but have re-opened because in this economic climate landlords don’t want to sit on empty property. It doesn’t bring any stability to the high street.”
Patel, who is branch secretary of Croydon National Federation of Retail Newsagents, said he had noticed a growth in lock-up shop activity particularly in areas such as Croydon, Thornton Heath and Wallington.
