Real Estate Investment:Today

London’s West End set for ‘uninterrupted’ growth, says Shaftesbury

London’s West End has continued to recover despite the emergence of the Omicron coronavirus variant and is set for an extended period of uninterrupted trading, according to a bullish forecast from landlord Shaftesbury.

The vacancy rate on the company’s 16-acre estate, which covers Chinatown, Carnaby Street and Seven Dials, has fallen below 5 per cent for the first time during the pandemic and close to 90 per cent of tenants have paid their rent for the period to December 31, an improvement on previous coronavirus-affected periods.

“This idea that everyone would flee the city centre, that hasn’t come to pass. There are no flats to let. Shops are finding that the costs of being online — paying for deliveries and a website — are going through the roof. Some are deciding they would rather have a busy store on Carnaby Street,” said chief executive Brian Bickell.

Popular with tourists, theatregoers and shoppers, the central London neighbourhood has endured a number of bruising periods during the pandemic, with coronavirus restrictions keeping visitors at home and local businesses struggling to make rent payments.

The emergence of Omicron ahead of the Christmas trading period thinned the crowds who might otherwise have visited but, unlike other strains of the virus, did not completely stifle the West End’s rebound, Shaftesbury said in a trading update on Friday.

“Whilst trading and footfall have been impacted by seven weeks of Omicron restrictions, strong trading prior to the restrictions and the continuation of government support measures have enabled our occupiers to weather this period of disruption,” said Bickell.

“Together with an improving outlook for international leisure and business travel, there is now the prospect of an extended period of uninterrupted trading growth,” he added.

During the first coronavirus lockdown in 2020, the West End fell silent. As many as 180 of the 630 flats on Shaftesbury’s estate were vacated, some by people who fled the country and left their possessions behind, according to Bickell. Empty shop fronts began pockmarking the estate as businesses folded despite government support. 

Shaftesbury’s share price fell 50 per cent from February to November 2020, but has since made a partial recovery on the back of a gradual improvement in the West End.

On the last weekend of January this year visitor numbers were higher than at the same time in 2019, said Bickell.

John Cahill, an analyst at Stifel, said a return of international tourists later this year and continued demand from businesses to let space was likely to reverse some of the rental discounts which Shaftesbury introduced to attract tenants back during the pandemic. 

Related Articles

Leave a Reply

Your email address will not be published.

Back to top button