When we look at a snapshot of what is happening in the property world at the moment, we can see the high levels of demand for premises from startup operators, independents, growing brands and Internationals looking to break into the UK market with a distinct lack of supply! This has been the case since last November. BUT we can see the light at the end of the tunnel and in my view, we are about to enter the most exciting time for operators within the market who are looking for premises.
We have seen a successful opening for restaurants with outside space and come 17th May, we will see what I hope to be greater success in the opening of all restaurants to allow inside dining. All being well, 21st June is marked as freedom day, when all restrictions will be dropped. By this date the Government should have made the announcement of how the current moratorium in place to protect tenants from non payment of rent will be released. At this point landlords and tenants will be forced to come to an arrangement, which will inevitably see property becoming available via Landlords and/or via tenants.
The effects of the pandemic has caused premium values to considerably drop. It is possible that you may see a drop in rents as well due to landlords having had to take back premises. We can expect to see a transition in the market that will allow all of the aforementioned operators to enter the market and bring a whole new dining scene to the capital across the UK.
Maybe it was a time for a correction in the leisure property market as rents were soaring and premiums were reaching heights that were becoming unattainable for businesses to really make a profit. The next few months will certainly prove that correction in the market and whilst it is sad that there will be many operators who may lose their premises over the coming months, it is an opportunity for them and others to start a fresh with lower than previous entry cost. London and the UK will prove to continue to be one of the world’s leading countries for food and beverage.