Friday 14 August 2020

The Netherlands had too many shops even before corona, says new research


Brick and mortar shops were being replaced by online shopping even before the coronavirus epidemic began, new research shows. Thanks to this trend, on top of coronavirus protection measures, experts predict that shop vacancies rates could rise by nearly 20%.

The research, undertaken via the ministry of economic affairs, finds that consumers are shopping less in person and more online in general. Its ‘retail agenda’ research group surveyed consumers, shop owners, landlords and local governments for its latest report.

Since the pandemic began, it found consumers are shopping in stores 30% less often, visiting stores in their home towns 20% less frequently and spending 39% less time in shops in other municipalities.

The intelligent lockdown has had a huge impact on retail, the report said. Stores reported on average a 35% drop in visitors between March and June. Visits were down by much as 80% in some shopping districts.

Meanwhile, the government estimates that between 35 to 80% fewer new shops opened so far this year than in a normal year. The report expects that some 20% to 40% of existing non-food shops will disappear within two years.

All of this will lead to an increase in vacancies, especially in city centres, the report finds. Almost all property owners (94%) expect that city centres will be hit hardest by the consequences of the corona crisis and that 15% of existing shops will disappear in the next 12 months alone. They also predict a drop in rents, probably of around a sixth.

This trend, according to experts, started long before corona. Shopping traffic was already down 30% from the previous decade as online shopping rose. However, more than twice as many consumers now say that they prefer to buy online than did before the crisis began.

‘Commercial buildings can be converted into something else, especially in approaching streets leading to the city centres,’ Hub Bloem of consulting company Stec Group reportedly told Trouw. But, he added, landlords are hesitant to turn over commercial space because the alternatives are not as profitable.

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