One industry which appears to be weathering the recession is the supermarket industry. In modern day life, rightly or wrongly, the supermarket has become a necessity rather than a luxury.
Supermarket chains across the UK have come in for an increasing amount of criticism recently, amid reports of increasing food prices during the recession and the growing profits of companies such as Tesco’s and Sainsbury’s.
However, one sector that will not be found condemning these supermarket chains is the commercial property industry.
A headline in The Financial Times, last week, read, ‘Supermarkets Offer Lifeline’, this was directed towards the commercial property industry, with the article stating: ‘The number of planning approvals granted for large-scale retail developments jumped to 217 in the last three months of 2010, a 36 per cent rise on the same period a year earlier, according to research published on Monday.’
It is hoped that this rise in retail planning approvals can be the catalyst for a commercial property boom.
Whilst other sectors of the commercial property industry, such as the office and industrial sectors, have been struggling since the recession hit, the retail sector and supermarkets in particular, have been a major aid to commercial property construction companies. Out of town retail sites are an area of the commercial property market that have survived the economic problems well.
Giles Ferrin of law firm EMW , stated: ‘The traditional high street retail sector has been moribund for a while now, so big out-of-town sites have become a larger part of retail construction.’
It is believed that Tesco and Sainsbury’s are the two companies which are driving this commercial property growth, with Tesco opening 208 new stores in 2010. Yet Tesco and Sainsbury’s are not alone, Morrisons is currently trialing the development of connivance outlets and Waitrose are also opening a number of new supermarkets.
Whilst many may not like the dominance of large chain supermarkets, they are serving a purpose within the commercial property industry.
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