Retail Property: An Essential Part of a Country’s Built Environment

renewal centres, which are built within existing central areas, as noted by Dawson (1983). Out-of-town, free-standing, regional shopping centres are the primary concentration, as they have caused much concern and controversy and have not yet succeeded significantly in the UK compared to other countries like Australia, South Africa, and America. Regional shopping centres are planned centres that serve a 'regional' function rather than district, neighborhood, or local purposes, as defined by Bennison and Davies (1980).

According to Guy (1994, 1996), regional shopping centres are typically fully enclosed spaces that exceed 400,000 ft2. They are often situated in off-centre locations, although some earlier examples were situated in town centres and served as the hub of commercial activity in government-funded new towns. These centres are spacious enough to accommodate at least one department store and around fifty smaller shops. Significantly, a considerable portion of the floor area is typically reserved for leisure amenities such as cinemas, bowling alleys, or ice rinks. Notably, the earliest regional shopping centres in the UK were embedded in town centres.

During the late 1980s, regional shopping centers started expanding beyond town centers such as Manchester's Arndale Centre and Newcastle's Eldon Square. This shift occurred because financial investors favored town centers while land use planning control remained strong.

During the 1980s, regional shopping centers experienced significant growth, including the Metro Centre in Gateshead, Merry Hill in Dudley, and Meadowhall in Sheffield. This growth is explored in this section, with a focus on its initial impetus and the prediction by commentators such as Jones (1989) and Dawson (1983) of further growth in the following decade.

Schiller's 1986 proposal of 'waves of decentralisation' reinforced the belief that

retailing was decentralising and that Britain was experiencing a 'third wave' of decentralisation. The early 1980s saw a deregulatory stance that created a favorable environment for regional shopping center development, according to Schiller (1986). Prior to the early 1980s, only a few regional shopping centers were constructed outside established shopping locations in the UK, while some were built within central shopping areas of towns and cities as developers and retailers prioritized superstores and retail warehouses (Neafcy, 1984). However, in the mid-1980s, there was a surge in proposals for new regional shopping centers that threatened established town centers. Despite this, much of the planning favored development and generating employment while promoting competition among retailers.

During this time period, developers presented ideas for enclosed shopping centers, taking advantage of the lack of influence from planning policies. Nicholas Ridley, the Secretary for the Environment at the time, acknowledged the power of the out-of-town shopping movement, stating that it was too big of a force for him to stop or to be stopped.

In 1987, the government's powers were deemed insufficient to prevent the proliferation of out-of-town regional shopping centers, according to The Times. As a result, there were 43 such proposals that year. Between 1982 and 1991, a total of fifty proposals for shopping developments larger than 500,000ft2 were made, as reported by BDP Planning in 1992.

During the late 1980's and early 1990's, an increase in proposals for regional shopping centres led to a reevaluation of their potential risks and negative impacts. Despite this, the period was ideal for regional shopping centre development, as evidenced by the construction of four super-regional centres: Metro Centre, Meadowhall, Merry Hill, and Lakeside.

In

the late 1980s, the Department of Environment's issuance of PPG 6 focused on protecting greenbelts and open countryside around urban centers and prohibited negative impacts on town centers. This greatly reduced the possibility of regional shopping center development, which was expected to thrive. Several reasons, including this factor, contributed to the underwhelming growth of regional shopping centers. Despite more than 30 out-of-town shopping centers being planned a little over a decade ago, strict planning regulations and guidelines have led to a reversal of this policy. As described by the Financial Times in April 2002, suburban retail malls were formerly seen as the ultimate symbol of prosperity.

Developing countries still welcome regional shopping centres, but in economically advanced nations, attitudes have shifted due to increased awareness of the negative impacts on traffic and city centres. This section will analyze the influence of Planning Policy Guidance 6 (PPG6) and planning guidelines on regional shopping centre development in the UK, as well as examine other economic, social, and environmental factors that hindered the anticipated "boom" in regional shopping centres. Despite predictions of widespread growth in regional shopping centres, by 1999, there were only eleven in the UK. In the late 1980s, the Oxford Institute of Retail Management identified forty potential regional-scale shopping centres, but only a few of these proposals were actually put into motion due to changing government policies in the 1990s outlined in PPG6 (Wrigley, 1998).

The 'third wave' of retail decentralisation in Britain has come to an end, as only four of six newly built regional shopping centres were permitted before changes to planning policy guidelines. These changes, particularly PPG6 in 1988, dramatically affected out-of-town regional shopping

centres and curtailed their rise. PPG6 policy was revised in 1993 and 1996, emphasizing the need for renewed investment in town centres to enable them to play a more central role in the community's vibrant life (Davies, 1996).

Retail planning has shifted towards revitalizing traditional town and city centers, as noted in the revised Planning Policy Guidance 6 (PPG6) in 1996. The PPG6 states that regional out-of-town shopping centers should only be permitted if they serve a significant retail need and consider all potential impacts. However, Lowe (1998) posits that PPG6 regulations intended for out-of-town retailing are not necessarily suitable for regional shopping centers. Langley (1996) acknowledges this ambiguity, stating that regional shopping centers fall into a gray area within PPG6, particularly regarding whether a distinction should be made between out-of-town shopping developments in built-up areas versus those built on greenfield sites outside of urban areas.

Despite the absence of specific policies, PPG6 is guided by a fundamental philosophy which aims to optimize current facilities and transport systems to protect existing centers, preserve the countryside, and prevent encroachment onto greenbelt land. Consequently, several proposed regional shopping centers do not align with this philosophy of PPG6.
It is challenging to imagine how any regional shopping center proposals could conform to the government's sustainable development policies and its objective to enhance the vitality and viability of town centers. Thus, Braehead Riverside Shopping Centre in Glasgow is estimated to be the last regional shopping center constructed in Britain (England, 2000). However, according to Guy (1994), differences in retail provision volume and location between the United States and Britain are not solely influenced by planning control.

Retail developments in the

US are often characterized by numerous low-priced and speculative projects constructed on inexpensive land by local and regional development firms operating in favorable planning circumstances. This allows developers to take significant risks as failed shopping centers can be repurposed. Conversely, retail development in Britain is typically expensive due to high land acquisition costs and is primarily funded by large financial or development organizations operating in a heavily regulated planning environment. As a result, the majority of projects will only proceed if there is extensive evidence of an acceptable return on investment for investors.

This indicates that planning regulation is strongly linked to the expenses of land and the perceived level of risk. Additionally, the status of the land market during the 1990s hindered the expansion of regional shopping centers as there were few suitable sites that did not contradict planning policy regulations. The enterprise zones were nearly at capacity and competition for sites in the current cutthroat retail industry has driven prices up to unreasonably high levels, ultimately diminishing the potential profits of a shopping center.

Given retailers' indifference and investors' caution, only schemes that offer excellent ROI are likely to attract interest. Financial concerns also loom over regional shopping centers as property investments due to several long-term doubts. One issue relates to the phasing out of the exemption from payment of business rates, which will ultimately increase the costs for retailers. Additionally, regional centers are so large and valuable that few institutions are willing to buy them from developers; for instance, the Lakeside Centre in London was valued at over £300 million in 1992, making it an unattractive proposition for many institutions (Thompson and Wythe, 1988).

Financial

institutions are reluctant to invest in non-food, out-of-town sites as they have significant amounts of capital invested in central shopping schemes and retail parks that they need to safeguard. Additionally, shopping centres are considered less reputable by financial institutions and national property companies. Therefore, many prefer purchasing completed centres rather than starting development themselves (Guy, 1994). These economic concerns were also influenced by the effects of the early 1990's recession.

Due to the effects of the recession and property slump, the development process of many schemes has slowed down considerably. As a result, apart from food retailing, significant changes to the retail environment are not expected in the near future. These schemes are still 'in the pipeline' and awaiting realisation. According to Davies (1994), this delay has been a setback.

From a societal viewpoint, Guy (1996) notes that consumers have an emotional attachment to town centres and are nostalgic about them. In addition to being places for retail, many town centres in the British retail environment also serve a social function.

Many retailers and consumers consider traditional high streets an important part of their retail "heritage" and prefer them over off-centre schemes. This sentiment often leads to widespread public disapproval of proposals for regional centres, which can hinder the planning process under the UK's planning system. Despite this, Howard (1992) argues that regional centres do not necessarily take trade away from nearby town centres. In fact, many traders who lease space in regional centres also maintain a presence in traditional high streets. A 2001 survey by Colliers CRE found that retailers still have faith in their high street stores and support them.

A survey was conducted

on 40 shops located in both Oxford Street and Bluewater Shopping Centre in Kent. The results showed that over 60% of these shops expected an improvement in their trade and profits in Oxford Street by 2002. Conversely, less than 10% anticipated a decline. Interestingly, the study also revealed that more than 75% of these shops still considered their flagship store to be situated in Oxford Street. These findings demonstrate that traditional high streets and city centres remain popular among both retailers and consumers. With proper planning and careful locational strategies, developers and planners can potentially strive for a more balanced approach between out-of-town shopping centres while maintaining the vibrancy of the city centre. In addition, improvements in town centres have reduced the immediate need for more pleasant and attractive shopping environments.

Revitalization efforts have been focused on shopping precincts in Watford and Bromley. With centers like West Quay located in the center of Southampton, shoppers can enjoy both high street shopping and an enclosed shopping area without having to leave town. These developments have been successful, leading to a decrease in planning permission granted to out-of-town proposals. However, the increase in impact assessment studies has resulted in negative press and criticism of regional shopping centers, as they tend to highlight their negative effects on existing retail hierarchies. As a result, virtually every large regional shopping center built in the UK has been subject to an impact assessment study (Loxton, 1995).

Frequently, impact assessments are conducted a few years after a development has been constructed in order to evaluate its economic, social, and environmental effects. One such assessment is the OXIRM (1994) study which analyzed the

influence of the Meadowhall shopping center on Sheffield CBD. The research indicated that Sheffield's non-food shopping trips declined by 38%, causing the city to lose more market share than previously presumed. According to OXIRM, Meadowhall was a significant factor in Sheffield's further decline from 1990 to 1994. Since Meadowhall's opening in 1990, city center trade has decreased by over a third.

According to the Oxford Institute (1992), studies show that trade diversion and shopping behavior polarization are seriously affecting existing town centres. However, these subjective studies must be carefully considered when presented at appeals or public inquiries as they can be manipulated to serve the interests of certain parties due to a lack of standardization in methodology. Nonetheless, if used correctly, these studies can provide valuable information on impacts on town centres, public opinion and statistics on pedestrian flows and expenditure.

A more recent concern is the need to reduce private car travel to conserve energy and mitigate global warming.

The DoE released a statement in 1990 expressing concerns about the development of out-of-town shopping centres. Three years later, PPG6 reiterated these concerns and gave stronger support to retail development in central city areas that relied less on car travel. In contrast, off-centre developments like regional shopping centres that relied heavily on mobile shoppers received weaker support. PPG13 has further increased attention on this issue at a political level.
As a result, regional shopping centres have faced several obstacles to development in the UK that were not present in North America. One obstacle was related to the land market, as suitable undeveloped sites of up to 50 hectares that were accessible to large

catchment populations were difficult to find.

Shopping centre developers had to pay extremely high prices for suburban land due to competition for sites. Financial institutions were also hesitant to invest in out-of-town retailing as they wanted to safeguard their interests in central retail areas. Planning and environmental concerns as well as fears of negative impact on existing shopping areas posed further obstacles to the development of regional shopping centres. Therefore, established city centres were often preferred for shopping expansion while development in out-of-town locations was limited.

The approval of local plans in the planning system has elevated their status, making it difficult for regional centres to succeed on appeal if they oppose local planning policies. While it was previously believed that developing shopping centres in Urban Development Corporations would be easier due to their lenient approach toward retail schemes, the limited number of these corporations (only twelve in England and Wales) means that there are few opportunities for regional centres in most areas. Therefore, the significance of institutions, such as planning policies, is apparent.

The British retail sector has been significantly impacted by financial and governmental factors, as well as societal interests and economic concerns about the land market and recession in the 1990s. As a result, the anticipated rise in regional shopping centers did not materialize.