The retail recovery is under way, says Edward Ziff of Town Centre Securities

Edward Ziff, OBE DL, the chairman and CEO, of Leeds-based Town Centre Securities PLC (TCS) said the widespread vaccination programme, combined with pent-up demand had triggered significant improvements in consumer sentiment.

TCS, which is a property investment and car park management firm, has built up a wide ranging portfolio over the last 60 years, which includes a number of significant sites in Leeds and Manchester. Its retail assets include the Merrion Centre in Leeds.

Mr Ziff said: “The global pandemic has presented many challenges to the UK retail market during the last 18 months. Structural shifts in consumer behaviour and the move to multi-channel retailing have been accelerated by Covid.

“TCS’s principal mixed use scheme, the Merrion Estate, anchored by Morrisons, is well-placed to benefit from a return to more normal retail-driven pedestrian flow,’’ he added.

“The retail sector is increasingly interesting to investors looking to snatch opportunist value. Unlike the shopping centre sector, high street retail investment in 2021 was on a par with 2020, with around £1.1bn of investment turnover for the first half of 2021. Institutional investors are increasingly turning away from this sector.”

Mr Ziff said there are still opportunities on the high street, especially in the essential retail category that will attract the risk-averse investor.

He added: “Investor demand for food stores remains strong with the downward pressure on prime yields. In the meantime, active landlords such as TCS are continuing to build flexibility into their retail portfolios through active asset management, planning consents and innovative terms.

“The pandemic accelerated the growth in online shopping and continues to challenge the retail sector’s traditional business model of operating larger stores on the high street and in shopping centres.

“A change in consumer laws by the government in 2022 would be very much welcome, as I believe this is something that would help reduce the climate emergency that we are facing and contribute towards reinvigorating the high street.

“In our portfolio here at TCS, we have some 21% of retail and leisure assets and these are the more stable and essential retailing sector, including food, discount and convenience,’’ he added.

“However, we will continue to respond to the pandemic in our retail and leisure disposal programme, completing further sales of our retail assets when it makes sense to do so. The last 12 months have demonstrated the resilience of our portfolio in Leeds and the strength of our mixed-use Merrion Estate in the heart of the Arena Quarter, adjacent to the Innovation District in the city.”

More than 10 years ago, TCS started a diversification and repurposing programme at the Merrion Estate.

Mr Ziff said this has continued to prove successful with Domino’s Pizza, Co-op, Leeds Teaching Hospitals Trust along with seven independent and regional tenants all opening premises during the last year.

He added: “We are thrilled to see existing tenants invest further in Merrion, such as the popular Blue Sakura Restaurant taking their second restaurant premises at Merrion, Blue Pavilion, and Morrisons’ investment in their brand new ‘Market Kitchen’ concept. There’s a lot to be optimistic about as we head into 2022.”

TCS is also committed to supporting the local community. To coincide with International Volunteers Day, head office staff at TCS have collectively donated more than 100 hours of their

time to work shifts at the Leeds Hospitals’ Charity shop, which opened on the main mall at Leeds Merrion Centre in May 2021.