General Retail News k.com

25th October 2013 WEEKLY RETAIL NEWS HIGHLIGHTS FROM AROUND THE MARKET

General Retail News

Waitrose the supermarket, opened its 300th store this week in Helensburgh, near Glasgow. This followed the announcement of its plans to triple in size over the next ten years and open an additional 20 stores a year.

Topshop the fashion retailer, has opened its first store in France with the 1,938 sq ft shop in the Galleries Lafayette department store, Paris.

Tesco the supermarket, has launched its first distinct F&F unit within the 2,300 sq ft West Kensington store. This is part of a drive to identify F&F as a fashion label. An announcement regarding the locations of planned boutique stores is expected shortly.

Les 100 Ciels the Asian womenswear retailer, has entered the UK with the launch of its 772 sq ft first store on St Christopher's Place. The company will be using the store as a stepping stone to enter the European market.

Costa Coffee the coffee chain, has become the latest operator to agree to open at London Heathrow's new Terminal 2 in June 2014, with a new 3,000 sq ft store.

Loungers the caf? bar concept, has announced plans to open 15 stores in 2014 after it opened its 39th site in Heswall, Wirrall last week.

Cocosa the luxury fashion brand, will be wound down. Owner Mohamed Al Fayed announced the decision only two years after purchasing the company.

Mitchell & Butlers will open a new Harvester Salad & Grill in Nacton, Ipswich in November, creating over 40 jobs.

Starbucks the coffee chain, has opened its first standalone tea store under the Teavana brand on Madison Avenue, New York. This comes almost a year after Starbucks bought Teavana for $620m.

Pizza Express the restaurant chain, will open four more franchises in Mumbai before Christmas, to continue their international expansion programme.

The 350,000 sq ft London Designer Outlet officially opened this week next to Wembley Stadium. The scheme comprises 70 stores, with 24 opening this week (including M&S, Nike and Superdry) and the others due to open by spring 2014.

Fitness First the gym chain, will launch its first new UK club since offloading 64 sites in a restructuring last year. The new club will open in Bishopsgate next spring.

Byron Burger the restaurant chain, has been acquired from Gondola by Hutton Collins in a deal worth ?100m. The new owners have outlined plans to grow the chain from 34 to 80-120 restaurants over the next few years.

French Connection the fashion brand, will close 15 shops as part of the firm's efforts to return the chain to growth, in the face of business rates reaching 40% of turnover.

Grand Central Birmingham, the retail

development

scheme

above

Birmingham New Street has announced

the latest retailers to sign up. The

White Company, L'Occitane and

Kiehls have agreed to take 3 of the

scheme's 40 retail units.

KNIGHT FRANK RETAIL NEWS

Robert Dyas, Canary Wharf Acting on behalf of Robert Dyas, the Knight Frank retail team have acquired additional premises for an extension of our client's Canary Wharf store, located adjacent to Waitrose at 16-19 Canada Square. The new space increases the store's total floor area from 3,000 sq ft to 4,650 sq ft.

Tweet of the Week

Knight Frank Retail @KFRetail

21st October 2013

UK shopping centre investment volumes for 2013 will reach ?4bn, the highest for 5 years, reports @KnightFrank

RETAIL IN DETAIL: 25TH OCTOBER 2013

Retailer OPTIMISM

Marks & Spencer the department store, will open 150 new stores over the next three years as it continues to outperform in grocery, clothes and homeware sales. The company has also agreed its first international franchise deal for standalone food stores with ten shops to open in partnership with Relay in France and further food outlets to open in the Netherlands after a successful trial period. At least half of the proposed new Simply Food outlets in the UK will be over 9,000 sq ft and offer the full range of M&S food.

DFS the furniture retailer, has recorded a 7.4% increase in sales to ?670.8m and a 4.9% EBITDA increase to ?86m in the year to July. A year-end cash balance of ?38m was recorded despite ?34.4m net expenditure from bond refinancing and shareholder dividends. The strong results came after the opening of eight new stores in 2013, bringing its UK total to 97 stores.

RETAIL OUTLOOK FOR THIS WEEK

ASOS the online fashion retailer, recorded a 23% increase in pre-tax profit to ?54.7m and has kick-started its plans to invest ?55m into the business over the next two years with the acquisition of a European distribution centre to supplement its ?30m Barnsley hub. This follows a sales increase of 40% to ?753.8m yearon-year to August, strongly helped by a 44% increase in international sales (comprising 63% of total sales) to ?477.8.

Harrods the luxury department store, has paid its owner Qatari Holding a ?69m dividend after group profits rose 1.8% to ?92.5m in the year to February, boosted by a 10% year-on-year sales rise to ?765.4m.

Sports Direct the sports retailer, reported a 19.4% gross profit increase to ?199.8m and a group sales rise of 15.1% to ?463.7m in the nine weeks to September 29th. Sport retail sales grew 14.8% to ?395.7m but it was sales of the premium lifestyle range which saw the greatest improvement ? rising 74.9% to ?32m due to the inclusion of revenue from Republic for the first time since its acquisition in February. The company remain confident of reaching their ?310m full year EBITDA target.

Did You Know?

Primark's average store size in the UK has increased by almost 5,000 sq ft over the last five years.

Market sentiment

Research by Knight Frank has shown that investment in UK shopping centres is anticipated to reach ?4bn by the end of 2013 due to an increase in willing buyers. The Knight Frank UK Shopping Centre Investment Report this week showed that the number of investments had increased 45% yearon-year in Q3 2013 to ?2.92bn and has already exceeded the entire 2012 total of ?2.74bn.

However, despite strong interest from investors, research by the British Retail Consortium has shown a 2.9% national year-on-year slump in footfall for shopping centres in September 2013. Throughout the same period, a 2.7% decrease in high street footfall and a 1.3% decrease in out of town footfall was recorded, leading to an overall 2.4% reduction and pointing towards a difficult run up to the Christmas period for retailers.

The southwest and West Midlands were the worst hit with 3.5% and 5.5% decreases respectively. Mitigating factors should be considered, including the post-Olympic period and that the unseasonably cold September in 2012 drove purchases of winter clothing and led to higher than average footfall. Despite this, the figures will be a serious concern for retailers leading into Christmas.

KEY CONTACTS

DEVELOPMENT CONSULTANCY Ian Barbour, Partner, Head of Retail T +44 20 7861 1223 E ian.barbour@

AGENCY Richard Griston, Associate Partner T +44 20 7861 1188 E richard.griston@

LEASE ADVISORY Jeremy Elphick, Partner T +44 20 7861 1590 E jeremy.elphick@

The above information is sourced from Property Week, Estates Gazette, Retail Week, Drapers, The Times and the BBC and does not necessarily represent the view of Knight Frank LLP in relation to particular properties or projects and must not be relied on in any way. No legal responsibility can be accepted by Knight Frank LLP for any loss or damage resultant from the contents of this document.

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