Prospects for retail are bright, especially in big cities like London and Dublin, experts agreed at EPRA Insight, a conference in London organised by the European Public Real Estate Association. Where demand and location are right, e-commerce and shops can co-exist and strengthen each other.

Prospects for retail are bright, especially in big cities like London and Dublin, experts agreed at EPRA Insight, a conference in London organised by the European Public Real Estate Association. Where demand and location are right, e-commerce and shops can co-exist and strengthen each other.

‘There is a greater sense among retailers that a presence in the right locations has a key part to play and actually has a positive impact on internet sales,’ said Chris Grigg, CEO of British Land, which has half of its business in retail, especially shopping centres. ‘The two are definitely interlinked, and the multichannel proposition is here to stay.’

Peter Collins, CEO of Kennedy Wilson Europe Real Estate, which has 25% of its portfolio in retail, agreed: ‘My view is that retail will survive and thrive,’ he said. ‘The UK economy is growing, wages are creeping up, confidence is high, and that is all good for retail. I see some rental growth ahead, double-digit equity returns, and an average of 6% yields on our shops.’

Yields of 6% in London were also forecast by Toby Courtauld, CEO of Great Portland Estates: ‘The fact is there are are no vacancies in central London retail, because everyone wants to be here. There is strong demand for units near where people work.’

Strong demand is not confined to the UK but it is visible in Ireland too, particularly in the capital. ‘In Dublin retail really took a hammering during the crisis and is now set for a bounce,’ said Collins. ‘All the big international players are coming to the market and we have bet on shops rather than shopping centres. We are expecting rental growth in Dublin, even if yields have probably run their course.’

The positive trend in both the UK and Ireland stretches to residential, Collins said: ‘Demand is high,so we are importing multi-family resi from the US into Europe, it is a market we really believe in. There has been very little building in Ireland recently, so we are particularly bullish on rental prospects in Dublin.’