Construction of both shopping centre and retail warehouse park floorspace in the UK has declined by 40% from the peaks recorded in 2007 and 2004 respectively. The total amount of shopping centre floorspace under construction in November comes to 735,000 m2, down 40% on the 1.2 million m[sup]2[/sup] peak recorded in March 2008,according to CB Richard Ellis.

Construction of both shopping centre and retail warehouse park floorspace in the UK has declined by 40% from the peaks recorded in 2007 and 2004 respectively. The total amount of shopping centre floorspace under construction in November comes to 735,000 m2, down 40% on the 1.2 million m2 peak recorded in March 2008,according to CB Richard Ellis.

The broker described the fall as the fastest rate of decline since the onset of the UK recession in the early 1990s. About 743,000 million m2 of shopping centre space is set to open this year with a further 436,000 m2 notionally scheduled to open in 2009.

CBRE said that the total that will open next year is likely to fall short of scheduled figures. Since May alone completion dates for over 930,000 m2 of shopping centre space - about 17% of the pipeline total - have been rolled-forward. 'As market conditions worsen, more and more schemes will see completion dates rescheduled into future years. How long the development freeze will last is anybody's guess albeit, because of the complexity of development activity, once construction activity slumps it is apt to take a number of year to recover,' the broker said.

In a separate report for November, CBRE said the decline in the pipeline for retail warehouse parks in the UK continues. The pipeline is now almost 40% down on the most recent peak figure recorded in September 2004. CBRE said pipeline levels have been in continuous decline since 2004, well before the onset of the global credit crisis.

Retail park scheme proposals are now at their lowest level since March 1993 and are likely to fall further. Construction levels have meanwhile dipped below 186,000 m2. The research report indicates that the number of retail park schemes under construction is very small. Unlike shopping centres, which have lengthy development periods, retail parks are relatively quick to build. Most of the schemes currently under construction will be completed next year.

CBRE said that retail park completion levels have been trending-down, due to planning constraints rather than demand factors, for a number of years. Really good sites, where planning consents can be obtained, remain in very short supply. Completions are expected to fall back further over the coming months as development starts are deferred due to deteriorating economic conditions. As in shopping centre markets, the scheduled completion dates of many park schemes will be rolled forward into future years until market conditions improve.