Two hundred shopping centres ‘on brink of bankruptcy’ as retail crisis deepens

More than 200 shopping centres are in danger of going bust, which would be “catastrophic” for their towns, experts have warned.

Malls worth £7billion are at risk of going into administration amid a wave of store closures, a report estimates.

Some have been sent into a “downward spiral” by the loss of anchor tenants such as BHS and Toys R Us.

With Debenhams to close 50 stores and fears of more House of Fraser branches being shut, other shopping centres face a worrying future.

Nelson Blackley of the National Retail Research Knowledge Exchange Centre, at Nottingham Business School, said: “If centres close, particularly in small towns, it will be catastrophic.

“If a major anchor store moves out, that has a halo effect on other stores in that centre. It’s a downward spiral and you can’t fill shopping centres with nail bars and vape shops.”

The Mirror has highlighted the impact of waves of shop closures as part of our High Street Fightback campaign.

Stores have been hammered by a toxic combination of soaring costs, including business rates, and competition from online rivals such as Amazon.

Asset management firm APAM’s report said the 200-plus centres at greatest risk were those needing funds for “much-needed redevelopment”.

They include many sites owned by overseas private equity firms, and are believed to include ageing centres in smaller towns.

Experts fear going the way of the US, where mass store closures created “ghost malls” such as Randall Park in Ohio.

University of Salford Business School’s Dr Gordon Fletcher said: “The issue for towns and communities is that the large, self-contained environments of shopping malls creates massive problems for the entire town centre when they fail or under-perform.

“Consumer preference for mass cust­omisation lends itself to locations on the edge of town centres, where rates and rentals can be lower and more flexible.”

Yet out-of-town shopping malls are also struggling.

Last week industry giant Intu, which runs the Trafford and Arndale centres in Manchester and Lakeside in Grays, Essex, cut the value of its estate by £300million.

The firm, which has 17 centres, responded by earmarking excess land for 5,000 homes.

It comes after rival group Hammerson put all 13 of its out-of-town retail parks up for sale earlier this year.

The firm slashed the value of the sites by £45million to just over £1.1billion, after reporting that half-year profits had dived 80% to £55.8million.

Meanwhile, supermarkets with mega stores are trying to get other retailers to rent excess space.

Experts say out-of-town shops will have be converted. There is speculation online firms could take some over as warehouses to speed up local deliveries.

This week’s Budget proposed changes to planning rules to make it easier to turn empty shops into homes and offices.

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