0370 270 6000

already registered?

Please sign in with your existing account details.

need to register?

Register to access exclusive content, sign up to receive our updates and personalise your experience on brownejacobson.com.

Privacy statement - Terms and conditions

retail woes extending beyond the property sector and into financial markets

6 December 2019

Some commentators had anticipated that persisting retail sector challenges might disrupt more than the make-up of the high street or commercial property negotiations between landlords and tenants.

The suspension of the M&G property fund on Wednesday provided the clearest sign since 2016 of property market concerns affecting the wider financial markets. The £2.5 billion fund has already shrunk approximately £1 billion this year and the suspension comes following difficulties in selling properties quickly enough to meet investors’ demands to access their money. The fund blames Brexit uncertainty and refers to decreasing performance in the retail sector, stating that “the value of certain retail properties has declined as retailers continue to adjust their business models in response to changing shopping habits and rising costs.”

This has prompted questions from Gina Miller regarding the FCA’s role in protecting investors following the recent collapse of Woodford Investment Management; this is a topic in itself. Commentators and fund managers are also quick to emphasise that most investors will understand that property is more illiquid than most investments, and numerous funds are more varied; the M&G fund is particularly exposed with retail property comprising up to 36.4% of its assets.

This development does, however, provide a useful reminder of the factors which affect the bottom line of each party to a property negotiation. It’s not just about landlords and tenants, but also investors and consumers.

related opinions

Retail ATMs and business rates: clarity at last!

Judgement has been handed down for the seminal case of Cardtronics UK Ltd and others (Respondents) v Sykes and others (Valuation Officers) (Appellants) [2020] UKSC 21.

View blog

Retailers and landlords, are your commercial leases future-proof?

The last two weeks have seen yet another flurry of announcements regarding big high street names including Thomas Cook, Argos, Karen Millen and Coast.

View blog

Compulsory drone registration goes live on 1 October 2019

As part of the continued tightening of the restrictions on drone use within UK airspace, the latest amendments to the Air Navigation Order 2016 come into force on 30 November 2019.

View blog

H&M - fighting the two tier retail market and daring to push for better clarity on turnover rents

H&M is the latest retailer to confront its landlords about this ‘two tier retail market’ in an attempt to explore and negotiate more favourable terms.

View blog

mailing list sign up

Select which mailings you would like to receive from us.

Sign up