Recent rises in confidence amongst shopping centre executives have proved to be short lived after the International Council of Shopping Center's (ICSC's) monthly Pan European Shopping Centre Executive Opinion Survey (known as the ICSC Euro-Shop Index), reports a sharp deterioration in sentiment.
With this decline, overall confidence stands only marginally higher than at the same time last year and is the lowest level since February 2012.
Despite the festive season being well underway, both sales and footfall contracted in November , now standing at levels seen last in February 2012. Rents are also a cause of concern amongst shopping centre executives, with the lowest level of confidence in rent sustainability recorded since the ICSC's Euro-Shop Index started in March 2011.
According to Sarah Banfield, ICSC's Europe-based Senior Research Analyst said: "This could well be a symptom of the evolving landlord/tenant relationship, where retailers feel they are in a better position to renegotiate their leases, particularly in secondary centers where the landlord is under pressure to maintain occupancy levels."
Indeed, occupancy was the one area to experience growth in November, probably a reflection of the seasonal trend of temporary 'pop-up shops' to make the most of the gift-buying period.
Sarah Banfield added: "November's survey of shopping centre executives reveals a disappointing reversal in the recent trend of improving industry sentiment. It all points to the fragile nature of the European retail market as rising unemployment (which reached a new high of 11.7% in the Eurozone in October), and tough fiscal policies continue to dampen consumer confidence and discourage retail expenditure.
"Although occupancy is holding up well, the post festive season may see vacancy levels rise once more as temporary occupiers exit and other retailers take stock of their seasonal performance, especially as it appears that they will need to discount heavily in order to attract spend."
Source: ICSC
