Pop-up Shops: a new trend?

16 January 2012

Pop-up shops work whereby landlords want to limit their liabilities, have a live shop-front and secure a trading entity in their property.  This can be a stand-alone on the high street or within shopping centres.

It is conducted by way of a short-term licence and allows the occupier to test the market and the trading pitch of the property.  In return, the occupier pays the landlord a licence fee which can go towards the landlord's overheads such as rates, service charge and insurance. 

By the same token the Landlord can also test if certain retailers are going to work before committing to a long-term lease.

Anne-Marie Lonergan, Director at Savills the international property consultants in Belfast said today:

“Pop up shops clearly have advantages to both parties (landlords and tenants) allowing flexibility with neither party tied in. However, this can also be seen as a disadvantage because unlike a long-term lease where an income stream is guaranteed, pop-up shops do not give the certainty required in these challenging times.  Another point to note, particularly in shopping centres is that, pop up shops can cause friction with other long-term retailers.

Whilst pop up shops have recently been making the headlines, they are not actually a new trend.  Over the years, particularly around Christmas, pop-up shops have become quite common.  Over the last few years we have closed deals with the likes of The Christmas Store, The Discovery Store and Calendar Club to set up time limited outlets to take advantage of seasonal shopping trends.

Given that Swatch were one of the primary sponsors of the MTV Music Awards, they saw merit in having a presence in Belfast city centre by way of a pop up shop located in Victoria Square.

We expect to see this trend continuing after the recession but to a lesser degree. As consumer confidence grows and the retail economy picks up again, there will not be the same volume of vacant units available that we are seeing in out of town locations and city centres at present.  Demand will therefore be more aligned with supply and it is hoped landlords will have a greater abundance of long-term tenants to choose from”.



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