Business News Round Up (27/01/2023)
Research reveals that one in six Scottish shops is lying empty
One in six shops in Scotland are vacant, a rate that is one of the highest in Britain, according to the latest Scottish Retail Consortium (SRC) and the Local Data Company figures. The SRC warned vacancy rates may struggle to “ever fully recover”. The rate remained 15.7% for the third consecutive quarter – an 0.4% improvement on the same point in 2021. Scotland ranked eighth out of 11 areas UK-wide for the highest shop vacancy rates, with the North East of England ranking worst at 18.2%. SRC director David Lonsdale said there is “little sign” of improvement north of the border. “Scotland’s vacancy rate has plateaued over the past three quarters and seems stubbornly stuck at a fifth higher than during pre-pandemic times. Whilst there has been a small improvement over the past year, the fact is Scotland’s store vacancy rate is above that for Great Britain as a whole, with one in six stores lying empty. The volume of empty units is especially marked in shopping centres. The fallout from the cost-of-living crunch and pandemic is exerting a heavy toll on retail destinations, as does what increasingly looks like a sustained shift towards hybrid working. This could make it trickier for store vacancy rates to ever fully recover.” In Scotland, shopping centre vacancies in the final quarter of 2022 remained unchanged from the same point in 2021 at 20.5%, with high street vacancies going from 14.7% to 14.8%.
https://www.insider.co.uk/news/research-reveals-one-six-scottish-29057205
Deals market vibrant in 2022, with good prospects for current year
Accountants and business advisor, BDO, said 2022 was another standout year for its M&A teams in Yorkshire and the North West, with 36 deals completed across the region, reaching a total value of more than £900m. Nationally, BDO advised on 362 deals in 2022 with a total value of £31.2bn. Among the North West deals, 69% of transactions involved private equity. Deals spanned a range of sectors, including technology, manufacturing, recruitment, financial services, food and drink, leisure, transport and logistics, and construction and business support services, as well as healthcare and life sciences. Jason Whitworth, corporate finance partner, M&A, in the North, said: “When you consider the economic headwinds that have been blowing strongly against businesses in 2022, the regional deals market over the last 12 months has been extraordinarily resilient. Interestingly, deals are still getting done across all sectors, particularly those sectors where long term macro-economic and social tailwinds support long term growth. Specifically, deal volumes in business services, financial services and TMT remain strong, as the adoption of technology continues at pace and accelerated by a desire to realise cost efficiencies.”
Tackling the cyber skills gap with internal investment
According to concerning UK government research, more than half (51%) of British companies lack the ability to carry out the most basic of cyber security tasks, while a third (33%) are unable to handle more advanced tasks, such as security architecture. That’s a huge number of organisations that lack the necessary skills to run a business safely and securely in today’s tech-centric world. Add to this that there is a chronic shortage of cyber security professionals as identified by the 2022 (ISC)² Cybersecurity Workforce Study, and it’s an unsustainable situation. While it is important to continue filling tech and cyber roles with experienced and trained individuals, it’s also time for more organisations to urgently consider using the resources they already have by training more of their existing staff in the rigours of cyber security. Learning and development opportunities abound in the tech sector: from continuing education courses to rapid-fire boot camp programmes, individuals without any background in cyber security can quickly pick up the skills they need to confidently support a business’ operations. Apprenticeships are another way for employers to fill their cyber security vacancies and can open development opportunities for current or future employees. And with a cyber security Graduate Apprenticeship, means employers can benefit from higher-level degree qualifications combined with practical experience.
Occupier and investor demand for commercial property in Scotland fall again
Conditions in the commercial property market in Scotland deteriorated at the end of last year, according to the latest Royal Institution of Chartered Surveyors (RICS) Commercial Property Monitor as the industry faces a challenging environment. Overall demand from both occupiers and investors fell in the quarter in Scotland, with industrial property the only sector where demand wasn’t in decline. A net balance of -14% of respondents in Scotland said that occupier demand fell in Q4 2022, compared to -9% who said so in Q3. The fall in demand was marked in the office and retail sectors (net balances of -20% and -44% respectively). A net balance of +41% of respondents in Scotland said that occupier demand for industrial space increased. In relation to demand from investors, the overall net balance was -27%. Falls in demand from investors were evident in the office (-24%) and retail (-68%) sectors. Meanwhile, enquiries from investors for industrial space were up according to a net balance of +12% of respondents. As a result of the deterioration in demand, rents and capital values are expected to fall. A net balance of -41% of respondents in Scotland indicated that they expect net capital values to fall across all sectors over the first quarter of 2023, compared to -26% in Q3.