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New life for the high street and how it may mean new business opportunities

Published on 8th November 2018

In his recent budget, the Chancellor of the Exchequer promised to make some important changes to planning regulations that might change the look of the high street - and to offer support to small retailers.

This could mean some exciting opportunities for businesses in the retail, architectural and building sectors.

Chancellor Philip Hammond looked at various measures to breathe life back into the high street. He pointed out that in many parts of the country, the traditional high street scene of bustling, independent shops has been replaced with boarded-up properties. These do nothing for economic regeneration or for the communities they once served and may invite vandalism and anti-social behaviour.

He also came up with some measures which could improve matters.

A cut in rates for retailers

The first is a rates reduction for firms with a rateable value of £51,000 or less, which will have their business rates cut by a third over two years. An extra £900m in business rates relief for small businesses will be accompanied by £650m to rejuvenate the high streets.

This could mean some important savings for small retailers and allow firms, that might otherwise struggle, to retain profitability at a time when they already face challenges from new forces such as online sellers.

The second is more radical. The Chancellor has proposed a relaxation in planning laws that might make it much easier for surplus shops to be converted into homes and for other purposes. This would involve the creation of more leisure and community uses such as gyms and libraries, as well as creating more homes. The government has already set a target of building 300,000 homes a year across the UK, and the conversion of shops may contribute to this ambitious target.

Who will benefit from these measures?

There are several classes of business which may be affected by these developments from the Chancellor.

The first, and most obvious, are retailers of all types. Those smaller businesses which are already facing challenges to their viability in the current economic climate may find that they have more options to counter the threats. Cutting a major business expense will leave them with more money to invest in stock, marketing and staff and, with the reduction in a major fixed overhead, represents a boost to their business which, properly managed, may allow them to increase their profits substantially.

Providing a lifeline for small retail businesses might have a powerful effect on high streets up and down the country, but the Chancellor - and the government - are under no illusion about the possibility of a return to any ‘good old days’ for the retail sector. It is quite clear that the world has moved on and with the internet and home delivery of everything from groceries to clothing from online specialists, and virtually anything from the giants like Amazon, there may simply be too many retail units.  The high street needs to reduce in size.

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The second group that stands to benefit will, therefore, be those concerned with the conversion of redundant retail property.

This may have an important secondary benefit in creating new homes which will help to ease the housing shortage.  Reconstructing homes from shops which may themselves have been originally constructed as dwellings in the 19th and early 20th centuries has become a familiar, and profitable, exercise for developers in many older towns. Repurposing mixed retail and commercial structures into homes may present more of a challenge, while the conversion of supermarket spaces might present scope for uses such as gyms.

Architects, developers and builders with experience of conversions may all be able to benefit from the opportunities presented.

All these opportunities will require funding, which is where Rangewell can help.

Funding for retailers

We can help retailers find a number of funding solutions to take advantage of the cut in business rates - and the greater prospects for profitability that could result.

These include traditional solutions such as Unsecured business loans. This type of lending can provide straightforward borrowing over an agreed term under 5 years. Secured loans can provide a higher level of funding with rates that can be as low as 2% above base rate.

Also available are new solutions such as Merchant Cash Advances or MCAs. These are particularly suitable for retailers, as they allow cash advances to be secured on projected takings from credit and debit cards - effectively providing a cash advance that is repaid by your customers.

Other important provisions can include an Overdraft Replacement Facility, providing instant access to cash for short-term needs such as stock purchase, and Asset Finance. Asset Finance, such as Hire Purchase and Leasing, can help make virtually any type of equipment affordable by using the asset as the security for the finance, and spreading payments over a suitable term.

For retailers looking to refresh their shops with new displays, lighting and POS equipment, Asset Finance can be ideal.

Funding for property development

Property owners and developers may be in need of finance to fund the conversion of retail property.

At Rangewell, we can help find the finance required for all types of development and conversions, and this funding can include the acquisition of property for conversion, as well as funding for the work itself.

Refurbishment Loans can be available for as little as £20,000 while, for large projects with multiple homes and mixed-use masterplans, we can arrange sums of £15 million or more.

Whatever the size of the project, at Rangewell, we can provide the scale of funding it needs. Simply call to see the financial solutions we can help provide.

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Richard Mitchell

Richard Mitchell

Content writer
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