Silver linings on the high street

April 15, 2021

From our founder, Katharine Hibbert

As Britain’s shops and pubs reopen from lockdown, the impact Covid-19 has had on commercial property is becoming impossible to miss as many units remain shuttered.  These closures are a tragedy for staff members, business owners, landlords and for shoppers who relied on local outlets.  The transition to new long-term uses will be painful, economically challenging and slow. 

However, empty space can be a magnet for creativity and innovation, and Dot Dot Dot is just one of many organisations offering ways to turn empty space from a problem to be solved into an opportunity to do something worthwhile. We hope we can be part of the solution as Britain builds back better.

As one door closes…

While life is returning to the high streets, many shopping parades are looking sadly empty. Household names like Debenhams, Topshop and Dorothy Perkins have gone for good as bricks and mortar retailers, along with countless independent shops, while eight branches of John Lewis won’t be reopening.

In total, there was a net loss of nearly 10,000 chain stores across the country during 2020, according to research by PwC – a record decline since they started gathering this data.  PwC’s experts forecast that the picture is likely to get worse during 2021, because shops that were closed temporarily during lockdown weren’t included in the tallies, and only retailers with at least five branches were counted.

The worst-hit areas are central shopping streets in cities, as people worked from home and didn’t travel into city centres to shop – London, Birmingham, Leeds and Newcastle have had a higher-than-average number of closures.  Meanwhile, retail parks with large stores and plenty of parking did better, as did small town centres closer to people’s homes – places like Harlow, Eastbourne and Welwyn Garden City have lost fewer shops.

Many shops that remain in business are struggling to pay the rent for their spaces.  Land Securities, one of the UK’s largest commercial landlords, collected only £2m of the £7m they were owed in March by London retailers according to a report in the Financial Times, while outside London its retail tenants paid £5m of the £13m owed.  A ban on evicting commercial tenants put in place by the government will end on June 30th, so more shops may face closure at that point.

This is terrible news for the 180,000 retail workers who have lost their jobs.  The difficulties ripple out – for example, sellers of The Big Issue are finding that the loss of footfall at previously reliable pitches is a challenge. 

…Another one opens

While no one would wish for this disruption and its impact on individuals and the economy, many of the changes caused by the pandemic are accelerations of pre-existing processes, such as the shift to online shopping. 

Some kinds of shops are likely to do well over the coming years – new coffee shops and takeaways are opening, according to the PwC research.  The British Heart Foundation reported a record day of trading when stores reopened on Monday, selling £1m worth of goods, and showing that eBay is no substitute for browsing second-hand treasures in real life. 

Despite these pockets of success, it seems inevitable that high streets as a whole will need to be reshaped.  Meanwhile approaches can ease that process and contribute to designing the future.  Empty buildings are a problem for everyone – most immediately for their owners, who have to pay tax on them despite earning no income, and who face the costs of dereliction or squatting.  But they’re also bad news for everyone else – a scattering of empty shops can make a street off-putting and unwelcoming, harming business for stores that remain and spoiling the experience for shoppers. 

Meanwhile uses solve these problems, while also creating opportunities for experimentation and entrepreneurship.  The Ebury Edge project run by Meanwhile Space CIC with Westminster City Council is a great example. Instead of an empty site waiting for a housing regeneration project, there is now a brightly-coloured, architect-designed set of offices and studios, plus a café run by Fat Macy’s, a social enterprise which creates opportunities to get into catering careers for young people who have experienced homelessness. 

Similarly, the London Borough of Croydon cooperated with a group of local artists and community members to create ‘Saffron Central’, where a previously empty site was planted with crocus sativus – the flower whose stamens are saffron.  This was done to remind residents that Croydon’s name derives from Anglo Saxon ‘Croh Denu’ meaning “Crocus Valley”, and to enable them to pick their own saffron – a spice that, weight for weight, is worth more than gold.

And housing association Poplar HARCA turned one of its empty shops at Chrisp Street Market into a pop-up radio studio to broadcast “Chrisp Street On Air”, a project that shared and amplified local voices and helped increase understanding of how different groups and individuals felt about their area and what they wanted for its future.

Projects like these – which treat their temporary nature as an opportunity to experiment rather than a constraint, and which can point the way to future uses – can help our high streets.  Commentators and think-tanks are suggesting that housing is what our town centres need, while others recommend night clubs or spaces for children to play.  It will take time to put these uses in place permanently – but we can get on with doing it on a temporary basis straight away, creating short-term opportunities, and in the process seeing what works and what doesn’t work. 

At Dot Dot Dot, we’ve been turning empty buildings into good homes that support residents to get involved and contribute locally for the past ten years, and we’re looking forward to working alongside our meanwhile and placemaking peers to breathe life back into the empty spaces left behind by lockdowns.

 

Pricing people in, not out

February 17, 2021

From our founder, Katharine Hibbert 

For people who rent their homes, finding a nice place in a convenient location for a price you can afford has been a challenge in the UK for a long time.  This issue was a key reason why Dot Dot Dot was launched in 2011, and the situation has become worse over the past ten years.  This contributes to a wealth and an opportunity gap as well as making life more difficult on a day-to-day basis for those who struggle to house themselves.

The problem

Over the past decade, the price of a property in London has nearly doubled, while the proportion of younger adults renting or living with their parents rather than owning a home of their own has grown.  This has created a widening wealth gap as those priced out of home ownership have got poorer and those who already owned homes have got richer, recent research by the Institute for Fiscal Studies has shown.  This gap broadly falls along generational lines – by and large, older people are homeowners, whereas millennials have been unable to buy.  

As rents have gone up, saving for a deposit or for any other reason has become harder – at the beginning of the coronavirus crisis, one in five people who rent their homes had no savings at all.  Then, when the lockdowns came, renters saw the biggest hits to their incomes, according to the Resolution Foundation.  As a result, 6% of renters are now in arrears whereas only 2% of home owners are behind on mortgage payments.

Meanwhile, many homeowners have seen the value of their homes rise.  The low cost of borrowing for those with substantial deposits and the government’s decision to cut stamp duty has pushed house prices to an all-time high in December, up 6% from a year ago, according to mortgage lender Halifax.  

This has made those who already owned their homes wealthier, but has put home ownership even further out of reach for the young, especially as mortgage lenders pull back from lending to those without large deposits.

Buying is particularly difficult in London.  First-time buyers in the capital paid an average of £420,618 for a home at the end of 2020, the equivalent of more than nine times their earnings, according to Nationwide Building Society – a level which is almost impossible for those without very large savings or money from families. 

Long-term solutions

Just as we at Dot Dot Dot have seen the situation get worse for renters, we have also seen growing calls for solutions.  Suggested options for improvement abound – the centre-right think tank Policy Exchange last week launched a report recommending a form of blended mortgage product that would deliver 95% loan-to-value home loans.  The loans would be provided by three different financial institutions, with the riskiest bit – the part of the loan between 95% and 85% of the home’s value – would be provided by an investment bank.  Retail banks would provide a middle slice while the last part would be delivered by long-term investors such as pension funds.  The economists behind the paper argue that this – in combination with a land value tax and the abolition of stamp duty – would create a house-building boom.

Meanwhile, politicians on the left and in the centre argue for greater government intervention to stimulate house building.  Ahead of the 2019 election, Labour’s housing manifesto promised to build 150,000 new council and housing association homes a year.  At the same election, the Liberal Democrats promised “New direct spending on house building to help build 300,000 homes a year by 2024, including 100,000 social homes.”

How Dot Dot Dot’s work fits in

Any solution to the housing problems faced by those in the private rented sector will take time to agree and even longer to put into effect.  So until the political will is found to get on with building more houses at sensible prices in the right places, we at Dot Dot Dot are committed to creating as many inexpensive, well-managed homes as we can by using property that would otherwise be empty.  By working with property owners, we’re able to prevent the blight void buildings can cause, provide homes that otherwise wouldn’t exist and support volunteering.

In fact, even if the housing crisis was solved and everyone who wanted to own a home could afford to buy one, there would still be a need for inexpensive, flexible accommodation that property guardianship is perfectly set up to provide.  Home-ownership isn’t right for everyone – some will always want a place to live with less long-term commitment, and guardianship is a good chance to try new areas or live in quirky buildings.  And meanwhile property owners will always need buildings looked after on a temporary basis while they prepare for regeneration projects or to sell.  

So property guardianship is not only useful due to the housing crisis – but for as long as it lasts, we’re glad to be here providing options.

If you’d like to find out more about property guardianship and whether it’s the right option for you, you can read more by visiting our FAQs, or you can apply to become a property guardian with us.

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