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Pop-ups: The saviour of the retail sector

Alexandra Messham, a real estate lawyer at Hewitsons, asks whether short-term lettings provide hope for the retail sector. Are pop-ups – the ‘Airbnb of the retail world’ – the way forward?

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COULD the pop-up shop provide a glimmer of hope for the retail sector? UK shopping habits are changing, as Brits adapt their lifestyles to accommodate Covid-19 restrictions.

The challenges facing the retail sector before the onslaught of the pandemic were real enough without being forced to close under government guidelines and embrace the ‘new normal’.

Indeed, the volume of retail sales in April 2020 fell by a record 18.1%, following the strong month fall of 5.2% in March.

Co-operation between landlords and tenants has been encouraged and some were able to agree rent deferral and/or rent reduction arrangements during lockdown in the hope that they can ride out the storm and return to some sort of normality in the future. 

Alexandra Messham

The pop-up shop allows landlords the ability to generate some return from potentially vacant premises while also creating an opportunity for innovative start-ups in the sector.

There are several online platforms providing a ‘match making’ service for retailers seeking short term shop space and are being described as the “Airbnb equivalent for the retail market”. 

The arrangements generate income for landlords in the interim and allow retailers to launch their brand cautiously before committing to something more long term for the future. Strangely, the pandemic could have provided an opportunity for a new breed of entrepreneur.

A word of caution, in order to ensure that both landlords and tenants achieve what is intended with these arrangements they must be fully aware of the potential risks involved and ensure they seek appropriate advice and legally enforceable agreements.

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