Turnover Leases – Getting to the Truth

TTS has conducted a survey of retailers and F&B brands who operate more than 11,000 UK properties in order to gauge attitudes to turnover-based leases and how they can be implemented to the benefit of both landlords and occupiers.

The results are stark:  80% of those surveyed want to transition to an appropriate turnover lease model with an asset management regime that supports this. The growing attitude of many retailers can be summed up by one comment from a major occupier: “No shopping centre lease will now be signed off unless it is on a turnover rent”.

As the adoption of turnover leases for full price stores and shopping centres in the UK becomes essential for landlords, Total Turnover Solutions combines data analysis with asset management expertise to deliver leasing structures which deliver investable assets and committed occupiers. It is important for investors to realise that any rental growth in the foreseeable future will only come from the turnover arrangements, not the base rents, whilst there continues to be a very significant surplus of retail property across the UK, which will be the case for quite a while yet.

We hope you find the survey findings insightful and would be pleased to discuss how this structural leasing change can enhance your assets.