Pop-up shops to bring Christmas cheer to landlords and high street, says law firm

Liberty has opened up pop-up shops

Liberty has opened up pop-up shops

Pop-up shops, once the preserve of charity Christmas cards and discount book retailers, are now a familiar sight on our high streets and are attracting ever more prestigious brands. 

They are, claims commercial property law firm Boodle Hatfield, being increasingly welcomed by landlords who are sitting on significant numbers of empty retail units.

The pop-up shop season is soon to reach its peak as the high street prepares for Christmas. 

Richard Hughes, a solicitor specalising in commercial property and retailing, said: “Landlords, particularly those in shopping centres or retail destinations, have typically been wary of pop-up shops, as they can have detrimental effects on income and on brand. But with an ever increasing number of empty units and more top-end brands creating unique shopping experiences, the pop-up shop can be an attractive tenant.”

Last year, Regent Street department store Liberty opened a number of pop-up stores, as did online retailing giant eBay and the nation’s best-loved spread, Marmite.

It is, however, predominantly the preserve of the smaller, boutique retailers and food producers that dominate.

Hughes said: “We see a lot of small and first time retailers wanting to try the water before committing to a 10 or 15 year lease.”

Richard offers this advice to retailers considering a pop-up shop:

  • Flexibility is key – does your lease allow you to stay longer if it works or get out quickly if it doesn’t?
  • What kind of lease are you being offered?  Does it require a simple flat weekly rent, or does the landlord seek a percentage of turnover, known as a turnover rent?
  • Ensure your lease includes service charges and insurance rents – these can prove expensive add-ons.
  • What does the lease say about returning the property when you move out?  Are you required to return it in a clean and tidy condition or are you liable for all wants of repair, which could again be costly?
  • If considering a mobile unit or pop-up restaurant you will need to check local planning and licencing regulations.

Richard also offers this advice to landlords who may be considering letting empty units to pop-up retailers:

  • Empty units cost money, particularly given liability for non-domestic business rates after three months’ vacancy.  A tenant, even for a short period of time, will generate income.
  • A pop-up retailer may decide to take a much longer lease after testing the water.
  • Pop-up shops can increase footfall, as shoppers show an interest in new retailers.
  • Do take care with regards brand.  Will a pop-up retailer have a detrimental effect on surrounding retailers?  Will the centre be labeled as a place with just pop-up shops?

Hughes said: “All landlords would ideally like a Marks & Spencer or Top Shop in their units, but that is no longer realistic. Pop-up shops, however fleeting, are firmly part of the high street and are welcomed by shoppers and other retailers. Landlords too are increasingly aware of the advantages they bring.”