Retail: Forecourt sector remains resilient and attractive to investors according to Business Outlook 2021 Report
Specialist business property adviser, Christie & Co, has today launched its annual Business Outlook report, ‘Business Outlook 2021: Review. Realign. Recover,’ which reflects on the themes, activity and challenges of 2020 and forecasts what 2021 might bring across the industries in which Christie & Co operates, including the forecourt sector.
Despite an unpredictable backdrop, Christie & Co note that the forecourt sector remained resilient in 2020 and, whilst fuel volumes significantly dropped during lockdowns, many businesses were able to adapt and bounce back swiftly once restrictions eased. All Christie & Co deals agreed and those progressing pre-lockdown subsequently completed and prices remained stable – evidence that the market remains robust and continues to generate a healthy level of interest from a wide range of potential investors.
A key trend which emerged in 2020, as highlighted in the report, was the increase in forecourt shop sales which improved the profitability of many businesses and helped them to offset reduced fuel volumes. This was driven largely by the shift in consumer behaviour in favour of local stores over larger chains following national lockdowns and restrictions on movement.
The report reviewed the potential effect changing government policy might have on the sector moving forward, particularly recently announced plans to accelerate the Road to Zero campaign. Despite raising questions for the sector, Christie & Co remain positive that there is plenty of time for stakeholders to adapt their business model and remain viable.
In this year’s report, Christie & Co also surveyed a pool of forecourt operators to gain an understanding of sentiment within the market, and the outlook for business operations in 2021. The results underpin the sentiment that whilst 2020 was a challenging year, the sector showed its resilience and bounced back swiftly, with 53.6% of respondents noting that COVID-19 had a moderate impact on their business. While fuel sales are still recovering, most respondents feel the sector will return to pre-COVID levels within the next three years. However, a significant proportion of respondents (38.9%) feel positive about seeing recovery in the year ahead and over 50% feel there is opportunity for the sector in 2021 and beyond.
When asked about their business plans for the year ahead, 21.4% indicated they are interested in selling, while 53.3% are interested in buying. This is positive for those forecourts on the market, whereby demand is likely to outstrip supply.
Looking to the year ahead, the report also outlines Christie & Co’s market predictions which are:
- Buyer demand will continue to outstrip supply across the majority of convenience and forecourt instructions, leading to competitive bidding.
- Sellers will need to balance expectations with realistic asking prices knowing that proper marketing will ultimately result in optimum pricing.
- More disposals will come to come to market as corporates and multiples shed the tail end of their portfolios.
Steve Rodell, Managing Director of Retail at Christie & Co comments, “2020 will be a year we never forget for many reasons. I’d like to focus on the positive way the forecourt sector not only stepped up to the operational challenges it faced but also the way it will adapt and thrive into a bright future.”
Click here to read the full report, ‘Business Outlook 2021: Review. Realign. Recover’.
For further information on this press release, contact:
Bronte Hughes, Corporate Communications Executive
P: 020 7227 0794 or E: firstname.lastname@example.org