Official figures from the British Retail Consortium have confirmed that retail sales rose in January. Despite the recession, sales were up an impressive 3.6% on January 2008, and up 0.7% on December.
This raises the question of whether consumer confidence is returning, and therefore whether the retail commercial property market in London might also experience a revival in fortunes.
In particular, National Statistics recorded a 6% rise in clothing and footwear. However, many analysts warned that sales were unlikely to continue at this rate because the rise could be attributed to clearance sales, and declined as they came to an end. Overall, consumer spending is expected to fall by around 3.5% this year.
Faced with rising unemployment, increasingly cautious customers may have been acting more conservatively by making the most of bargains when they could. If this view is correct, spending will drop sharply in the coming months and the drop in the commercial property prices in the retail sector will continue.