December 2011: Compared with the continuing austere outlook in the high street, garden centres have, on the whole, continued to trade well over the last twelve months. A great start to the year was sadly cut short by the weather. Overall conditions have been challenging but many centres have performed as well as last year, if not better.
Garden centre values have been holding up and even with the ongoing economic turbulence, strong demand for garden centres remains. Freehold sites remain the preferred option from independent operators but leasehold is still in demand.
Unfortunately there are garden centres that have no choice but to sell. Our advice is not to wait until a sale has to happen and there are no other alternatives. Values can drop as much as 50% once a centre becomes distressed. Now is as good a time as any to sell.
There are a number of garden centres on the market and just as many, if not more, interested parties looking to invest, develop or expand. Raising money does not appear to be an issue, finding the right product is the difficult part. Demand for garden centres is spread across the country and there is no doubt that from a property perspective, the garden centre industry is in rude health and continues to offer healthy returns for well-run businesses.