Today's headlines suggest that uncertainty over Brexit is to blame for the lowest level of retail sales for seven years, with fashion being hardest hit by the apparent drop in consumer confidence. The recent high profile retail insolvencies of BHS and Austin Reed have no doubt helped to heighten the levels of anxiety about the retail economy.
Of course, one of the main reasons for the decrease in consumer confidence is concern about Brexit, although this is not likely to be the only factor at play, with political turmoil in the Eurozone, interest rates and lack of credit also contributing to the uncertainty. It is however clear from the recent report by the RICS that fears about the UK's future relationship with Europe are putting off international investors from investing in commercial property.
But what does this mean for retailers looking to break into the London market?
In Central London, it is hard to ignore that a significant proportion of retailers originate from elsewhere in Europe. Central London has long been an attraction for European fashion houses, with many having flagship stores in areas such as Mayfair, Knightsbridge or Chelsea. London also plays an important role in bridging the gap between Europe and the rest of the world, with a high number of both visitors and residents from the Middle East, China and the US.
So, is the upcoming referendum putting off retailers from taking premises in Central London?
Perhaps surprisingly, there is little to suggest that this is the case. Companies that are keen to take premises in Central London do not appear to be stalling, awaiting the vote on 23 June. Ed Humbert, a Senior Director at CBRE, observes: "There are no obvious indications that retailers are putting acquisitions on hold due to a possible Brexit. Whilst there is caution in the marketplace, plenty of deals will be concluded ahead of the Referendum”.
It is likely that retailers are thinking on a more long term basis. Consumer spending is likely to dwindle in the run up to the referendum, but what about afterwards? The British are not the only consumers in Britain and London has long been a popular shopping destination. If Britain does leave the EU, the pound is likely to weaken, in the short term at least, making goods cheaper to those from a stronger currency. Visitors from outside Europe will not be directly affected by the change in European dynamic, but they will still benefit economically - as will the retailers selling them the goods. Whatever happens, most retailers still think that London will maintain a high level of shopper spend no matter how the vote goes on 23 June.