Do High Street Retail Rents Align with the Economy? An Analysis of Retail Real Estate Pricing Dynamics Based on Macroeconomic Trends

Abstract

This study closely examines the correlation between high street retail rents and key economic indicators, specifically Consumer Price Index (CPI) and Gross Domestic Product (GDP). Utilizing data on rent levels from prominent high streets globally, the analysis incorporates these macroeconomic indicators to discern patterns and relationships. Through methodologies such as multiple linear regression and Error Correction Model (ECM), the paper aims not only to analyze how high street retail rents align with CPI and GDP but also to explore the primary factors influencing these rents. In studying high street retail properties or considering the acquisition of such properties, this methodology can be used to determine whether a high street is susceptible to macroeconomic fluctuations. If not, it may be necessary to consider the uniqueness of the area or potential risks involved.