BRITAIN's airports are expanding to meet the growing demand for new retail and investment opportunities. Chesterton Petty, in a special report on airport retailing, estimates that, by the year 2000, retail space in Britain's airports could double to over 600,000 square feet. The report concluded well-maintained modern airports, where retailing accounted for a significant proportion of revenue and profits, could make attractive investment opportunities. Airports are restricted from increasing landing charges, whereas retail represents an unregulated and growing source of income, according to Chesterton. ''If local authority-owned airports - such as Birmingham, Bristol and Cardiff - are sold to the private sector, external investment funds may be sought for future development.'' At Britain's 15 largest airports, there are 248 shops and 323,794 square feet of retail floor space. Heathrow, Gatwick and Manchester have the bulk of the space. Chesterton Petty said their research indicated that airports could support an additional 241,208 sq ft of retail space, creating a new sector of travel-related retailing. The report says airports represent a good opportunity for British and overseas retailers to expand in Britain and boost their profile. Airports are likely to be suitable locations for niche retailers specialising in clothing, electronic goods, audio and video products, silverware, diamonds, tools and antiques. Other retail opportunities under consideration by airport owners could include electronic retailing, where customers use computer catalogues to order goods which are delivered to their homes or destination airport. Chesterton said for the investor, airport retailing had certain advantages such as a captive, affluent and growing consumer market and planning restrictions meant there was little chance of new competition from a retail development opening nearby. Rather than the traditional fixed rent with regular reviews found in the high street, airport operators favour variable rents payable on a fixed percentage of sales turnover. The report says the value of a shopping centre based on turnover rent and short leases is likely to be lower than that of a shopping centre. ''Such an investment could provide a secure and high-yielding asset for the right investor. ''Shopping centres which employ turnover rents are common in the United States and the rest of Europe and investor demand may come from buyers with experience in those markets.'' Chesterton warned airports were vulnerable to a loss of airline operators and any switch by a major airline could severely reduce passenger throughput. Growth in airport retailing is also likely to have an impact on traditional centres, if the shops are accessible to non-travellers, although the location and cost of car parking may be a problem.
