Every 7th shop site seen unoccupied by end-2009

LONDON (Reuters) - More than one in seven retail sites, or about 135,000 outlets, will be unoccupied by the end of 2009 as growing numbers of shops are driven out of business by the economic downturn, researchers Experian said on Tuesday.

Experian forecast that vacancy rates on Britain's shopping streets would reach a record 15 percent by the end of this year, up from 7 percent.

The proportion of empty shops would rise to 10 percent as soon next month, following a string of recent business failures such as sweets-to-DVDs group Woolworths and furniture chain MFI.

"The unprecedented level of retail vacancy will be disproportionately spread across Britain, so that smaller retail destinations, in particular market towns across Britain, will be worse affected," said Jonathan de Mello, Experian's director of retail consultancy.

Earlier this month Experian forecast that a downturn in consumer spending, rising costs and growing competition from the internet would drive more than 1,600 retailers out of business this year, sparking thousands of job losses.

"Britain is still a nation of shopkeepers and the retail sector is one of the UK's largest employers. It is not just people directly employed by retailers that will suffer from the fallout this Christmas, it is also their suppliers and service providers," de Mello said.

(Reporting by Mark Potter; editing by John Stonestreet)