by Jeremy Payne
It used to be said that if you wanted to buy anything in Birmingham, do not go to a shop, go straight to where it is made. This was very true when Birmingham was known as the city of a thousand trades. Now, with the service and financial industries coming to the forefront, retailing is becoming more and more essential.
The city fathers have to decide how best to redevelop one of the more important retail areas, the Bull Ring Shopping Centre. London & Edinburgh Trust acquired Laing’s leasehold interest in the 1960s scheme two years ago and have come up with a number of different plans, known as the Galleries in the Bull Ring, to satisfy the local authority, which owns the freehold of the site.
LET have taken in various other land holdings in the area, including the old Moor Street Station and the politically sensitive markets area. They have been countered by an alternative plan put forward by a local pressure group, the Peoples Plan for Birmingham, and this has caused great debate and lobbying within the local planning committee. To date, the local authority has asked LET to redesign their proposals, which could then be put forward for detailed planning consent. We await with interest the outcome of what could be the most important retail planning decision in Birmingham since the Bull Ring was built.
The market in the city centre has been quiet since the opening of Royal Life’s award-winning Pavilions. Complaints by some of the tenants about the level of trading have forced the landlords to reduce the rents by 15% for the larger retailers and up to one-third for the smaller ones, but subject to turnover provisions. It is to be hoped that, after its second Christmas, trading levels will have improved as it becomes a more favoured shopping destination for the reputedly frugal Birmingham customer.
Likewise, Ladbroke’s City Plaza speciality scheme, in a slightly secondary position, has been slow to let. Zone A rents of up to £70 per sq ft have been achieved with lettings to such up-market operators as Jaeger, Jones the Bootmaker, Henry’s Leather, Dillons Books, Mondi and Bickler, but it appears that the owners are taking their time to achieve the best lettings to the more attractive tenants, as a number of units remain empty.
Other deals in the city centre appear to strengthen the already established rental level at about £130 zone A. Land Securities, represented by Leslie Furnes, let 11-13 Union Street to Burton at a rent equating to just over £130 zone A. Burton, who were committed to spending a considerable sum on this prominent corner unit, have now placed it on the market and strong interest is reported for an assignment.
Chesterton are courting tenants for the only prime retail development going up in the city at present — Kings Parade, linking High Street with Dale End, comprises seven units on a busy thoroughfare. Terms have been agreed with TSB at about £110 zone A for unit one, the weakest position, and the agents report strong interest for the other units. It is possible that, despite the caution shown by retailers at present, some new all-time-high rental levels could be achieved.
Strong interest remains in niche retailing, despite City Plaza’s slugishness in letting, and elsewhere in the city centre speciality shop rents are catching up. The latest unit in Prudential Assurance’s Great Western Arcade has been let by ourselves to Sekai at a rent equating to £50 zone A. Grimley J R Eve, who acted for Sekai, have also let a unit in Horton Estates’ Piccadilly Arcade, New Street, at a rent of £71.61 zone A. This is at the entrance to the arcade; a rent of £48.45 zone A has been achieved within the scheme with a letting to Pure Magic represented by Johnson Fellows.
Other retail and leisure developments are proposed outside the city’s traditional shopping area. These are good examples of Birmingham using retailing as part of the formula to enhance areas of decline, and encouraging growth from the new-found economic strength in the service and convention industries.
Merlin/Shearwater/Laing’s Brindleyplace festival shopping scheme will include certain elements of High Street trading as well as niche retailers. More exciting, however, the scheme — centred on four canals and next to the Convention Centre and Indoor Arena — aims to draw visitors from a wide area to its food and beverage operation, which is proposed to take at least 50,000 sq ft of the 200,000 sq ft planned. Letting agents are Bernard Thorpe.
Arcadia, a development by Avatar in Birmingham’s Chinese quarter and close to the theatre and restaurant area, aims to enhance what is already a busy night spot. Proposals include, along with 30,000 sq ft of speciality shopping, offices a multi-screen cinema, night clubs and a hotel. Units range between 400 sq ft and 2,749 sq ft and the scheme is due to open in summer 1991. Letting agents Grimley J R Eve and James & Lister Lea are quoting rents of £15 to £20 per sq ft.
Outside the city centre, an exciting example of urban regeneration is now nearing completion. One Stop on the main A34, 2 miles north at Perry Barr, is being developed on the site of a former suburban 1960s shopping precint. The joint developers, Ladbroke City & County Land and Lynton, are spending £40m to create a family shopping environment including 350,000 sq ft of retail space and an 85,000-sq ft Asda store, a 20,000-sq ft variety store, 10 retail warehouse units, 35 units and parking. Tenants in the scheme, which will open for trading later this year, include Texas Homecare, Iceland and Miller Brothers in the warehouse units, while National Westminster Bank, Stead & Simpson and Halifax Building Society have taken space in the mall. Letting agents are Hammond Phillips, Grant & Partners and Healey & Baker.
The two main satellite towns within the Birmingham conurbation, Solihull and Sutton Coldfield, are both awaiting with keen interest new retail developments. Solihull council has selected Citygrove In-town, in association with Bredero Properties, to develop the £100m Touchwood Court on the Civic Centre car park to the rear of High Street. Outline planning has been granted, with detailed consent expected in the spring.
Comprising a single-level shopping centre designed along classical lines, the scheme will provide 250,000 sq ft, including an 80,000-sq ft department store and a 26,000-sq ft variety store. Construction is due to start in mid-1991 with completion towards the end of 1993.
Solihull has experienced dramatic rental growth in the past few months with rents now reaching as high as £150 zone A against a regional trend showing a slowdown in the rate of growth. For example, 83 High Street, owned by Hardanger Properties, has been let to Clinton Cards at £115,000 pa. The unit comprises 1,585 sq ft on the ground floor, 655 sq ft on the first floor and 460 sq ft on the second floor. Meanwhile, Allied Dunbar, represented by Phoenix Beard, have acquired the freehold of the former Seasons department store in High Street from Central Midlands Co-operative Society for £11.3m. The property is opposite the proposed Touchwood Court scheme and comprises 20,000 sq ft on two floors and part basement. Bernard Thorpe and Oliver Liggins acted for the vendors.
In Sutton Coldfield, outline planning consent was granted in August 1989 for a 249,000-sq ft multi-million-pound development by MEPC Developments and building work is expected to commence within two years. The scheme, on a site bounded by Parade, South Parade, Queen Street and Lower Queen Street will include three principal stores ranging from 13,000 sq ft to 49,000 sq ft, 33 units and a variety of speciality kiosks.
Moving out of the Birmingham conurbation and westwards into the Black Country, the major scheme which cannot be ignored in a regional context is the Merry Hill Centre at Brierley Hill developed by Richardsons. Phase five opened for Christmas trading last November with 98% occupancy, adding a further 1.2m sq ft and tripling the size of the existing space. Marks & Spencer will come into the scheme, whose latest phase includes Options, Superdrug, Our Price and Debenhams. Plans for phase six are now being finalised for a £250m mixed office and leisure scheme with 50,000 sq ft of speciality shopping.
This development, whose only UK comparison is the Metro Centre, Gateshead, has become the most important retailing factor in the Black Country, with a catchment spreading far beyond Birmingham to the east and south and west into Worcestershire and Shropshire. Its lasting effects on the traditional centres of Wolverhampton, Dudley, West Bromich and Stourbridge remains to be seen, but reports are that traders in these towns are not happy. Rental growth has slowed down with uptake of vacant units tending to be by the more local traders unable to afford the higher rents in the new schemes.
Add to this Sandwell 2000, a similar-sized regional shopping development just off the M6 at Wednesbury, with construction proposed to start in two years and the prospects for retailing in this area remain turbulent, to say the least. Town centres will suffer while out-of-town retail schemes blossom. But, all in all, the general public may well benefit from an enriched shopping environment that in the course of its development will have added millions of pounds to the regional economy.
