Northern Ireland is the last region in Britain without a factory outlet. Now not one but two are being developed. Noella Pio Kivlehan reports on the claims and counter-claims about their viability
The shenanigans involving two proposed multimillion pound factory outlet schemes have, for the past few months, animated Northern Ireland’s retail market.
Claims and counter-claims have been swirling around about Junction One in Country Antrim, and Gilford Mill in County Down, which are scheduled to open in October 2003 and next spring respectively.
Looking at the potential prize, it is easy to understand the passions. Northern Ireland is one of Britain’s last significant catchment areas without a factory outlet -a market worth more than £I.6bn pa. Belfast has an estimated 50,000 sq ft of pent-up retail demand that will not be satisfied for at least three years, and building an outlet close enough to Belfast to draw shoppers, but away from the city’s planning constraints and lack of space, is a perfect solution.
An outlet outside Belfast and near a motorway will also draw shoppers from the Republic’s market.
It is a developers’ dream -one that John Drummond, managing director of the Guinea Group, which heads a consortium developing the 150,000 sq ft Junction One, and John Farmer, chairman of the 140,000 sq ft Gilford Mill project, want to fulfil.
Drummond is investing 40m in single-storey outlet at junction I on the M22 that will incorporate “Bond Street, Regent Street, and Oxford Street” retailers with some leisure.
Farmer is spending around £28m converting a former six-storey 19th century linen mill into a mixed-use leisure/residential/ retail attraction that will be targeting the Regent Street/Bond Street market.
But the developers’ dreams could become a nightmare.
Northern Ireland may be the perfect place for an outlet, but most people believe it can only sustain one.
This is the reason both developers have been promoting their schemes with conviction and spawning debates about the locality of the projects, which retailers are being approached, and what political forces are being mobilised to back each development (see panel).
Added to this is the question of access to Junction One and the belief that it may not make its October opening date.
As any developer knows, building in an area unable to sustain the scheme is madness. Factory outlet schemes require an average of 2m shoppers pa and short drive times, which is why Britain has only 43 of them.
On this basis, Northern Ireland’s I.5m population (two-thirds of which live around greater Belfast), and the possible catchment from around the Republic’s borders stretching down to Dublin’s 1m, is why some people believe the Province can only sustain one scheme.
Drummond agrees. “To make out that Northern Ireland can take two is misleading,” he says.
Even David Trimble ME a staunch supporter of Gilford Mill, in his constituency of Upper Bann, agrees about the viability of two, saying: “I don’t think there’s going to be more than one in the Province.”
But the one-hour driving distance between the two schemes means they could coexist.
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Playing the Trimble card |
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Gilford Mill gets top politician’s backing, while rival John Drummond is concerned to win support from councils |
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As Northern Ireland’s former First Minister, a sitting MP and an internationally known media face, David Trimble’s public backing of the Gilford Mill scheme could be viewed as a disadvantage to its rival, Junction One. Not so, says Junction One’s developer, John Drummond. He is not even fazed when Trimble talks of Junction One being on the “wrong side of Belfast”, praises Gilford Mill as “something more than a utilitarian bog standard, modern factory type warehouse building just thrown up”. |
Drummond believes an MP campaigning for his own constituency is a good thing, but he says he prefers to get the support of local councils while keeping local MP’s informed. Trimble’s support of Gilford Mill has raised questions, given the MP’s unique position. In fact, many pundits believe he should support both schemes if they are to bring work and investment to the province. |
Trimble hesitates when asked about his support. He says he has had an interest in Gilford Mill since being elected for Upper Bann23 years ago. “I remember mentioning Gilford in my Maiden speech to Parliament, and talking about the potential for redeveloping it. I have a personal attachment to seeing it redeveloped”. ” I think it’s in the right place and the proximity to Sprucefield Shopping Centre all makes sense.” |
Junction One is just off the M22 motorway, north-west of Belfast. Gilford Mill is six miles from the AI, 30 miles south of the same city.
“There’s plenty of room for two schemes. Junction One will be a low-price offer and Gilford Mill more dominant in terms of designer brands,” says Farmer.
Farmer makes an important point by focusing on the type of retailer each developer is seeking.
Getting the right tenants is crucial, especially in a small market like Northern Ireland where, as one agent says, “both developers will be chasing the same tenants”.
Drummond talks about being in a leasing war. “One of the things that characterises a leasing war is misleading information. We only talk about what we have done, and not what we are going to do.”
He claims his scheme is 75% let with” confirmed deals or deals in solicitors hands. Among the list are Levi, Pilot, Logo, Pierre Cardin, Claire’s Accessories, Suits You, Next, Mexx, and Sasperillo.
While Drummond reels off names, Farmer will only release one -Nike, which has signed to take a 9,000 sq ft unit. He also hints that “one of Northern Ireland’s most famous chefs” is to open at Gilford Mill.
Farmer knows he is at a disadvantage by not releasing names, but says he does not want to enter into a battle of words. “I don’t want to break any confidences with major brands that we are in negotiations with,” he says.
So keen are both sides to secure the right tenants that it is believed that a total of up to £9m of incentives have been offered to procure the biggest names.
Whichever opens first will have a definite advantage. Even if the rival developer would not be happy, at least the people of Northern Ireland will have more retail offer. ‘
Accessibility
Pros and cons of both schemes
Both rival factory outlet schemes in Northern Ireland have advantages and disadvantages when it comes to access.
According to John Drummond, being only a few minutes from the M22 and near Aldergrove,
Belfast’s International Airport, gives his Junction One scheme an advantage. He claims it will attract shoppers from all over Northern Ireland and from the Republic.
But agents are dubious as to whether customers coming across the border would go so far north.
John Farmer is also confident of drawing the Republic’s shoppers to his Gilford Mill scheme. He says its location off the Al -the main Dublin to Belfast arterial route and considered the Province’s moneybelt -means it is perfectly positioned to draw on the type of people who will shop at the outlet.
Critics point out, however, that unlike Junction One, which is just off the motorway, Gilford Mill is six miles from its motorway access. And shoppers will have to drive through the congested Gilford Village to get to the scheme.
Farmer acknowledges there is a problem, and says he is working on traffic management with Banbridge District Council and Road Service of Northern Ireland to ease access.
Trimble does not believe access is a problem. “Junction One might be close to the motorway, but it’s on the wrong side of Belfast,” says Trimble. “It is a serious disadvantage to have it north of Belfast because the Antrim escarpment north of the city creates bottlenecks, and communications going north of Belfast are not as good.”
Drummond is not concerning himself with Trimble’s statements, however. For he has other, more immediate access problems to deal with.
Tesco’s Northern Ireland distribution centre is next to Junction One, and the chain owns a small part of the land on which Drummond needs to build his dual carriageway access, satisfying conditions 16 & 17 of his planning permission.
At the time of going to press, Drummond was still in talks with Tesco to purchase the 25m x 200m strip of land.
The situation has sent the rumour mill into overdrive, with suggestions that, if Tesco does not sell, Drummond will have to resubmit his application, holding up the scheme for least a year.
Tesco has refused to comment. Drummond dismisses suggestions of delay as “rubbish”, saying he has another access into the site. “We have an alternative road scheme which doesn’t involve the land owned by Tesco,” says Drummond, adding that he has planning consent for off-site road works.
Drummond has hinted the scheme could open in spring 2004 instead of October.
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Comparing the schemes |
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Promoters of both schemes claim better access, better occupiers and better prospects than their rivals |
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Junction One |
Gilford Mill phase I |
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Size (sq ft): |
150,000 |
140,000 sq ft (phase II will add a further 38,000 sq ft of retail in a couple of years) |
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Location: |
19 miles outside Belfast, just of the M22 |
30 miles outside Belfast, six miles from the A1 |
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Cost: |
£40m |
£28m |
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Estimated Rent per sq ft: |
£25 |
£20-25 |
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Developer: |
Joint venture between CSUP/Kennedy Group/Scottish-based Dunalistair Estates/Guinea Group |
Gilford Nill (A wholly owned subsidiary of Guernsey-based Orana Group) |
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Scheduled opening date: |
October |
Spring 2004 |
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No. of jobs created: |
500 |
500 |
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Political backers: |
Interested in local authority support. Keeps local MP’s informed of developments |
Rt Hon David Trimble, MP and former NI First Minister, and Banbridge District Council |
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Retailers signed up: |
Said to have 75% either signed or in solicitor’s hands |
Said to be in legal procedures with numerous designer names, but has only revealed Nike, and “a famous NI chef”. |
