After years of missteps, discord and occasional hostility regarding the city’s retail plans, harmony appears to be breaking out at last in Nottingham.
Landlord Intu Properties’ proposals for both the Victoria Centre and Broadmarsh are taking shape in accordance with the wishes of the local council, while retailers appear to be happy with the news, following more than a decade of uncertainty.
This apparent Zen-like state has come about following Intu’s agreement with Nottingham city council for delivery of Broadmarsh and the Victoria Centre, signed in January. The local authority has a 33% stake in the former, which is key to broader plans for the regeneration of the city’s southern gateway.
The council’s determination to see work on Broadmarsh begin before an extension of the Victoria Centre takes place is a key part of the agreement. It also contains a number of key milestones (see graphic).
Graham Chapman, deputy leader of Nottingham city council, has previously been exasperated by the lack of progress at Broadmarsh, which was bought by Westfield in 2000 and sold to Victoria Centre owner Capital Shopping Centres – now Intu – in 2011 without any significant redevelopment having taken place during the intervening period.
But his tone these days is warmer. While acknowledging the potential dangers of having one developer controlling virtually all of the city’s prime retail, Chapman believes this is better than two opposing schemes.
“It was quite exhausting dealing with that rivalry and we got nothing in the end,” he says.
“Now Intu has a stake in the whole of the city and this means we get some mature thinking from them. We want a partnership, and on this basis we can now get one.”
The developer is already on site with a £3m refurbishment of the Victoria Centre. Martin Breeden, regional director at Intu, says this has helped provide certainty to retailers, as evidenced by lettings to Office, Superdry, River Island and Urban Outfitters in recent months.
“We didn’t see any reason to wait with the Victoria Centre,” Breeden says. “It has taken some time to get an agreement in place with the council, so in the meantime, why wait? Our view was to press on.”
The development of two separate malls raises questions over differentiation, but Breeden stresses that they will be complementary. “The Victoria Centre will be the prime fashion pitch. Broadmarsh has scope for a cinema and a strong catering line-up, alongside a mainstream high-street offer and some speciality independents,” he says.
Agents believe that Intu’s ownership of both centres will allow it to dictate the rental tone more easily, delivering a long-term rental upturn. Nottingham’s prime zone A rents of around £220-£230 per sq ft mean the city lags behind the likes of Birmingham and Manchester.
“The recent lettings strategy at the Victoria Centre, focusing on fashion, has been pretty successful,” says one agent, who prefers not to be named. “Redeveloping Broadmarsh as a leisure and mass-market destination off a lower rental level will allow Intu to move the Victoria Centre upwards in terms of rental growth.”
Breeden is understandably keen to avoid creating the impression that retailers can soon expect a hike in rents. However, he admits there is a potential for “sales growth”.
“What you have to do is generate a great destination for consumers, push sales and turnover for retailers, and then rental growth comes from that,” he says.
The council, meanwhile, is hoping the redevelopment of Broadmarsh will have wider positive implications.
“It’s not just about wanting a shiny city centre,” says Chapman. “We want to see the scheme promote development in the south of the city so we end up with two healthy centres that increase footfall and jobs.”
Northampton
For most council leaders, losing the developer of a major city centre retail development would be a disaster.
Not so in Northampton, where council boss David McIntosh says he is “pleased” that the council can move forward with the redevelopment of the Greyfriars bus station site unencumbered by former development partner Legal & General’s involvement.
“It is time to deliver the improvements that people have been waiting for years to see, which will strengthen Northampton’s retail offer and keep more spend in the town,” he says.
L&G walked away from a proposed extension of its Grosvenor Centre onto the 4-acre Greyfriars site in July, citing concerns over planning approval at inquiry for LXB Properties’ out-of-town Rushden Lakes scheme.
Its £10m investment in the Grosvenor Centre is unaffected and recent lettings to Next and Primark are in place. But these deals could be problematic for the council’s standalone Greyfriars scheme, says William Nelson, director at retail and leisure specialist McKinnon Nelson.
“With Next and Primark elsewhere, there is a question over whether the council’s site will be able to achieve the mass to offer anything very exciting from a retail perspective. ” he says.
The council has set a start date of next autumn, subject to planning. Demolition is under way, with a cleared site ready to be taken to market in December.
