Demand from fashion retailers for space in Glasgow’s Buchanan Street has morphed the city’s traditional core retail zone, according to Savills.
The agents says that the city’s retail area – which traditionally formed a ‘Z’ shape along Sauchiehall Street, Buchanan Street and Argyle Street – has now become more of a fashion-led ‘I’ as the main retail artery has claimed a dominant position.
The agent points to resilient headline rents on Buchanan Street, which have remained stable at £260 per sq ft.
This compares with Sauchiehall Street and Argyle Street where there has been downward pressure on rents, which have traditionally been £163 per sq ft and £170 per sq ft respectively.
In addition, the higher vacancy rates in these two streets means that larger incentive packages have been required to secure retailers, which have recently been less fashion orientated, such as Greggs, Argos and HSBC.
Savills retail director, Estelle Forrester, says: “Driven by an increased appetite from fashion brands, Buchanan Street has really come into it’s own in recent years.
“This remarkably robust demand from an industry that remains resilient has generated a shift in the entire shape of Glasgow’s core retail centre and helped Buchanan Street to attract a strong and continuous footfall.
“Buchanan Galleries and St Enoch Centre also act as stable weights at either end of the street.
“The high street retail offer in Glasgow has evolved substantially over recent years with out of town competition and the forthcoming St Enoch extension.
“This, combined with challenges in the wider economic climate, has had a significant impact on the high street core, which is emphasised by the increasing void rates on Sauchiehall Street and Argyle Street.”
Looking forward, while Argyle Street has arguably suffered more, Savills forecasts that this area is set to benefit from St Enoch’s extension, which is due to be completed in early 2010.
The scheme is expected to enhance the footfall from Buchanan Street into the centre and entice it back along Argyle Street with a flagship H&M and Hamleys store.
In addition, Marr Properties is seeking to redevelop the former Tesco’s and Curry’s Digital unit for TK Maxx, which has signed for a 90,000 sq ft store.
Retail director Ross Allardice adds: “There is no doubt that St Enoch’s will rejuvenate Argyle Street in the short term, however, for this to be sustained, it is crucial for landlords to take a long-term view regarding the tenant mix.
“This will also be paramount to the revival of Sauchiehall Street, which needs to adapt to the changing demands of the market by focussing on a more non-fashion, value-led pitch that will complement rather than compete with the surrounding retail area.
“Fundamental to the rejuvenation of Argyle Street and Sauchiehall Street is flexibility from the council in terms of planning to allow alternative uses such as banks, coffee shops and restaurants to generate a much needed variety and allow both areas to re-establish their position as part of Glasgow’s prime retail hub.”
