More than 600 retailers want to get into Nottingham, according to CB Richard Ellis. This is a much-touted statistic among agents in the East Midlands capital. Indeed, developer Westfield presented a weighty A-to-Z listing of those interested retailers to the council to help it win the CPO inquiry into the £400m redevelopment and extension of the Broadmarsh Centre (see panel).
But if that’s the case, why have a number of vacant units on a street that attracts prime rents sat on the market for the best part of a year? Especially since the city’s lack of good space is said to have been a problem for years.While space in new developments (seepipeline, opposite) does seem to be letting, why hasn’t there been a spate of lettings on the prime pitch?
Admittedly, retailers have been going through a tough time, registering the weakest start to a year since the British Retail Consortium started conducting surveys in 1995. The specific problem for the city centre seems to be the “wait and see” attitude that has set in, as plans for Broadmarsh inch forward.
But they will be waiting a long time. Broadmarsh is not scheduled to open its doors until 2009. Surely the who’s who of retailers that are claimed to be bursting to get into Nottingham city centre would opt for a small slice now, in a bid to get exposure to the 240,000 shoppers that pour into the city each weekend in search of the latest fashions?
Clumber Street is a case in point. Once labelled the busiest thoroughfare in Europe, it provides the main arterial route between Capital Shopping Centres’ Victoria Centre in the north and the Broadmarsh Centre in the south. It attracts prime zone A rents, which local agents place at £250 per sq ft.
However, over the past eight months, five units have come onto the market and just sat there. Units available include those of Pilot; Allsports, which went into liquidation in September last year; and River Island, which is relocating to the Superdrug shop on Lister Gate.
Another source of gloom is the former Etam unit at 49-51 Clumber Street. Ben Tebbutt, partner at Fisher Hargreaves Proctor, says the store failed to generate much interest when available on the open market. Following refurbishment, it is now trading as Miss Selfridge. Similarly, he says of Must Have IT: “Its life on Clumber Street was shortlived. The unit is now available.”
Part of the problem is what Tebbutt calls the street’s “mainstream appeal”. What he is too polite to say is that the street was once a bustling thoroughfare but has now been taken over by a clientele more associated with downmarket hoodies than high-end fashion. As a consequence, cutting-edge retailers have taken flight to the more rarefied atmosphere around Bridlesmith Gate.
Charles Trafford, associate at Innes England, agrees. “It is an interesting experience walking down there at the moment, but I wouldn’t say Clumber Street is in trouble. We are now in the new year, retailers are assessing their needs, and the vacant units will go.”
Indeed, there have been lettings. In the Victoria Centre, new tenants including Monsoon, Republic, Top Shop and Charles Clinkard have all signed up. Bridlesmith Gate added Molton Brown, Mikey and Phase 8. And One Fletchergate secured Two Seasons and Savills.
Tim Hance, joint managing director atLeslie Furness – agent for One Fletchergate – says unit four of seven is under offer to a national hairdresser. Although originally pitched as an outdoor-wear/extreme sports retail location, “we are turning it into more of a restaurant location”, he says, adding that Strada, Carluccio and Giraffe are interested.
But retailer hesitancy has taken its toll on rents. Despite Colliers CRE recording rental growth of 4.9% for the East Midlands – the second best performing region in the UK – Nottingham’s zone A notched up less than half of that growth, increasing £5 per sq ft to £230 per sq ft. This puts it on a par with Reading but far below other top centres, such as Birmingham or Manchester.
Neither Tebbutt nor Trafford expect much rental growth. Increases, they say, will be at the pounds and pence level. “Rents can’t go through the roof overnight,” reasons Tebbutt.
Westfield, Broadmarsh’s developer, is cautiously optimistic. “£250 is good but we would like to move it on,” says development director Peter Miller. “We’re fairly sure that between now and opening, zone A rents will have moved on, and we will be dictating the prime pitch level; but we won’t be the only place,” he adds diplomatically.
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The race for anchor tenants is on as new schemes vie to sign up department stores. As one agent puts it: “It’s crunch time.” Ben Tebbutt, partner at Fisher Hargreaves Proctor, says a power struggle has broken out between the Victoria Centre and Broadmarsh, which is keen to take away the former’s crown with its £400m redevelopment. Debenhams and House of Fraser are expected to be top of the centres’ wish lists. Debenhams trades from an outdated store overlooking Old Market Square, while House of Fraser trades from 60,000 sq ft at the northern edge of the Victoria Centre and has a longstanding requirement for 100,000 sq ft unit in the city. Peter Miller, development director at Westfield, agrees that the first port of call will be signing anchor stores, and says he hopes to have a few names in place by summer. Westfield will then launch into its leasing programme in the autumn. But he plays down competition between the two centres: “I don’t believe we are going head-to-head. The city council message is clear. Broadmarsh is a priority for them and, in terms of regeneration, there is only one scheme happening in the medium term.” Agents believe the owner of the Victoria Centre, Capital Shopping Centres, is negotiating with both House of Fraser and Debenhams about extending its 956,000 sq ft scheme into the bus station to provide them with stores of 120,000 sq ft each. CSC remains tight-lipped about the proposals but has started a feasibility study for the north end of the scheme. Miller, however, has his own view: “I am not aware that there is anything in the wings at the Victoria Centre.” Heal’s – which has made it well known that it has a 25,000 sq ft requirement for the city – is thought to be off the list, with reports that it has taken a unit in Bildurn’s 55,000 sq ft The Pod on Fletchergate. The Pod’s developer will not confirm the rumours. “We are in talks with retailers but we can’t comment on specifics,” says a spokeswoman. |
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2006 One Fletchergate Previously called The Edge but now being marketed as One Fletchergate. Provides 101 flats and 20,000 sq ft of retail and leisure. 2006 Axis The former Co-op department store on Upper Parliament Street. The retail and leisure element is already let and the rest of the 220,000 sq ft mixed-use scheme should be ready by spring this year. 2007 Trinity Square (pictured) £100m scheme. TK Maxx, Borders and Dixons have signed for 90,000 sq ft – half of the total planned. 2007 The Pod Construction is now under way to deliver 55,000 sq ft of retail. Ibis signed a prelet for a 142-bed hotel but no retail lettings have yet been finalised. The marketing campaign will get under way this summer, says developer Bildurn. 2009 Broadmarsh extension Westfield’s 500,000 sq ft extension to the Broadmarsh centre cleared its CPO inquiry with no objectors present. It expects to get the go-ahead from the government in the next few months. Relocation of some offices has already started as has investigative work. Once the official nod is given, Westfield say it will be all systems go. |
