Quality projects boost the marketImproved offer Liverpool’s retail is set for a transformation as
schemes move forward.
The long-awaited Paradise Project is now under way in Liverpool, and
the sight of cranes overhead is leading to rising expectations that the
£800m Grosvenor scheme will breathe new life into the city’s
struggling retail market.
Landmark stages in the development’s construction, such as its
first multi-storey car park and the city’s new bus station, are
about to be reached. Both will be unveiled next month.
The timetable for the remainder of the Paradise Street development area,
which occupies some 42 acres, will see the first phase opening in 2007
as part of Liverpool’s 800th birthday celebrations. And the project
will be completed in the summer of 2008 ‘the year the city takes
on the prestigious role of European capital of culture.
Marketing Campaign
The marketing campaign is due to begin next spring. Before then,
a number of key cornerstones are expected to have been put in place, including
lettings to major space users, which range between 20,000 sq ft and 35,000
sq ft.
Claire Cooper, head of retail leasing with Grosvenor, says that heads
of terms are already being agreed for eight out of the 10 major space
users. She cannot provide names yet, but confirms that they are ‘very
much the high-street names that take large spaces’.
Cooper adds that several are existing city occupiers that need more space,
but others are newcomers. They are mainly fashion operators but, she stresses,
no exclusively.
The mixed-use scheme, which totals 2.5m sq ft, includes 1.65m of retail
space, anchored by Debenhams and John Lewis. It has been designed to offer
a number of ‘quarters’ with distinct environments. South John
Street will be a two-level mall with standard units of between 2,000 sq
ft and 3,500 sq ft, aimed at high-street fashion and other occupiers.
Paradise Street itself will be a wide, European-style boulevard’.
Says Cooper, aimed at a market that is ‘young, urban, edgy and label
orientated’. Shop space there will range between 1,500 sq ft and
7,00 sq ft with capacity to accommodate flagship stores.
Peter’s Lane will comprise arcades and narrow streets. Smaller,
boutique-style units of between 1,000 sq ft and 2,500 sq ft will be pitched
at what Cooper calls more inspirational fashion retailers. Hanover Street,
meanwhile, will accommodate homeware retailers, cafears and possibly a
supermarket.
Cooper says a key part of Grosvenor’s marketing strategy is to
put in place a sample of the types of retailer that suit each area, so
would-be occupiers know here they should locate themselves.
She explains that there are slight variances in rental levels between
the different districts. South John Street will see prime rents, while
Peter’s Lane, for example, will be set at a lower level. Cooper
reckons that, although some rental growth is expected by 2008, prime rents
will be somewhere near the city-centre’s current range of £300-£315
per sq ft.
Many in the Liverpool retail market expect Grosvenor’s Paradise
Street to play a pivotal role in helping the city to change its retail
fortunes. Liverpool’s prime pitch is very short and, by common consensus,
there is an abundance of space that does not suite modern retailers’
requirements.
Peter Burke, retail partner with Mason Owen, says retailers in the city
that want to expand face a real problem. ‘Paradise Street, however,
will give the opportunities for them to do that,’ he says.
Aspirations fashion
Bid space is not the only thing holding Liverpool back. Quality
names are lacking too. ‘Retailers, such as womenswear company Cricket,
trade very well,’ says Cooper. ‘But inspirational fashion
is gene3rally not there at the moment. In a city comparable to Mancheser,
you would expect to find names such as Jigsaw, Hobbs and LK Bennett.’
Research by Gerald Eve pinpoints the same gap in the market. Dominic
Allport, the firm’s research associates, says, ‘In contrast
to the mass-market offer, Liverpool is decidedly underserved in the quality,
upmarke3t and speciality sectors.’
Preparing to fill that gap is the Met Quarter, which will open for trading
next March. Milligan’s 130,000 sq ft redevelopment of the former
post office in Whitechapel is combining a mix of designer brands and upmarket
high-street names.
Armani, Flannels and Hugo Boss, which committed to the £75m scheme
some time ago, have been joined more recently by the likes of Hobbs, Whistles
and Coast. Gieves & Hawkes has also just signed up for a 2,000 sq
ft unit. And deals are about to be secured with toiletries firm Molton
Brown, clothing retailer Animal and Cafouge.
Melanie Taylor, head of leasing for Milligan, says of Gieves & Hawkes’
signing: ‘It had experience of trading in Leeds and saw Liverpool
as being a not dissimilar catchment.’
Speaking of reactions to the scheme, Taylor adds: ‘The vibes have
been ‘it’s about time too’. It is time Liverpool underwent
a transformation in its retail offer It’s almost as f it has been
short-changed for too long. It has a fantastic catchment, but Liverpool
has not been able to give it the flagship stores it deserve.’
Taylor believes that, while the Met Quarter, Grosvenor’s Paradise
Street and the existing Clayton Square shopping centre ‘ which was
recently acquired by Land Securities ‘ will have different offers,
they are all ‘pulling in the same direction’.
And John Agnew, now a director of Savills after the firm’s purchase
of SY Moorhouse Wright, and joint agent on Met Quarter with Markham Vaughan
Gillingham , says ‘If Met Quarter is a success, and it look as if
it will be, it bodes well for Grosvenor. It gives a glimmer of what Liverpool
can do. And Grosvenor can then pick up the baton and carry on.’
Liverpool is now appearing or, in some cases, reappearing on retailers’
radar screens. Gary Crompton, senior retail surveyor with DTZ, says: ‘Quality
retailers such as Habitat, which previously left the city, will now reconsider
Liverpool.’
Tim Kenney, co-founder of Chester-based Kenneymore, says the mood in
Liverpool is buoyant. He has just started marketing, on behalf of Quintain,
the 20,000 sq ft former Wade Smith premises, alongside the Met Quarter
development. The space, he says, could be re-let as retail, but could
also accommodate leisure.
Of the adjoining Met Quarter, he says: ‘Anchored by the tenants
that it has, it will be very much a niche market. Liverpool has proved
it is not shy when it comes to parting with its cash, and the Met Quarter
is the very embodiment of that.’
Mason Owen’s Burke, who describes the development as ‘very
impressive’, says its line-up of occupiers will help to fill a ‘void’.
Gerald Eve believes schemes such as Paradise Street and Met Quarter are
expected to ‘greatly improve the standing of the city and enable
it to reclaim a genuine regional shopping role’. The firm’s
survey, which gives a rating based on factors such as floorspace and overall
attractions, sows the city is already beginning to close he gap with Manchester.
Gerald Eve believes the new investments will mean shoppers will no loner
have to go to Manchester and Cheshire. Mason Owen’s Burke concurs:
‘Leakage will fall away.’