Glasgow’s prime shopping centres could soon be as much about food and entertainment as they are about shops. Back in the late 1990s/early 2000 it was all about shopping bags, with perhaps a token food offer, as four major shopping centre developments completed: Buchanan Galleries in the city centre; Braehead and Silverburn to the west and south-west respectively; and Glasgow Fort to the east.
Now all four have extensions planned or, in the case of the Fort, under construction, and this time it is very much about increasing leisure offer.
Mike Butterworth, chief operating officer of Capital Shopping Centres, which owns Braehead and has just completed some refurbishment work, explains: “We see the future of successful shopping destinations as being increasingly an exciting mix of flagship retail offers and innovative leisure and catering designed to provide shoppers with the whole day out experience.”
In a nutshell, this trend to extend is about demand and destination. During the recession, consumers have traded down and casual dining of the type being sought for these extensions is very much on the menu. Equally, shoppers need a compelling reason to swap internet shopping for a trip out.
British Land’s Glasgow Fort extension, which is fully let ahead of its opening next year, is only leisure. Dan Clark, senior asset manager, says demand outstripped supply.
“All our existing restaurants were over-trading so we thought there was definitely more capacity. You can’t just sit back and say ‘we’ve built a shopping centre’, you’ve got to create an environment that fulfils what consumers want,” he says.
Silverburn-owner Hammerson is awaiting a decision on plans for a leisure-led extension, although as recently as 2010 the plans were for more retail space. Peter Cooper, director of asset management, says there is a blurring of the lines between retail and entertainment and people want to stay longer, shop, eat and maybe see a film. “Our decision was driven around creating a destination,” he says.
Indeed, it is curious to see that of the four extensions proposed, three are anchored by a multiplex cinema – 29 new screens in total. Not only do they draw the punters in, but they attract the restaurant operators. They are the leisure equivalent to leisure of John Lewis and Marks & Spencer to retail, in that restaurants want to be near them.
“One of drivers on restaurant rents is the cinema. An enormous amount of capital goes into the cinema but it attracts a higher calibre of restaurant operators,” say Clark. “TGI Friday’s wouldn’t have come [to the Fort], I don’t think, if we didn’t have a cinema.”
Likewise, Cooper says having the cinema has enabled them to establish “a good range of restaurants”, both in the existing restaurant quarter of Silverburn and in its negotiations with tenants for the extension.
When these major shopping centres were proposed, there were questions about whether demand from retailers and shoppers would satisfy them. With so much leisure space proposed the same questions are pertinent.
Martin Gudaitis, head of retail for Scotland at Montagu Evans, points to 1999, when Buchanan Galleries and Braehead both opened. “I was handed a file on the Glasgow Fort proposals and I thought then that there wouldn’t be enough demand, but it’s fully let. There is enough business for all these schemes,” he says.
This time, the Fort is the first out of the blocks. Gudaitis says the space in the extension could have been let three times over, which bodes well for the other schemes.
Hammerson is hoping to announce a raft of prelets for Silverburn before Christmas. Braehead and Buchanan Galleries are longer-term prospects and arguably cater for different markets.
“Buchanan Galleries has an upmarket customer base because of John Lewis. It’s got an ABC1, which is quite high for a shopping centre in Scotland,” says John Menzies, partner at Cushman & Wakefield. “Braehead is a fantastic shopping centre but has quite a mass market customer profile. Silverburn has a slightly more affluent shopper, so they are all different.”
John Duffy, director at Colliers International, is putting his faith in the operators knowing their business. “They obviously see that expenditure levels are there and all these locations offer a different product. Obviously, there will be a decision from consumers ‘will I go to the cinema in town or at the Fort’,” he says.
Shopping centres are evolving, there is no doubt about that. Creating a destination with a varied retail and leisure offer that extends dwell times is key and something Glasgow’s retail landlords seem to be enthusiastically embracing.
Glasgow’s retail boom of the last decade proved that if you build it they will come. Let’s hope operators and shoppers have the same appetite for leisure.
GLASGOW FORT, east Glasgow
What 375,000 sq ft shopping park
Who Hercules Unit Trust, in which British Land has a 41% stake
Opened 2004
Extension plans £9m, 45,000 sq ft leisure space anchored by eight-screen Vue cinema
Timescale Under construction and due to complete spring 2013
Lettings Fully prelet. Operators include TGI Friday, Prezzo and Pizza Express
BUCHANAN GALLERIES, Glasgow city centre
What 560,000 sq ft shopping centre anchored by John Lewis
Who Buchanan Partnership (Henderson Global Investors & Land Securities)
Opened 1999
Plans £100m, 400,000 sq ft extension with anchor department store and cinema alongside retail and leisure units
Timescale TIF for Buchanan Quarter has been approved and planning is next stage but construction is not expected to start until at least 2014
Lettings Marks & Spencer is back in discussions to anchor the scheme having dropped out in 2009. Cinema operator Vue has also signed for a 10-screen cinema
BRAEHEAD, Renfrewshire
What 1m sq ft shopping centre anchored by BHS, Primark and M&S also has curling and ice skating rink, Xscape snowdome, cinema and bowling
Who Capital Shopping Centres
Opened 1999
Plans £200m, 440,000 sq ft retail and leisure extension, including department store, sports and entertainment arena, restaurants and cafés
Timescale Pre-planning notices submitted this month
SILVERBURN, south-west Glasgow
What 1m sq ft shopping centre anchored by M&S, Debenhams and Tesco Extra
Who Hammerson & CPP Investment Boards
Opened 1979, extended 2008
Extension plans £20m 212,000 sq ft anchored by an 11-screen cinema and eight leisure units
Timescale Planning submitted July 2012. Completion anticipated H2 2014
Lettings In discussion with operators and it is hoped some deals will be signed before Christmas
Buchanan Galleries extension – TIF greenlight
Last month, Land Securities and Henderson Global Investors (Buchanan Partnership) got some good news when the Scottish government gave Glasgow’s Buchanan Quarter TIF the green light.
The TIF will pay for infrastructure and public realm work around Buchanan Galleries shopping centre, which the Buchanan Partnership is planning to extend (see panel).
LandSec is planning leisure content of around 20% in the extension, a chunk of which will be a cinema.
Next on the agenda for the Galleries is getting planning permission, with an anticipated construction start in 2014.
LandSec’s redevelopment of 185-221 Buchanan Street, next to the Galleries, is 92% let, with a further 7% in solicitors’ hands, ahead of its March 2013 opening.
