The £150m Victoria Gate development in Leeds is already 40 per cent let ahead of its opening next autumn as stores flock to grab a space next to one of the biggest John Lewis stores outside London.
The scheme is being billed as the latest piece in the jigsaw of the complete regeneration of Leeds city centre.
Property developer Hammerson said the 34,300 square metre scheme, which is adjacent to Victoria Quarter, will consist of a flagship John Lewis store, a two-street arcade with more than 30 aspirational retailers and restaurants and an 800-space multi-storey car park.
Hammerson said leasing progress is encouraging, with 40 per cent of the retail income let or in solicitors’ hands.
Construction work for the first phase started last April following the purchase of Victoria Quarter in 2012.
Following hot on the heels of the success of the £350m Trinity Leeds shopping centre, the scheme is expected to create up to 1,000 construction and 1,000 retail and hospitality jobs.
The new anchor John Lewis will be one of the partnership’s largest store outside of London at 255,000 to 260,000 sq ft.
Hammerson said Victoria Gate will be very different to Trinity Leeds, which appeals to a young fashion and mass market audience.
In contrast, Hammerson’s scheme will be pitched at a higher demographic and is aiming for a similar experience to South Molton Street in London, the upmarket pedestrianised street south of Bond Street in the heart of London’s West End.
Hammerson said that John Lewis will bring in shoppers who don’t currently shop in Leeds in what is widely known in retail terms as “the John Lewis effect” as the store is so popular with shoppers.
Hammerson has already signed up some upmarket retailers for the arcade, but the names will not be announced for another few weeks. The group is also asking existing retailers in the Victoria Quarter, which include Ted Baker, Vivienne Westwood, Karen Millen, French Connection, Diesel, Space NK, Hobbs, All Saints, Jigsaw and the first Harvey Nichols store outside London, if they would like to move to bigger premises at Victoria Gate.
Victoria Quarter is ornate, but very small, and Hammerson believes retailers may well grasp the opportunity to up-size to a larger store in Victoria Gate.
The new Victoria Gate retail space will be positioned between Harvey Nichols and John Lewis.
ACME designed the architectural plans for the scheme that pay homage to the Grade II listed, Frank Matcham-designed, Victoria Quarter while also creating a modern building.
The scheme is being billed as a 21st century-inspired retail arcade.
Plans for the eight-storey white Terracotta building include a roof inspired by the Corn Exchange, but with the contemporary reference of the new, highly acclaimed Kings Cross station in London.
Announcing annual results yesterday, Hammerson said the UK economic recovery had helped it to more than double profits.
The group’s pre-tax profits jumped 106 per cent to £703.1m in the year to December 31.
It posted a 2.1 per cent rise in net rental income following strong demand from retailers who want prime space in its properties.
The business has benefited from the 2013 strategy of chief executive David Atkins to withdraw from its London office buildings and focus on retail outlets in order to take advantage of the UK’s consumer led recovery.
The FTSE 100 firm said its property portfolio gained from a revaluation gain of £547m, equivalent to a total return of 13.6 per cent.
Mr Atkins said: “We have delivered strong results on the back of a significant uplift in asset valuation and continuing income growth.
“The recovery in UK consumer sentiment has continued to strengthen, driving increased demand from retailers for prime space, which is now translating into estimated rental value growth across the whole portfolio.”
The company said it has raised £1bn of new cash to fund expansion.
Its biggest UK tenants last year were B&Q, Next and Dixons Carphone.
Written by Ros Snowdon City Editor, for The Yorkshire Post