Retail Day
Retail Week, today
Archive for the ‘Property’ Category
Core blimey
The opening of an Apple store never fails to amaze me. There is almost a cultish feel to the way the staff all stand by the door and applaud customers in, occasionally making weird howling noises like wild animals. All very odd but seems to work and its first store in the city was certainly drawing the crowds at the opening of the extension to Eldon Square in Newcastle this morning.
The problem with Apple is that it tends to take over a shopping centre opening, and so today the queue barriers where shoppers were waiting to get in were getting in the way of everyone else getting to the other shops in the extension. That was causing a little bit of friction, but minor and very temporary niggles aside this was a very good opening day and has brought some very great stores and new brands to the city.
Aside from Apple and Paperchase the extension is very fashion focussed and features a very good Debenhams store with particularly strong looking home and beauty areas, plus most of the Arcadia brands, River Island, New Look, Superdry, Republic, All Saints etc etc. Debs didn’t have a store in Newcastle before, which is extraordinary, and their retail director Nigel Palmer told me they’d been trying to get in for 15 years. They’ve arrived in style and were doing very well today.
Among the interesting things I saw was a new look for Miss Selfridge, which is rather tucked away on the upper floor of a store shared with Dorothy Perkins and Burton, but borrows more than a bit from Anthropologie. Ian Grabiner was there and looked pleased with the work, which he’s brought in David Dalziel from Dalziel & Pow for after his successful work for Topshop. Topshop and Topman share a good-looking store across the way, hampered only by the lengthy walk back upstairs from the Topman basement - there’s no up escalator.
The problem with extending shopping centres is it always shows up the weaknesses of the old part, and that’s certainly the case with Eldon Square. Its owner CSC is planning a rolling programme of smartening up the older parts of the centre and that’s certainly badly needed, as parts of it look dated and shabby. It’s always going to be a hard centre to manage though because of its sprawling nature. While on that subject, can anyone enlighten me as to why one part of it is called Chevy Chase?
I know this its sacrilege to say this to a Geordie, but I popped into Fenwicks and wasn’t over impressed. There was a really odd mix of merchandise by the main entrance and quite a lot of empty shelving, and a lot of the rest of the store looked pretty tired, like a John Lewis that hasn’t been done up in a long time. I know it’s Newcastle’s department store, but I got the sense the John Lewis across the way must be giving it a run for its money.
Chim Chimney….
We had business mininster Lord Mervyn Davies speaking at Retail Week’s 100 Club last night at the Ivy. Davies is unusual in not being a career politician - he was a non-exec at Tesco and ran Standard Chartered Bank - and was impressively frank with his views on the economy and the election.
I didn’t agree with a lot of what he said though and he seems to have a massive chip on his shoulder, bizarrely blaming the media for all the country’s ills and saying that there was no real reason to worry about the economy or the public finances.
That didn’t wash at all with our audience of retailers, who gave him a right going over in the Q&A, with Superdrug boss Jeremy Seigal, who I’d previously thought of as a mild-mannered sort, leading the charge like a man possessed.
Interestingly none of the questions were about retail specifically, but more on the national defecit, public sector pensions and credit insurance. Davies’ answers didn’t do much to win the audience over, along the lines of “I agree but what can I do about it?” George did a good job just to control the debate, otherwise we’d still have been there for breakfast.
This morning I’ve combined two of my favourite things - walking around the City of London and walking around building sites. I was with Land Securities looking at its One New Change development, which sits dead opposite St Paul’s and has attracted retailers like Topshop, M&S and Next, with Banana Republic rumoured to be signing too.
Regular readers will know I’m a bit of a London obsessive and few sights are more likely to put a smile on my face than walking up Watling Street towards St Paul’s, particularly as it’s getting dark. It always puts me in mind of the film Mary Poppins, probably because of the ‘feed the birds’ scene on the steps of St Paul’s. Anyway, the new scheme sits between Cheapside and Watling Street, directly facing the Cathedral, and is going to have some pretty amazing views of it, particularly from its rooftop terrace which will have a restaurant.
In what will be a first for the City, seven-day trading will be a condition of the leases, which may raise a few eyebrows given how quiet the area has traditionally been at the weekend. But with all the tourists heading to St Pauls and Tate Modern, plus the success of Canary Wharf having shown that office areas can become weekend shopping districts, it has a good chance of succeeding.
Out with the old, in with the Newton-Jones
A very enjoyable evening last night at a dinner hosted by Shop Direct Group at Soho House. Shop Direct is of course the company a lot of people still call Littlewoods, but the Barclay Brothers-owned business has been moving at breakneck speed to transform itself from the dowdy catalogue and store business of old to a company where, at Christmas, 65% of its orders were being received online.
That transformation is being driven through by energetic Brummie Mark Newton-Jones, and inevitably is not without pain. Last week the company announced 1,500 job cuts in its call centres, a sad but inevitable function of people now ordering less by phone and more online. And it’s important to point out that the results of the changes still need to feed through into profitability.
Nevertheless, the business would be in a much worse state were it not going through these changes and bold moves like buying the Woolworths brand and renaming Littlewoods Direct as Very are the sort of things the company needs to do to ensure it remains relevant to a new generation of customers.
Shop Direct is keen to be seen as a leader in the online sphere, hence the dinner where there were talksfrom Google’s very engaging UK boss Matt Brittin, who I was fortunate enough to be sat next to, and a very unassuming chap called Liam Wood, who runs an online business called Enviro Lights, selling eco-friendly lightbulbs, having successfully launched a business selling hoover bags with his brother which now turns over £1m a year.
His tale was instructive. He worked in Morrisons while his brother ran a small shop selling vacuum cleaner bags in Derby. But the cost of rent and rates, combined with the threat to his footfall posed by the city’s new Westfield centre, meant his brother realised online was a better place to be and where he could develop a much broader reach for his brand, which he has successfully done through his site dustbag.co.uk
Now the brothers are aiming to launch a new site every year, with the lighting site already managing £200k in sales. These very modest entrepreneurs are a great example of the opportunities the web opens up to people who’ve spotted a niche in the market to reach many more customers than one shop ever could.
Manifestly correct
Today Retail Week launches its Manifesto for the High Street, our attempt at making a constructive contribution to the debate on the future of the UK’s shopping streets. There is clearly a massive issue, because empty shops and an abdication of responsibility from the politicians have meant that many of the UK’s shopping areas are looking particularly forlorn.
Politicians, both local and central, have traditionally assumed that their town centres can look after themselves, that new retailers will replace those that have closed, and that the shoppers that stores attract will ensure the town centre is a dynamic and busy place.
They’ve been asleep on the job, ignoring the impact of both the recession and the rise of retailing both online and out-of-town. And with vacancy rates soaring to 20% and beyond in some places, the need for action now cannot be ignored. There are some low-cost and relatively easy solutions, and with a general election looming, there’s no better time to bring this to the attention of the politicians - we’ll be sending the final manifesto on to all three parties once we’ve incorporated all the feedback to the version we’ve published.
I’d love to hear your views on the manifesto page of the website.
Last night it was the Drapers’ Etail Awards, hosted by the fragrant Claudia Winkelman at the trendy Bloomsbury Ballroom. It had been a long day, having been up since 5am for the BBC, but I bravely soldiered on and it was a great evening, with discount sportswear site M&M Direct sweeping the board. Its very likeable boss Steve Robinson - who I believe has on more than one occasion been compared to actor Jim Carey - was on the slopes unfortunately, but buying director Neil Sampson made it just in time after a mad dash from Heathrow to collect the awards.
Etailers are generally fun - they’re all quite young, and in the fashion world at least, an appealing mix of geek and glamour. Certainly they were partying hard and I’m flagging today, although have been perked up by an excellent lunch with David Carter-Johnson of Adams fame, who is setting up a new venture to help struggling retailers. More of that next week. We were at Quo Vadis and Michael Winner was sitting just behind us, with three blondes.
Oracular spectacular
I was in Reading yesterday and had a spare half-hour before going down to Waitrose HQ so I had a stroll round the shops. The town is undeniably unglamorous but has I’ve always really liked its shopping centre, the Oracle. I hadn’t been down for a long time though so was interested to see how it was faring in the recession.
I shouldn’t have been worried, as although the centre is celebrating its tenth birthday this year, it still looks really strong. I could barely see any empty units, and most of the retailers seem to have kept investing in their stores (with the notable exception of Debenhams, which still sports a very 1999 giant D on the outside). The centre was busy too.
What I like about the Oracle is the way it combines retail and leisure probably more effectively than any centre in the UK. Topographically the interior of the centre isn’t ideal - lots of different levels - but that seems to work OK and the riverside leisure area, while unashamedly mass market, is one of the few shopping centre environments which genuinely creates somewhere you’d like to stop and hang out, especially on a sunny day.
It’s the sort of thing we’re going to have to see more of in the next generation of shopping centres. An old-style food court isn’t going to be enough - growing dwell time will require the creation of more genuinely pleasant environments.
On a separate note, anyone know why its called The Oracle?
Victoria’s secret
In Yorkshire over the weekend at a wedding and visiting sister at uni, and inevitably I managed to engineer an hour to spend walking the shops of central Leeds before catching the train home. Within a very small area Leeds manages to show off both the best and worst in UK retail.
The best is the Victoria Quarter, the network of arcades which is home to Harvey Nichols and a collection of other upmarket brands. Walk in there on a wintry afternoon as it’s getting dark, and it feels not only incredibly festive but also as though the recession never hapenned. It was packed yesterday and I couldn’t see any empty shops; proof perhaps that if you create the right retail environment shoppers will still come.
The Harvey Nics in Leeds is to me the best of the stores the luxury London department stores have opened in the regions. It suffers a bit from low ceilings and lack of room to circulate, but that doesn’t seem to matter as it has a buzz and an energy about it which is really refereshing. You can’t say that about some of the other stores HN, and indeed Selfridges, have opened.
The city centre’s mass market retail offer is in a bad way though. It boasts a collection of very sub-optimal shopping centres like the Leeds Shopping Plaza, the Merrion Centre and the St John’s Centre, packed with low-grade value stores, all of them really badly configured. Weirdest of all is the old Headrow Centre, now renamed as The Core, where the redevelopment appears to be complete but only about three stores - Sports Direct, HMV and New Look, oddly on its own on the first floor - appear to be open. Anyone know what’s going on there?
We don’t really need more shopping centres in the UK, but Leeds is the exception, so that retailers can get their hands on decent sized stores with the right floorplates. Both Land Securities and Hammerson have schemes on the block, with the LandSec scheme having marginally the better site - but for the good of the city, work needs to start sooner rather than later.
Grim up north
Looking out over a rainy Stockport, on train back from BCSC. The miserable weather here in the north-west has been an appropriate backdrop for the annual retail property jamboree, which in keeping with the times is a lot lower key this year than it has been in any of the previous four I’ve been to.
I’m missing the big night tonight but apparently there are far fewer parties this year. Indeed the legendary agent, Sports Direct director, Spurs fan and all-round bon viveur Malcolm Dalgleish told me he doesn’t have any invitations until the Land Securities party, which - showing that some things don’t change - doesn’t start until 11pm. Times have definitely changed, although I suspect the bar of the Midland will still be doing a very healthy trade tonight, it certainly was last night.
Although one or two of the main players cut back on their stands this year, nearly all the usual suspects were there in force and over 2,000 delegates was an excellent turnout for the BCSC, headed by the indefatigable Michael Green. They got the tone just right, with the conference introduced by the development director of John Lewis, Jeremy Collins, who is very, erm, John Lewis, and chaired by the very John Lewis former chairman of the John Lewis Partnership Sir Stuart Hampson.
JLP is certainly the bridge between the property and retail sectors, helped of course by the fact they generally don’t have to worry about the minor matter of paying rent. I sat down with Jeremy last night and interestingly he accepted that the model is likely to have to change when the development market comes back - “we’re going to have to meet in the middle” he said, which was an interesting recognition that the shopping centre world is not going to go back to what it was.
The speeches this morning were pretty sobering stuff. Michael Portillo was as urbane and funny as you’d expect but was also as gloomy as anyone I’ve heard on the economic prospects for next year, while as the sole retailer on the programme Peter Williams did a good job of getting the industry’s messages across to the property world. You can read my story on their speeches here and my column on the conference here.
Shirts on Sale
A lot of coverage over the past few days for TM Lewin, which delivered impressive sales and EBITDA growth in the year to February. A very good performance, reflecting the extraordinary shift that Lewins and indeed the other Jermyn Street shirt retailers have made from being exclusive and rather sniffy upmarket brands to being accessible yet aspirational.
The company’s chief executive Geoff Quinn is notable for two things - firstly, as every article written about him always says, is that he left school with one O-Level in pottery, and secondly that if his retail career ever falls upon hard times, he could easily forge a career as a double for Tony Blair, as his looks and mannerisms are uncannily similar. The company’s FD Mike Trotman is a nice bloke, and lives round the corner from me in Herne Hill (although in a much nicer street than me, naturally). Mike, who used to be FD at Hobbs, does a good impression of being pleased to see me when we bump into each other on the train, as we occasionally do.
The question I’d like to ask Geoff is not about his O level in pottery, however, but when his business last sold a shirt at full price. I popped into their Kings Road branch yesterday on my way to the Bridge (Chelsea beat Man U 1-0 in case you’d not noticed) and their addiction to 3 for 2 offers, half price on everything and all the rest would make even Debenhams blush. Hawes & Curtis down the road was the same.
It all seems to be doing a good job in shifting shirts, but the concept of a Jermyn Street shirt must be being devalued with the cut-throat battle going on between these companies. Still, it’s delivering results for the owners and that’s what matters to them, and also means that men who might othwerwise shop at M&S end up sporting a rather smarter shirt.
On the way to Manchester for the annual retail property jamboree, the British Council of Shopping Centres. It’s the only event I know where you get invitations to Tuesday night parties which start at 11pm. Times must be changing for the pastel-shirted men from Mayfair, as I’ve seen a load of well-known agents trudging down the platform to second class, which would never have happenned in the old days. I’ll report back tomorrow.
Cross with a crossing
Been to see two great stores today.
I was in the West End for lunch with Guy Hipwell, Liberty’s very likeable head of supply chain and e-commerce, who is a good friend of RW and also I’m pleased to say a regular reader of this blog. Liberty was looking stunning as always, with a really interesting collaboration with Rolling Stone Ronnie Wood - who’s discovered his arty side - catching the eye on the ground floor and a great Christmas shop on the fourth. The windows good too, especially one which reverses the traditional boxing day hunt by having the foxes eating Christmas dinner, and I went away feeling thorougly festive.
While in the area I also went to see Anthropologie, which I’d been meaning to do for the past week. It’s stunning, a brilliant addition to Regent Street. John Ryan wrote a feature on it last week which is well worth a look, but I would definitely flag up the living wall, which really is an extraordinary feature to put into such an old building, and the amazing standards of design and VM across the piece.
Only thing I struggle with is putting my finger on who exactly who the target customer is - womenswear is the bulk of the offer but there’s a big home element too. It feels like an Urban Outfitters for grown ups, not surprising given that they’re part of the same empire. The pricing is high and there may be some work to do to get the uninitiated London shopper into the brand, but it’s a wonderful store and I hope it succeeds here.
The only bad thing about my trip was the Oxford Circus diagonal crossing, which caused all manner of excitement in the press yesterday. I crossed it four times in the pouring rain to test it for Retail Week’s readers and I’m sorry to say I spotted a flaw. The problem is that even when it’s not busy, which it wasn’t at 12 o clock today, when people from the four corners meet in the middle they all get in each other’s way.
It may work in Japan, where people tend to go about things in an orderly fashion, but at Oxford Circus everyone seemed to be walking into each other, which when they all have umbrellas up, is a recipe for chaos. Hopefully we’ll all get used to it.
Olympic dreams
I’ve always been an enthusiast about the Olympics coming to my home city - then again I was just about the only person who excited about the Millennium Dome - so I was keen to go and have a look at the Stratford site, which I did on Friday. The reason wasn’t so much the stadium itself, but the giant shopping centre Westfield is developing next door to it.
It’s going to be a massive scheme - at 1.9m sq ft bigger even than Westfield’s other scheme in west London - but is well advanced in terms of construction, as is the stadium and the very eye catching aquatic centre next door. Lettings haven’t really kicked off yet, apart from the anchors M&S, John Lewis and Waitrose, and that’s where Westfield now have to really get moving.
They’ve not been helped by the caution of retailers when it comes to signing new deals, nor by their newly emboldened stance on terms - the story doing the rounds at the moment goes that Philip Green kicked Westfield out of his office when they refused to grant him the same terms as John Lewis, which must have been an amusing scene.
But that sort of negotiation is what business is all about and neither retailers nor landlords are shrinking violets. In the end all the big retailers will end up going in there. Stratford is going to be where it’s at in 2012, and because it lies bang in between the stations and the stadium, it’s going to be at the heart of the Olympic excitement. But it’s not just about the games - the east of London and the Home Counties around it aren’t well served with retail and with it’s very good transport links Stratford could well become a destination of choice for people in that area.
The picture is of me and Westfield’s Michael Gutman, John Burton and Laura Passam stood on top of part of the centre, having climbed some wobbly metal stairs to get there
. Originally they were going to be building offices and flats on top but the recession has put paid to that, so instead they’re going to be renting it to a US TV station to use as it’s studio for the Games. It’s going to be one hell of a vantage point.
