Developers diving deeper into £600m retail scheme

DEVELOPERS of Sheffield’s delayed £600m retail quarter this week underlined their commitment to getting the scheme off the ground as it was announced they are to increase their investment.

London-based Hammerson is taking up the slack to complete the compulsory purchase programme after Yorkshire Forward, the Government-back development agency, withdrew its offer of £9.5m.

The council decided last year to contribute £10m but, without the extra money to see all the required land and property in ‘friendly’ hands by the end of July, the whole Sevenstone project would have collapsed after ten years’ planning and groundwork.

Hammerson is also agreeing to pay the interest on the council’s borrowing and to repay the £10m once construction has started.

The council has set a target of the financial year 2013/14 for work to start on a development between Barkers Pool, Pinstone Street and Moorhead that will be half the size of Meadowhall. Both the authority and Hammerson have always believed there is the demand in Sheffield for big modern shop units so that the city can compete with the likes of Leeds, Manchester and Nottingham and it has always been envisaged that the retail quarter would be anchored by a new John Lewis department store.

After the hammer blow of the recession, plans are now starting to move again, although their final shape has yet to be confirmed.

According to a report to the council’s cabinet next Wednesday, Hammerson has spent £60m since 2001 on planning and design fees, property acquisitions, moving power cables and gas mains and relocating the fire station from Wellington Street to Eyre Street.

Its latest commitment to compulsory purchase and other costs will add up to £15m.

Hammerson project director Richard Brown said this week: “We have been around the project a long time and have stuck with it. We have spent a lot of time, energy and money to get where we are.”

It had been a difficult period, especially at the start of the recession, he said, but now “green shoots” were emerging and it was time “to take a long hard look at where we are”.

While the concept of blocks of shops and precincts – not an indoor shopping complex – remains the same, some design elements are being reassessed.

Mr Brown said leisure may become a more significant part of the project to reflect market conditions.

However, no indication is being given about the final shape of the new John Lewis. Initially it was intended to open a bigger store on the site of the Fitzwilliam Street fire station, then thinking turned to redeveloping the existing store. All this is now under review.

Mr Brown said there was already “significant interest” in Sevenstone from other retail operators.

Council chief executive John Mothersole said about half the money spent by Sheffield people was outside the city, indicating the need for a top quality retail quarter that would reposition Sheffield on the retail map.

He said he had always been confident of the demand for a major retail scheme. As a result of the latest developments, he added: “I’m much more confident it will happen now within a foreseeable timetable.”