A £50 million extension to Dundee’s Overgate remains firmly on ice despite centre owners Land Securities enjoying a sales boost in its Scottish shopping centres over the festive period.
The company said trading at its five Scottish centres had been “resilient” in the third quarter despite the high street downturn.
The firm said its Scottish portfolio which includes the Bon Accord and St Nicholas centres in Aberdeen, The Centre in Livingston, and Glasgow’s Buchanan Galleries had seen a 4% rise in sales during the critical Christmas period.
The performance comes amid serious gloom for the high street following the failure of Jessops, HMV and Blockbuster.
However, the strong trading is not going to translate into an immediate boost for Dundee as Land Securities said it had no immediate plans to progress with a £50m extension to the Overgate. The company renewed permissions last year for the addition of a new wing to the sector comprising a further 40 retail units.
Despite a “welcome performance” from the centre in the festive period, Overgate manager David Carson said there are “no plans in the pipeline” to build the extra wing.
“Last year we took the decision to maintain an existing planning permission submitted by the previous owners that allowed us to keep our options open regarding an extension to Overgate,” he said.
“We are very pleased with the centre and its retailers over the festive period in what are challenging conditions for the high street. However, we do not have plans to further develop in the short term,” he said.
Mr Carson said the focus remains to ensure the Overgate continues to perform as well as possible for its current retailers throughout this year.
Land Securities said its strongholds north of the border were “thriving” courtesy of “high retention levels and below-average void rates” from its retail tenants.
Although its third-quarter results show little evidence of a let-up in the pressure on consumers and the challenges for retailers, the group said there continues to be demand for space in the right locations as retailers respond to the growth of multi-channel retailing and the evolution of consumer shopping habits.
The group is launching its new Buchanan Street development in Glasgow in March as a result.
Land Securities chief executive Rob Noel said: “Retail is not dead. Retail is changing.”
l The deteriorating state of high street retail looks set to be compounded by staff cuts at 50% of firms before the end of March.
The number of shops slumped by almost 600 last month, even before the recent collapse of a raft of high street names, according to the latest Retail Employment Monitor carried out by the BRC.
Surveyed in conjunction with Bond Pearce, the quarterly BRC results did reveal a 0.6% increase in retail employment during the final month of the year to cope with the Christmas rush.
But retailers’ employment intentions have now deteriorated significantly year-on-year, with only 4% set to increase staffing levels before April.
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