Central London retail space is forecast to increase by 8% by 2020, with the current retail development pipeline around the seven new Central London Crossrail stationstotalling c.2.3 million sq ft.This comprises 40 schemes and is the equivalent of 1,000 standard retail units or four Selfridges stores.
Knight Frank’s analysis of theCentral London retail development pipeline shows that the arrival of seven new Crossrail stations will substantially change the capital’s retail landscape. In particular, the new station atTottenham Court Road is set to transform the eastern end of Oxford Street, by attracting a growing number of international brands to the area. One of the best examples is Zara, which is set to open one of its largest UK flagship stores at 61-69 Oxford Street in 2015.
Traditionally, this area has been occupied by smaller, independent retailers which did not cater for international shoppers. However, Primark’s arrival in 2013 and Zara’s expected opening in 2015 demonstrate the extent to which the location is being transformed as a result of new infrastructure.
Oxford Street itself currently has nine schemes over 20,000 sq ft in the pipeline. Up to 450,000 sq ft of new or redeveloped space is expected by 2018 and, with Crossrail providing direct access to the West End’s main shopping thoroughfares, millions of potential extra shoppers will now have quick and easy access to London’s retail core.
Canary Wharf will also entrench its position as a burgeoningshopping destination, asit undergoesone of its largest retail expansions to date. With the combined retail offers of the Jubilee Place extension and Crossrail station, retail provision is set to grow by nearly 160,000 sq ft. This will establish Canary Wharf as a unique shopping and leisure experience, with the new tenant line-up in 2015 to include an Everyman Cinema and Poncho 8, as well as aspirational brands Barbour International, Banana Republic, COS and MAC which haveall recently opened in the Jubilee Place extension. These will, for the first time, service weekend shoppers, families, tourists and local residents.
The ‘Shoreditchification’ of Shoreditch is also set to enter a new phase, with greater concentration around the Overground station leading to more opportunities for larger mass market retailers. Developers have acknowledged the potential of the numerous brownfield sites surrounding Shoreditch High Street station and have created an unprecedented construction boom in the area. The recently completed 25-storey Avant-Garde Tower, with its 37,000 sq ft of retail space, is the first of a number of expected schemes. Presently, there is c.120,000 sq ft of retail space inthe pipeline, with another 250,000 sq ft at the pre-planning stage. Moreover, with several large sites still up for grabs, such as Truman Brewery and the Shoreditch High Street triangle, the area is expected to see more development, particularly south of the station.
Crossrail is not the only infrastructure scheme which is transforming London’s retail landscape. The two-station Northern line extension to Battersea Power Station has released large tracts of underutilised land for development. Knight Frank estimates the overall development pipeline in the areato be 21.2m sq ft. Of this, nearly 1.2m sq ft will be retail space. The largest development in the area will be the multi-phased transformation of the power station, where up to 700,000 sq ft of retail will be developed over the next ten years. Other notable schemes under development include Nine Elms Parkside (c.100,000 sq ft), Embassy Gardens (85,000 sqft) and Riverlight (23,000 sqft).
Chris Babatope, research analyst, Knight Frank, commented, “From Paddington to Canary Wharf in less than 20 minutes, Crossrail is set to drastically change travel across London. Largely on the back of Crossrail, we are seeing a significant increase in retail development, with key retail markets in the West End set to expand outside of traditional boundaries. With the most optimistic forecast suggesting millions of extra visitors to the West End every year, it is expected that there will be substantial increases in footfall, leading to significant rental growth.This will not only boostprime pitches, such as Oxford Street and RegentStreet, but also smaller submarkets further afield, including Seven Dials and Long Acre in Covent Garden.”
Ian Barbour, head of retail leasing, Knight Frank, commented; “Knight Frank continues to see exceptionally strong demand from both international and UK retailers in the fashion, home wares and food and beverage sectors.We believe that these pipeline developments will provide new space which meets users’ optimum size criteria. This is likely to strengthen the attraction of the core development hubs around Tottenham Court Road/Eastern Oxford Street and Canary Wharf/Wood Wharf.”
