Retail ParksTo avoid high shopping centre rents, one UK fashion retailer is continuing to move its business to less expensive retail parks. Jack Fagan reports

Leading UK fashion retailer Next is continuing to take advantage of the lower rents in retail parks by expanding into big warehouses rather than high cost shopping centres.

Less than a month after deciding to move down the road from Blanchardstown Town Centre into the significantly cheaper Westend Retail Park, Next has also settled for the Ardkeen Retail Park, currently nearing completion in the affluent south suburbs of Waterford city.

The overall park will have 12,077 sq m (130,000 sq ft) of retail warehousing, parking for 500 cars and a petrol filling station.

Next will be paying in the region of €226 per sq m (€21 per sq ft) for 1,208 sq m (13,000 sq ft) at ground floor level and a mezzanine of 650 sq m (7,000 sq ft). This will allow the multiple to offer a comprehensive range of fashion which is likely to have a broad appeal.

The expectation is that other large multiples may also follow this strategy as a means of reducing overheads when rents in shopping centres are continuing to move up.

Also moving into the Ardkeen Retail Park is Homebase which will operate a DIY and home improvements store of 3,252 sq m (35,000 sq ft). The rent in this case will be €205 per sq m (€19 per sq ft).

Both companies will have the advantage of trading alongside Tesco which has been operating a store of 5,574 sq m (60,000 sq ft) for the past 12 months.

Agent Colliers Jackson-Stops is now marketing the final unit in the park between Tesco and Next. It has a floor area of 1,115 sq m (12,000 sq ft) with potential to add half that space again at mezzanine level. Given the location and prestigious line-up of tenants, the agency expects to secure in excess of €269 per sq m (€25 per sq ft).

In a separate deal, Tesco has recently agreed to rent a petrol filling station on the site which, given its runaway success as a low cost petrol retailer, should ultimately attract thousands of additional motorists to the site.

The Ardkeen Park is being developed by Mr Noel Frisby's company, Frisby Construction, which recently acquired Lisduggan Shopping Centre from Green Property for a figure believed to be around €17 million. Built in the 1970s, Lisduggan is now a dated shopping complex of about 7,432 sq m (80,000 sq ft) on a site of almost 10 acres.

The centre has Tesco and Heatons as anchor tenants and produces around €1 million per annum in rents.

Declan Stone of Colliers Jackson-Stops confirms that plans are being prepared for a major extension and refurbishment of the centre which is trading exceptionally well.