JUST TWO months after Top Shop announced its surprise exit from Drogheda's Scotch Hall shopping centre, another major retailer has decided to hand back the keys after less than three years of trade at the centre. Gretchen Friemannreports.
Pull and Bear, a leading label in the Inditex group, which also owns Zara, has put its lease on the market after its sales figures fell far short of expectations.
Like Top Shop, Pull and Bear is targeted towards younger shoppers and the loss of this second important retailer may deal a heavy blow to the centre's reputation as a leading fashion destination.
The Spanish brand's lease on the 250sq m (2,691sq ft) unit is available by assignment from the retailer's UK property agent, Harper Denis Hobbs, and at this stage the firm has ruled out offering any incentives to precipitate a quick sale. The annual rent is €212,000 and there is a 15-year break option in the standard 25-year contract. Pull and Bear will continue to trade out of the first-floor store until a deal has been done.
Top Shop on the other hand has made it clear that it's open to discussion on incentives and has already offered a year's free rent to traders prepared to take over its 25-year lease, which carries an annual rent of €330,000.
So far, the UK brand, which is part of the Arcadia Group, has failed to find a suitable retailer and the store remains open. Arcadia, one of the UK and Ireland's leading fashion corporations, has four other shops at Scotch Hall, with Evans, Wallis, Dorothy Perkins and Burtons all trading there, but Top Shop's 692sq m (7,449sq ft) store ranks as the group's largest and most high-profile unit at the centre.
The high-street label has pursued an aggressive growth strategy in Ireland over the past few years so its decision to sell up at Scotch Hall came as a shock to many in the industry. However, retail sources claim that first-floor trade at the €200 million centre has been patchy since its opening in 2005. According to one agent, trade on the ground floor, where anchor tenant Dunnes Stores is located, is consistently strong but "people are just not moving upstairs to the fashion retailers. That may be because they don't have the money or it could be because the centre is not appealing to younger shoppers."
Another source pointed out that Drogheda was one of those regional towns at risk of being "over-shopped". He questioned whether its population could sustain two large-scale retail developments when there were already massive shopping centres within a short drive of the town. He also pointed out that the pedestrianisation of West Street, Drogheda's main high street, had boosted footfall in the town centre.
Yet Scotch Hall is not the only shopping centre to be feeling the pinch of a radically different trading climate. It has also emerged that Champion Sports has decided to sell its lease at Drogheda's second major retail development, the Laurence Town Centre, where Marks Spencer and Shaws are the main anchors. The mall, which opened in 2006, still has a large number of vacant shops.
According to Nigel Kingston of Douglas Newman Good, the property agency responsible for the lettings at Scotch Hall, Drogheda's problems are not unique and he claimed that footfall levels were "declining in most shopping centres around the country".
And as the economic gloom deepens, there is a growing consensus in the industry that vacancy rates in many retail developments could be on the way up.
Despite this latest setback, however, Scotch Hall's developer Gerry Barrett of Edward Holdings, is pressing on with the construction of phase two at the centre, which could extend to 43,000sq m (462,848sq ft) of commercial space and will cost €200 million.
In addition to a broader range of shopping facilities, the next phase will also include a 1,500-seat multiplex cinema, restaurants and an extension to the D Hotel which opened at the same time as the shopping centre.
