After 25 years of delay, the redevelopment of Sheffield City Centre could finally lead to a modern mix of retail, leisure and workspace
Sheffield’s retail regeneration may be about to bear fruit. In a saga that spans 25 years, its city centre development has undergone multiple rethinks to combat the potential drain on spend from the surrounding cities of Leeds and Manchester, and nearby shopping centre Meadowhall.
Now, as the city’s primary retail area shifts from Fargate in the north to The Moor in the south, Sheffield City Council’s latest development is showing promise. Heart of the City II is a 1.5 million sq ft scheme across eight city blocks. It combines retail with office space, residential, restaurants, two premium hotels and a public space, and has just made its first key signings: H&M group’s young fashion fascias Weekday and Monki. This is welcome progress on the district’s long and controversial path to regeneration, but the quarter-century delay has let other developments steal a march.
The South Yorkshire city’s retail revival dates back to 1994, when a study commissioned by the council outlined the decline of the city centre and recommended a long-term strategy to connect The Moor and Fargate shopping areas with a major new central development. At the time, Fargate was Sheffield’s prime shopping spot, boasting retailers such as Next and New Look.
In 2000, the council created urban regeneration company Sheffield 1, and its city centre masterplan was approved. Shopping centre owner Hammerson was brought on board as developer in 2001, and its £600m retail scheme – called Sevenstone – was finally rubber-stamped in 2006.
What we’re seeing now is a little bit more bespoke and reactive to what is going on in the wider regeneration of city centres
David Fox, Colliers International
The global financial crisis then hit, and Hammerson put the scheme on hold in 2009, before pulling out in July 2013. Five years later, the council unveiled Heart of the City II, in partnership with property developer Queensberry. The project will be completed in eight phases – one per block – concluding in 2024, and is flexible in its design. Currently, it is planned as an equal split between offices, residential and a combination of retail, leisure, and food and beverage (F&B). The first block is nearing completion: anchor tenant HSBC started moving in staff in July, and Weekday and Monki will open their doors this month. The next two blocks are set to include 19,400 sq ft of new retail space at ground level.
While this unfolded, in 2013, the council replaced the city’s historic Castle Markets on the corner of The Moor shopping centre with a new market building on the corner of the development, at a cost of £18m. It passed over control of The Moor to Aberdeen Asset Management the following year, and it has since has attracted retailers whose units at Fargate had become too restrictive.
“Some major retailers, such as Next and Primark, have jumped [from Fargate] to The Moor,” explains Stephen Henderson, director of national retail at real estate services company Savills. “The Moor has attracted some main [high street] players on some quite sensible deals.”
Next opened its new, 42,000 sq ft, store at The Moor in July this year, followed by New Look in the same month. Primark came on the scene in October 2016, and H&M will open its third store in the city at The Moor before the end of 2019, to accompany its two sister brands’ upcoming openings in Heart of the City II.
“Fargate has taken a little bit of a bashing in the current retail climate, but The Moor is probably better placed now than ever,” observes David Fox, retail agency co-head at commercial property agency Colliers International. “It has reinvented itself and has regenerated that end of the city centre.”
Sheffield city centre regeneration
The Moor has not only poached key tenants from Fargate, but also capitalised on the 25-year delay to the city centre’s regeneration, welcoming retailers who were no longer able to wait for Heart of the City II to complete.
However, property experts tell Drapers the delay has resulted in Heart of the City II having a much more “future-proofed” design that matches the current property climate’s mixed-use needs.
Our vision is to create a dynamic and vibrant mixed-use district in the heart of Sheffield
Paul Sargent, Queensberry
“The delay has somewhat played out to the council’s advantage. The original plans for a two-storey mall were very much a child of the early noughties, whereas what we’re seeing now is a little bit more bespoke and reactive to what is going on in the wider regeneration of city centres,” Fox says. “The Heart of the City development has now become a lot more interesting and future-proofed.”
Richard Eyre, head of city centre management at Sheffield City Council, agrees: “In some ways we’re quite fortunate, because if [the original] scheme had gone ahead, it would have been a big retail spaceship that landed.”
Instead, he tells Drapers, the new design is a modern mix between residential, food and beverage, and office space with a reduced focus on retail.
“Our vision is to create a dynamic and vibrant mixed-use district in the heart of Sheffield that will redefine the way people use the city,” explains Queensberry CEO Paul Sargent. “It will combine premium shops with contemporary workspaces, new homes, restaurants, bars and cafes. Sheffield has a potential £9bn spending power from a catchment of 2.6 million people within an hour’s drive, and our ambition is to create a more exclusive and tailored shopping experience compared with Meadowhall and the city’s current high street offer.”
Local traders advocate this new “city centre first” approach, but were critical that the council has previously prioritised out-of-town developments.
“Sheffield City Council has permitted so many out-of-town developments over the last 15 years that it has affected the ability for the city centre to trade effectively,” observes Mark Dransfield, owner of nearby shopping park Fox Valley, located in Stocksbridge. “They’ve effectively managed the decline of the city centre.”
Stuart McAdie, owner of independent retailer The Alternative Store, on Devonshire Street, agrees that “Sheffield never really recovered [from the opening of Meadowhall]”, and that the council should focus on attracting in residents from its direct suburbs before looking further afield.
Sheffield City Council’s Eyre admits: “In the late 1990s and early 2000s, retail in the city centre did take a real knock. We lost House of Fraser [in 1998] and some of our big stores.” However, he is adamant about the city’s recent retail uptick: “Footfall at The Moor is flying – up about 19% year on year.
“We know Fargate and the high street need some drastic work, but we’ve [been shortlisted] for the [government] Future High Streets Fund, and are looking at £25m to transform those areas, increasing the mix of residential, office space and F&B.”
H&M group’s triple signing indicates it has confidence in the city, and head of expansion in the UK and Ireland Moritz Garlich says: “Sheffield has been a really important city for H&M since we first opened our store in Meadowhall shopping centre in 2000,” adding that the new H&M store would be “one of the most exciting” it has launched in recent years.
Savills’ Henderson believes that the new scheme “has got legs”, as long as the retail element is combined with a variety of leisure, lifestyle and workspace destinations.
If Heart of the City II can succeed in its goal to create a 24-hour economy through a mix of retail, residential and office space, it will offer an exciting new hub for residents. The council must keep up the momentum to ensure this iteration is the development that ends 25 years of suspense and delay, and gives Sheffield city centre the destination it deserves.