With an almost unrivalled shopping line-up, Glasgow is ranked as the UK’s number two shopping location. But as Ben Cooper discovers, that hasn’t deterred developers from adding more space

Sometimes extending a shopping centre is a way to rejuvenate a city’s flagging retail offer. At other times it is more a case of fine-tuning. In Glasgow, which ranks second in Retail Week’s Top Towns table, the imminent overhaul of two of the major schemes is certainly more a case of the latter.

With a wealth of shops and a catchment that includes a huge chunk of the centre of Scotland, Glasgow retailing is anything but weak. The city’s main shopping hub sits over the famous Z-shaped pattern of Sauchiehall Street, Buchanan Street and Argyle Street, which includes two of its biggest shopping centres as well as House of Fraser, Debenhams, John Lewis and Marks & Spencer. And elsewhere in Glasgow there are a host of smaller centres, independent retailers and well-established out-of-town schemes.

But holding onto the exalted number two position isn’t something that happens by accident and it certainly isn’t to be taken for granted. To this end, the two big shopping centres within the Z – Buchanan Galleries and St Enoch – are both set for revamps, which their landlords hope will keep shoppers in the city centre and coming to both schemes.

The list of retailers with stores in Glasgow is so extensive it’s almost easier to say which ones don’t have a presence there, rather than which do. On Buchanan Street alone there are no less than 50 well-known retail names including Karen Millen, Diesel, All Saints, The White Company, House of Fraser, Apple, Topshop, Topman and Dorothy Perkins.

Also sitting on Buchanan Street is Princes Square shopping centre – a destination in its own right, with retailers such as Reiss Womenswear, Kurt Geiger, Vivienne Westwood, Moda In Pelle and Whistles under its roof.

Turning to the two big schemes at either end of Buchanan Street, the retail offer is just as impressive. The stronger of the two, Buchanan Galleries, is anchored by John Lewis and Next and has among its 90 other retailers some impressive names, including H&M, Gap, Next and Oasis.

With such a strong set of shops and a catchment to suit, there’s not much danger that Glasgow’s city centre is going to be hit too hard by any of its out-of-town competition, including Silverburn, which opened last year. But when you’re second in the league table, it’s far easier to fall down than it is to creep up and maintaining this privileged position is important both for Glasgow and its retailers.

This is why both St Enoch’s owner Ivanhoe Cambridge and the Buchanan Partnership – a joint venture between Land Securities and Henderson – are investing so much in keeping the appeal of their respective schemes alive. For Ivanhoe Cambridge the biggest coup to come out of the£100m St Enoch extension was the signing this week of H&M to a 32,000 sq ft (2,970 sq m) store. To have the desirable fashion retailer signed up was one of Ivanhoe’s main aims for St Enoch when it bought the scheme in 2005. Ivanhoe vice-president of leasing for Europe Richard Kingston explains: “When we bought the centre our two strategies were to improve the tenant mix and refurbish the centre. H&M was a retailer that we’d always targeted.”

Game for change

Boots is also raising its game as a result of the works, with an extension to its store at St Enoch after 18 years of trading. With this deal and the signing of G-Star already completed, the St Enoch extension is on the way to opening amid much fanfare.

Kingston says the extension works will mean the centre’s footprint will exceed the 1 million sq ft (92,900 sq m) mark and bring in a host of fresh brands to a scheme that was looking tired. He says: “It’s always traded well but the previous owners slowly let the centre go down and the tenant mix started going down. A lot of the centre was dated. We’re trying to change its perception as an old shopping centre to a brand new mall.”

Despite the positive noises coming from Ivanhoe Cambridge, the fact that it is opening an extension in this punishing climate can’t be ignored. Letting a unit to H&M is clearly a coup, but there is still plenty of space to be let, which Gunn property director Stephen Gunn says will be easier said than done. “It’s a difficult market to do deals in. I’ve found that retailers are leaving it later and later to sign. They are much more cautious and they’re waiting to see who else is there. I think they will come, but there will be a flurry at the end,” he says.

Henderson’s push to update Buchanan Galleries is further down the line, but is equally crucial for the developer to get right. While progress isn’t advanced lettings-wise, it is obvious that the Buchanan Partnership is going for the biggest names it can get. It hopes the first of these will be M&S, with which the developer is in talks over a possible signing. A lot now hinges on whether the retailer is willing to uproot itself from Sauchiehall Street and move to the extended centre.

Ivanhoe has been luckier than the Buchanan Partnership, simply in terms of timing. The general opinion of today’s development market is that if you’re already on site then things should be going to plan, especially in a case like St Enoch, where the extension’s opening date is so close. The danger is where a developer has permission and has set a timetable, but has not yet started the works.

Unfortunately this is the state Henderson and Land Securities find themselves in with Buchanan Galleries. Originally, the date the partnership set for completion was 2011. But with the first bit of ground yet to be broken, this isn’t going to be the case. According to Henderson, work will get underway at the end of 2010 and be complete in 2013 or 2014.

But Land Securities development director Nick Davies says that the key is the long-term impact on the Z and on Glasgow. “This is about strengthening the centre and the city,” he says. “It’s creating a destination in the city centre. We’re creating some large units that aren’t on Buchanan Street and we will be attracting some strong fashion retailers.”

In short, Glasgow is enjoying a tweaking phase. An already superior retail destination with a wealth of shopping and shoppers, two of the most vital squares on the board are being subtly rejigged. True, the second of the two projects, Buchanan Galleries, is going to be behind schedule, but ultimately Glasgow’s retail offer is being maintained.

Buchanan Street already has two very powerful poles in the form of Buchanan Galleries to the north end and St Enoch to the south. What these two projects will do is distil these schemes’ influence on shopping habits in the city.

However, with Buchanan Street proving such a powerful trap for shoppers and sealed either end by the two major centres, Sauchiehall Street – located to the west of Buchanan Galleries – could suffer.

In fact, Cushman & Wakefield director Stuart Moncur goes as far as to say there is a danger that the only truly prime pitch left will be Buchanan Street itself, especially if the Buchanan Partnership succeeds in luring M&S away from Sauchiehall Street.

“With the way the market is at the moment you’ve got to question whether the demand is there for all the new space and I think the simple answer is no,” he says. “What it will do is bolster Glasgow’s position in the UK, but it will be to the detriment of the tertiary retail offer. If M&S comes off Sauchiehall Street to relocate to Buchanan Galleries, Sauchiehall Street could really struggle. It’s going down the discount route and it is shrinking.”

Glasgow is undoubtedly going to remain a formidable retail city, but if the recent development does have the effect many suggest, its famous Z might just become a famous L. The shape of the city is changing and in a few years time the retail scene outside the prime location might be feeling the pinch. As such, it looks like the whole of Glasgow will be keenly following the success the Buchanan Partnership has in wooing tenants in the tough years ahead.

Since we last visited

In Aberdeen, Hammerson is preparing for an autumn opening of its Union Square scheme (pictured) in the city centre. The 700,000 sq ft (65,030 sq m) development will include 525,000 sq ft (48,770 sq m) of retail space over 56 new units. Among retailers signed up are H&M, Next, Clarks, New Look and Dorothy Perkins.

Henderson is awaiting planning permission for a major project to redevelop its St James shopping centre in Edinburgh. If plans are approved the developer will begin preparations to deliver the scheme, demolishing all of the existing space, apart from the John Lewis department store. It is due for completion at the end of 2014.

In October a£130m extension to the Almondvale shopping centre in Livingston opened its doors. The 375,000 sq ft (34,840 sq m) of extra space, known as Elements Square, has attracted Debenhams and Marks & Spencer to the scheme, which is owned by Land Securities. River Island, Jane Norman, H&M and Dorothy Perkins have also taken space in the extension.