Victoria Gate: What does Hammerson's decision to sell the shopping centre mean for Leeds? - Mark Casci

Anchored by John Lewis, its first store in Leeds and in all likelihood the last it will ever open, the centre is also home to a range of high-end brands including Anthropologie, GANT, Hackett, Joules, Rolex by Prestons, COS and international restaurant group D&D.

A great deal has changed since then and now, with the pandemic having blown a substantial hole in the retail sector.

Months of enforced closure led to consumers increasingly relying on the internet when it came to their spending.

This comes over and above Brexit-related shortages and delays of goods and against a backdrop of city centres nationwide battling to encourage consumers and workers back into cities after a lengthy period of being told by the highest echelons of Government that to do so was unsafe.

Victoria Gate will not have been immune to this and we have now learned that the centre’s owner Hammerson is entering into talks about a potential sale.

Hammerson confirmed to shareholders that it is in talks over a possible disposal of both Victoria Gate and the nearby Victoria Quarter shopping arcades for £120m.

In a statement the firm said: “Hammerson’s strategy remains to realign the portfolio to focus on prime urban estates through disposals of non-core assets, to strengthen the balance sheet, and to recycle capital into its core portfolio and its development pipeline.

“The company confirms that it is in discussions with entities related to Redical Holdings AG on terms for a possible sale of its Victoria Gate and Victoria Quarter shopping centres.

“There can be no certainty that a transaction will take place, but the company confirms the pricing under discussion is £120m, which would represent a class 2 transaction. The company will provide a further announcement if appropriate.”

The key words in all of this jargon-laden statement are “non-core”.

The two centres that have now had a for sale sign placed upon them are among the cleanest and most vibrant retail offerings you are likely to come across anywhere in the country.

As well as Victoria Gate and Victoria Quarter, Hammerson’s other key venues include the Bullring in Birmingham, the Dundrum town centre development in Dublin, Ireland and Les Terrasses du Port in Marseille, France.

If Hammerson’s bosses do not view its Leeds holdings in the same pantheon as these developments then what does that say about the standing of retail in the city?

Hammerson putting the Victorias up for sale is far from an isolated incident.

Let us not forget that John Lewis recently confirmed it was to close its Sheffield and York outlets as part of a round of cost-cutting moves.

While not quite on the same pantheon as the department store, Wilko confirmed a raft of closures in the region earlier this year.

And while the picture is improving, the fact remains that shopping chains were closing stores at a rate as high as two a day in Yorkshire in the first half of last year,

It is important to stress at this stage that putting the centres up for sale does not necessarily mean they will be sold. Given the quality of the two outlets, I would find it surprising if there was not interest from other operators.

But the fact remains that Hammerson will not have made this decision on a whim and one cannot help speculate as to the financial viability of the two centres.

Retail is facing a rapidly changing landscape on a daily basis and more closures by chains are inevitable.

The Victorias are two of the jewels of the crown for Leeds city centre.

Let us hope they remain intact and continue to bolster the city’s offering, and coffers, for years to come.