Major city retail plan hinges on Treasury go ahead

Developer Hammerson said talks are ongoing with Sheffield City Council about the revised design, which is to be scaled back to enable the project to go ahead.

Millions of pounds has already been spent on planning and designing the new retail quarter and the old fire service headquarters on Wellington Street has also been demolished.

Sheffield Council is hoping to borrow 10m and also access a grant worth 9.57m from regional development agency Yorkshire Forward – a grant which must be approved by the Treasury.

The grant was suspended by the Government earlier this year but it is expected to make a decision about whether to go ahead with it in the autumn.

The money would allow it to complete compulsory orders (CPOs) for land earmarked for the scheme, which would have John Lewis as its anchor tenant.

The CPOs must be completed by July 2011 or they will expire but the council said it remains confident they will go ahead in time.

A Hammerson spokeswoman said: "We are working with Sheffield City Council, key city stakeholders and prospective retailers interested in Sevenstone on redesigning and improving the scheme in line with the current climate and better match the requirements of all stakeholders.

"This will ensure that we can substantially improve the shopping experience within the city and create a viable and deliverable scheme."

Earlier this month, Hammerson said it planned to bring forward amended plans for Eastgate Quarters in Leeds, which includes Marks & Spencer and John Lewis as anchor tenants.

It said the scheme, which could create 4,000 jobs, is due to be submitted later this year as the property market shows tentative signs of recovery.

Construction was initially scheduled for completion in 2012, but work stalled due to the recession.

Hammerson said the scheme review revealed a strong demand for "aspirational fashion" aimed at young people.

The revised plans are also expected to include a catering quarter, offering everything from snacks to evening dining.

Meanwhile, construction at the Trinity Leeds quarter in Leeds city centre has also resumed after Laing O'Rourke was appointed principal contractor for the 1m sq ft scheme.

At its peak, up to 1,000 construction workers will be on site and, once completed, Trinity Leeds will employ about 3,000 retail-related positions. It is already 47 per cent pre-let or in solicitors' hands.

Trinity Walk in Wakefield was the first shopping centre in the region to resume work following the recession. The 180m complex in the city centre has created more than 300 construction jobs and should be completed next year.

AMBITIOUS PROJECT

Original plans for the Sevenstone retail quarter included 110 shops, 232 homes and up to 2,200 parking spaces in an area between Barker's Pool and Moorhead in Sheffield.

A new John Lewis department store to replace the existing store in Barker's Pool is due to be built on the site of the old fire station HQ.

Earlier this month, Hammerson, which also owns the Bullring shopping centre in Birmingham and the Brent Cross shopping centre in London, said its markets continued to recover from recession after lower vacancy levels and growing income helped its half-year profits to rise seven per cent.