Meadowhall signs new names to cash in on affluent shoppers

The Sheffield-based shopping centre’s part owner British Land said it is increasing the proportion of premium retailers in a bid to attract more affluent shoppers.

British Land’s chief executive Chris Grigg said: “The retail landscape in the UK is going through a period of fundamental change.

“Consumers are becoming increasingly sophisticated and demanding. They want more choice, greater convenience and better value along with a much better shopping experience.”

British Land has completed a £7m major redevelopment of Meadowhall’s Oasis food court, adding seven new restaurants including Giraffe, Carluccio’s and Chao Baby.

“Improving the retail environment by increasing leisure and food on our schemes was a key aim during the year,” said Mr Grigg.

He was speaking yesterday as British Land reported a 5.1 per cent rise in underlying profits to £269m for the year to March 31, helped by 5.4 per cent growth in net rental income.

The company said demand for its retail space remains robust despite faltering consumer confidence.

The group’s retail occupancy rate was broadly unchanged at 98.3 per cent and occupiers in administration represented 0.6 per cent of its total rent bill at the end of March, although this will rise to one per cent because of the failure of Clinton Cards.

Footfall at its retail locations increased 0.3 per cent on a year ago as the company said it benefited from the trend for retailers to focus their store portfolios on locations where they are best able to serve their customers.

British Land highlighted its strong relationships with major fashion retailers after multiple deals with chains including Next, Marks & Spencer and H&M.

It has also signed a deal with Asda for three new stores in Leeds, Woking and Stafford.

Mr Grigg said prospects are clouded by the outcome of the euro crisis, but he said that key trends still favour the business.

“Given the ongoing shortage of quality space in both offices and retail, we believe there are further opportunities to create value and we are investing in expanding our future development pipeline.”

The group said the retail market had a more difficult year, particularly so in the second half as consumer confidence was hit by the twin impacts of austerity at home and the debt crisis in Europe and which led to a marked increased in the rate of retailer failures.

Although rental values across the market fell by 0.4 per cent in the year, British Land said prime rental values continue to grow.

The group recently applied for a new 52,000 sq ft retail-led development on the land adjoining Meadowhall.

The extension could help turn the centre into one of the UK’s top five shopping destinations. Swedish furniture giant IKEA has expressed an interest in becoming a key retailer at the new site.

There was no news yesterday on the sale of half of British Land’s 50 per cent stake in Meadowhall.

A Norwegian fund is understood to be front-runner to buy the 75 per cent of Meadowhall that has been put up for sale for £1.2bn.

Norges Bank Investment Management is thought to be closing in on a deal.

Retaining half its stake would allow British Land to retain management of the centre.

The other 50 per cent of Meadowhall is being sold by London & Stamford.

The 21 year-old shopping centre could also attract the attention of sovereign wealth funds, Singapore investors and Malaysian and Canadian pension funds.

Meadowhall currently has 10 anchor stores, including Debenhams and House of Fraser.