Sheffield Council takes troubled shopping development into its own hands

Sheffield Council will spend £55m purchasing the remaining properties in a key area of the city centre between Pinstone Street, Moorhead and Barkers Pool. Some of the buildings had already been purchased by developer Hammerson, which had planned the doomed Sevenstone shopping scheme, shelved last year following lengthy delays.

The new £300m plan, which will create 2,500 jobs, will see the area transformed on a ‘block-by block’ basis, in contrast to original plans for a covered mall.

Interest has already been shown by 24 developers and work could start on site in 2016, with the first phase complete by 2019. Next month the council’s Cabinet will finalise structuring the property deal, which could include finding investors or funding the scheme directly. A decision on the preferred developer is planned for September.

The council’s director of capital and major projects, Nalin Seneviratne, said terminating the agreement with Hammersons allowed them to take a fresh look at the scheme in a changing retail environment.

He said: “We want to ensure that when we come to market we have something that is financially viable, profitable and meets the demands of the retail market.”

It will be designed to ensure continuity to existing city centre shops, like those where the new £18m Moor Market, which has come under heavy criticism amid low visitor numbers, is situated.

Mick Cull, chairman of the Sheffield branch of National Market Traders Federation, said: “After years of thinking Sevenstone was dead in the water, this is excellent news. But we could have a building site on our doorstep for the next four or five years, so the council needs to ensure that existing business in the city are looked after while the development work goes ahead.”

The scheme will also link to independent retailers on Division Street and existing stores on Fargate, and aims to ensure millions of pounds of shoppers’ cash stays in South Yorkshire.

Independent research showed that Sheffield was “leaking in excess of £70m” in spend outside the city centre region, to places like Manchester and Nottingham, Mr Seneviratne said.

He said: “This scheme will be bringing that spend back into the city, not only for the benefit of this scheme but Fargate, The Moor and Division Street.”

Businesses affected by the compulsory purchase will be given the option to stay in place to ensure the area remains attractive to shoppers during the transition.

The Sheffield John Lewis store lies within the compulsory purchase zone, but the council will not be buying it as it remains “key” to the scheme, Mr Seneviratne said.

“Whether it is in its existing store or a new store remains to be sorted,” he said.

A spokesperson for the retail giant said its focus was working with the council “to find a long term solution for John Lewis Sheffield.”

It is hoped the development will allow Sheffield to compete with other Yorkshire cities, like Leeds, which last month saw its new Trinity Leeds shopping centre mark 22m visitors in its first year.

Coun Ben Curran, cabinet member for finance and resources said the investment of “hundreds of millions of pounds into the city” would be a massive boost to the city centre’s retail offer.

He added: ”The city centre needs a high-class regional shopping facility to compete with the likes of Manchester, Leeds and Nottingham. This will enhance the status of the city itself and in turn stimulate office, commercial and leisure opportunities in the city centre.”

Sheffield Chamber of Commerce executive director Richard Wright said it was “absolutely delighted” to see the project move forward.

He added: “It is a critical development for the city and we applaud the extremely positive message this sends and the ambitious timescale it lays out.

“We are hoping to see something distinctive, world leading and fit for purpose in 15 years ahead.”