COUNCIL BACKED INVESTMENT MODEL TO DRIVE FORWARD MAJOR MIXED USE CITY CENTRE SCHEME FOR SHEFFIELD
Monday 9th April 2018
Sheffield City Council and its strategic development partner, Queensberry, has today announced that the Council will commit as investor to drive forward proposals to complete its transformative city centre regeneration scheme, formerly known as the Sheffield Retail Quarter.
If approved at a Cabinet meeting on 21 March, the Council will act as the primary development investor to bring forward 1.5 million square feet of new retail, leisure, Grade A office and residential space right in the heart of the city centre. The new city centre commercial and residential district will enhance Sheffield’s ability to attract business, professional and financial service sector jobs and investment, and to reclaim retail spend that currently leaks out of the city.The scheme's new working title, Heart of the City II, reflects a move away from a pure retail to a mixed-use project with a greater focus on high quality residential and office space. It also builds on the neighbouring original Heart of the City regeneration scheme that completed after the millennium.
Heart of the City II, designed by Leonard Design Architects, will feature significant levels of Grade A office space and residential development. This will create a prime new business and lifestyle destination, which will help generate the footfall and spending power that is key to drive the retail and leisure elements of the scheme, including restaurants, cafés and a new contemporary food hall.
Retail will primarily focus on premium operators not already in the city centre. Two 4 or 5-star hotels will also feature, alongside new public squares that will continue Sheffield’s reputation for high quality public realm. The new investment model follows the successful delivery of a 140,000 square feet Grade A office building for HSBC with over 60,000 square feet of retail space on the ground floor. Effectively forming Phase One of the scheme, the development is on site and on-track for completion in 2019. HSBC have agreed a 15-year lease and a first major retail let is expected to be announced soon.
Cllr Mazher Iqbal, Cabinet Member for Business and Investment at Sheffield City Council, said:
I am delighted to see these new plans come forward which will make such a lasting impact on Sheffield’s retail, leisure and entertainment offer. We believe that these re-shaped and exciting plans position Sheffield brilliantly to deliver an individual and unique scheme that reflects the different ways in which people shop, live and socialise. We are seeing schemes come forward across the city and more and more people choosing to live, work and study here. Our entertainment offer after 5pm is thriving. These new plans will see a truly innovative city centre emerging that reflects Sheffield’s changing dynamic."
We are in exciting talks with major retailers but this is only part of the picture – delivering leisure, entertainment and tourism offers that complement them is what Heart of the City II is all about. The scheme has evolved to deliver not just a retail quarter but a new city centre mixed-use, vibrant quarter right in the heart of our city. Our commitment to the scheme is already demonstrated by the ongoing construction of HSBC's impressive new office development and accompanying retail and leisure units. These plans will maintain the momentum we have achieved, create thousands of jobs and place Sheffield firmly in the premier league of UK cities."
Paul Sargent, Chief Executive and Co-Founder of Queensberry, said:
In the post-Brexit market place, it is really encouraging to see proactive local authorities like Sheffield City Council taking their economic success back in to their own hands. They are driving forward regeneration in the short term that will kick start much needed private sector activity in the medium term. We have been working closely with Sheffield City Council for nearly two years now to develop a masterplan that will create a renewed focus for the centre, that combines the best of the old with new buildings and enhanced public realm. This is a key milestone and a significant step forward in this process, which will provide a transformational mixed use development and place the city at the forefront of urban place making."
Under the new delivery plan, the next phase of three new blocks will be submitted for planning in early summer 2018, with public consultation beginning in April. Construction on the next phase is expected to begin towards the end of 2018.The Council will initially fund each phase of delivery, with Queensberry providing the design, delivery and lettings expertise. The Council will then either retain phases of the scheme to maintain a long-term income stream from rental, business rates and council tax, or it may dispose of some or all of the scheme on the open market as appropriate, effectively de-risking the development for private sector investors.
The new model is part of a strategy to speed up delivery and retain control of a scheme that has seen significant delays over a number of years after a previous scheme backed by Hammerson didn’t progress in the wake of the financial crisis of 2007.
Following comments received during the 2015 public consultation, Heart of the City II will see existing street patterns retained rather than the demolition and creation of new streets as previously planned. This will also see the current John Lewis store remain in its existing location, which it has occupied since 1963 as a key focal point of the city on Barker's Pool. Again, this will facilitate speed of delivery of the scheme.
Completion of Heart of the City II is expected to create around 500 construction jobs and the scheme should support between 5,500 and 7,000 jobs once built. It will also stimulate further development within the city centre and attract additional inward investment into Sheffield.