Flower of Scotland

St James Quarter in Edinburgh is one of the largest retail-led regeneration projects in the UK, which deviates away from traditional box malls and integrates retail, F&B, residential, and hospitality.

The galleria boasts c.79,000 square metres of retail, anchored by John Lewis, with an Everyman boutique cinema, a Bonnie & Wild 1,600 square metre food hall, 67 retail stores and 41 F&B units. The curated mix of brands differentiate St James Quarter from the competition.

Background
Developed by Nuveen, St James Quarter was built on the St James Centre, long considered to be an outdated establishment, unfit for the scale of opportunity Edinburgh presents. The demolition of St James Centre made way for a dynamic, mixed-use development that redefined “shop, dine, play, and stay” in not only Edinburgh, but the entirety of the UK.

Edinburgh’s strong consumer market and status as the second-most visited tourist destination after London created a strong opportunity for a modern mixed-use development that could create a compelling offer to locals and visitors alike.

Today, the scheme welcomes c.20 million visits per annum. The revamping of the original poorly configured and outdated John Lewis store demonstrated the strength of a strong anchor, given the relevance and appeal to the Edinburgh market. Fashion and accessories have a particularly strong presence, showcasing independent brands, high street giants, to high-end brands, ensuring broad appeal.

F&B is equally diverse, with grab & go on the lower ground floor, more upmarket dining on the upper floor, and the hugely successful upscale food hall, Bonnie & Wild. Along the same lines, the leisure provision, made up of an Everyman, Lane7 and Flight Club, cements St James Quarter as more than a shopping destination and again catering to a variety of visitor types.

Indentifying the right brands
St James Quarter was in its crucial leasing phase when the onset of COVID began, leading to a shift in occupier expectations, who were now requesting turnover-based rental structures.

Pragma assessed the potential sales performance and profitability of over 60 target brands across varying sizes and unit locations, taking into account existing representation elsewhere in the city centre and current and future trading dynamics. Particular emphasis was placed on the future trading dynamic on Princes Street and understanding how the once-prime area would pivot toward hospitality and alternative uses. The analysis Pragma provided was crucial in helping determine the appropriate turnover rent percentages, so that deals would benefit both the tenant and the landlord.

Key successes from this project include:

• Emphasising the value of a strong anchor, leading to the revamp of John Lewis, which sees continued success at the site
• Understanding and demonstrating the scale of opportunity, allowing key anchor brands to initially sign (H&M, Zara) and then add sister-brands such as Cos and Bershka due to the strong trading performance
• F&B is thriving across the scheme, with amazing performance witnessed particularly in the lower ground grab & go and the Bonnie & Wild food hall
• The Lane7, with Flight Club as another key leisure anchor, highlights the benefits of competitive socialising on creating a complete day-part profile, attracting a range of users throughout the day.

Evolution
Since its opening, retail has changed constantly, but St James Quarter has secured a prime position through its variety of uses, price points and its creation of a vibrant hub. Development of the tenant mix continues apace, with the W Hotel, opened at the end of 2023, which is likely to increase the volume of affluent visitors to the scheme. Further leisure in the form of Toca – a soccer-inspired, digitally enhanced experience that challenges users to show off their skills – is due to also open shortly.

Opportunities for St James Quarter include:

• Strengthening of the luxury offer, given ties to Multrees Walk and increasing affluent clientele from the W Hotel, potentially elevating the scheme’s level of prestige
• Enhancing the experiential proposition of the site to maintain dynamism and ensure footfall, whether through increasing the commercialised leisure proposition or the implementation of experiential retail elements
• Continual reassessment of retail brand mix to maintain relevancy in a market with constantly evolving consumer wants and needs.
  

Alex Foy