With Crossrail regeneration well underway, fashion is gaining a foothold on the east end of Oxford Street.
Just four months after plans to re-energise the eastern end of Oxford Street were unveiled, green shoots are already starting to appear.
Back in November, not-for-profit organisation New West End Company (NWEC), which represents businesses in the area, predicted that “fashion would be king” of the Tottenham Court Road end of the retail thoroughfare, with others piggybacking on the success of Primark, which had opened just weeks before, in seeking to benefit from the Crossrail development.
In fact, in the year to February 2013, rental rates at this end of Oxford Street have increased 40%.
A report published this week, commissioned by the NWEC and Heart of London Business Alliance and written by property firm Jones Lang LaSalle, says recent transactions have established a higher range of £350 to £380 per sq ft.
Although the average rent is “still considerably below prime” - space around Oxford Circus averages £800 per sq ft, while parts of Bond Street can command rates as high as £1,250 per sq ft - this is rapid growth for the area and contributes to the city-wide rental growth (see infographic).
Guy Grainger, UK chief executive for Jones Lang LaSalle and writer of the report, believes this area of Oxford Street is “making up for lost time”.
“It has been an unattractive shopping environment for many years, and now it’s attracting a different type of customer - and one that is different to the other end of Oxford Street,” he says.
NWEC chief executive Richard Dickinson agrees. “Oxford Street east has been blighted for 15 or 20 years because of a lack of assurance on its regeneration but now we have that clarity it is totally changing the landscape,” he says. “The success of Primark as an anchor store has made others sit up and pay attention.”
NWEC is hoping the area will be dedicated to young fashion brands and retailers, with Dickinson citing local universities and new office developments towards Holborn and Camden as underpinning growth in 20 to 30-year-old customers. Grainger agrees the local workforce plays a much larger role in the consumer make-up of the east side of the street, and could therefore see a tenant mix emerge that is ‘reflective’ of that.
David Atcherley-Symes, retail leasing director at Land Securities - which alongside Frogmore managed the Primark development - says the area is now at a tipping point in which retailers are approaching property holders.
“Before, retailers didn’t want to go much beyond M&S, but Primark has created a book end, so they can fill in the gaps rather than acting like a pioneer,” he says. “Primark has lifted the area to become a fashion destination.”
Atcherley-Symes says he is talking to “a number of other retailers”, both familiar names and those new to the shopping district. Dickinson confirms
a couple of international retailers who currently have no UK presence are looking at it very seriously.
They will follow in the footsteps of US casualwear brand J Crew, H&M’s sister fascia & Other Stories and Australian labels Hollister and Gilly Hicks, who have recently taken units in Regent Street. But Atcherley-Symes says the eastern end lends itself to “more edgy” businesses.
One of the final pieces in the jigsaw will be who takes on the HMV space and Atcherley-Symes is convinced it will be a fashion retailer. “That is when the east side will take one step further,” he says.