Look north
Published: 05 November, 2007
If all the plans being assembled for the O'Connell Street and Henry Street areas of north central Dublin city come to pass, in 10 years time the area will be scarcely recognisable from how it looks today.
The first big new scheme off the block is Arnotts' plan for its Northern Quarter, which will involve total regeneration of much of the land between Middle Abbey Street and Henry Street, some of which is occupied by Arnotts' present department store.
The scheme, covering just over 150,000 sq m, includes 47 new retail units, 17 new cafés, restaurants and bars, 189 apartments and a 152-bedroom four star hotel. It also includes a new plaza, between Henry Street and Middle Abbey, and will turn Prince's Street North, beside the GPO, into a major shopping street. A new pedestrian route is also proposed, from Henry Street, through the existing GPO Arcade, across Prince's Street North and into Middle Abbey Street.
Initial estimates put the cost of the development at €750m, but reliable sources close to the project now say that the final bill could be up to €1bn, perhaps even more.
In recent months, several major changes have been made to the financial structure of Arnotts, although Nuala Buttner, a spokesperson for the Northern Quarter scheme, says that currently Northern Quarter is 100 per cent owned by Arnotts.
The ownership of Arnotts has also undergone some changes. First of all, the O'Connor family, which had been a stakeholder in Arnotts for 70 years, sold its share of the business for over €40m. Then, Boundary Capital, a recently listed investment company led by financier Niall McFadden, took a major stake in Arnotts. Finally, along came Anglo Irish Bank, whose property fund committed €25m for an 18 per cent stake in Arnotts. The bank has now teamed up with Boundary Capital to make a joint €65m investment in Arnotts, in return for a 46 per cent stake in the retailer.
The plan is that a holding company, Arnotts Holdings Ltd, will acquire 100 per cent of Arnotts and this will give the private clients of Anglo Irish a stake in both the retail and property sides of the Northern Quarter project. The remaining stakeholders in Arnotts Holdings Ltd will be Boundary Capital and the Nesbitt family, led by Arnotts' chairman, Richard Nesbitt. The Northern Quarter development will mean huge bank borrowings and Anglo Irish has committed itself to bankrolling the development costs of the scheme.
When the financial dispositions of the Northern Quarter scheme are completed, the stakeholders, led by the Nesbitt family, will own 80 per cent of the project. The remaining 20 per cent will be allocated to the British urban regeneration specialist Centros Miller. A source close to the project revealed that it is "more or less decided" that Centros Miller will take charge of the project's fulfilment. It's expected that a formal announcement will be made before the end of this year.
Apart from the complex financial arrangements, the main item on the agenda now is the decision by An Bord Pleanala on the project. Initial planning approval was given by Dublin city council last July and the planning appeals board is currently working its way through the objections lodged with it.
But as planning on the scheme isn't yet finalised, changes could be made to the original plan, including a relocation of the Arnotts department store, which runs through from Henry Street to Middle Abbey Street, although Buttner says that at this stage no material changes have been made to the plan. Provided that the An Bord Pleanala decision (expected during the first quarter of 2008) is favourable the backers of the Northern Quarter hope that construction will begin in the last quarter of next year, with completion due in 2012.
Buttner says that very strong interest has already been shown in the scheme by both indigenous and international retailers, with the current credit crunch issues having no obvious impact on its rollout.
If all goes according to plan, the other big scheme intended for this area - the Carlton cinema site in Upper O'Connell Street - will also be close to completion by 2012. The site, most of which is owned by Chartered Land, covers about 2.5 ha and runs from Upper O'Connell Street through to Moore Street.
Several previous attempts have been made to develop this site over the past decade, but it looks as if the Chartered Land project is the one that will become a reality. It'll be an even bigger investment than the Northern Quarter: Dominic Deeny, who runs Chartered Land, says that even at this stage it looks like costing in excess of €1bn.
Deeny is the first to admit that it's going to be a very complex development project but adds that Chartered Land sees it as a highly important site in terms of future development in Dublin. It will help expand the retail offering in the city centre, just as the Northern Quarter scheme is set to do, and Deeny believes that one of the advantages for retailers of the Carlton plan is that it will offer the big floor plates they need in the city centre.
But in keeping with the philosophy of Chartered Land, Carlton will be very much a mixed use scheme, with a high emphasis on civic amenity and a landmark tourist attraction. The company has the backing of Dublin city council, which regards the scheme as essential for completing its regeneration of O'Connell Street. However, it will be a while coming, for Deeny says that planning will take up to two years and if they are successful construction will take a further four. Full completion is scheduled for 2013.
In the meantime, other developments have already enhanced the retail offering in the O'Connell Street/Henry Street area. Clerys department store in O'Connell Street recently completed a major revamp, while in Henry Street the total refit of the ILAC centre is virtually completed, apart from the Moore Mall.
Also in Henry Street, Dunnes Stores' new flagship outlet on Henry Street opened last July, with extensive fashions for men, women and children as well as homeware, all on three floors, as well as the Reflection café/brasserie. In keeping with Dunnes Stores' new signage, the new store is branded simply 'Dunnes'.
Another group that's eyeing up the north city centre is Brown Thomas, which admits it's keeping a very close eye on what's happening there, hoping eventually to open either a branch of Brown Thomas itself or a BT2 store north of the Liffey. But it won't move until it sees how the big schemes already proposed for the area work out. A recent report on Wikipedia that Brown Thomas was going to take space in Clerys during 2007 was wide of the mark, to say the least!
Not far from the city centre, work is well under way on the €850m Point Village project in dockland, which is less than 3 km from O'Connell Street. Construction is already well advanced on the 20, 000 sq m shopping mall, where the ubiquitous Dunnes Stores - which seems to be involved in almost every large Irish retail development these days - is taking 12,000 sq m over three floors.
But while so much is happening to regenerate the north city centre, Tom Coffey, chief executive of the Dublin City Business Association, admits that between the city centre and the American-style malls on the outskirts of Dublin, much has been lost in the suburbs. He says that these US-style shopping centres are merely a conveyor belt for money going out of the city.
"Quite a lot of the older shopping centres in north and west Dublin, dating from the late 1960s, have closed down, as have a lot of smaller shops all over the city. Many petrol stations, too, have closed down because they are worth far more for their property value".
Coffey says that the villages that make up the city of Dublin are in desperate need of redevelopment. Local community life can be revitalised and he adds that bringing in new retail isn't the entire solution. Areas that are close to the north city centre also offer many possibilities for regeneration, he adds, citing the still run-down Mountjoy Square. Coffey believes that one of the big problems in redeveloping Dublin is the lack of joined up thinking by planners and officialdom generally, on such issues as public transport.
But for the next few years at least, much of the development focus in Dublin is going to centre firmly on the north city centre, primarily the area around O'Connell Street. And it is quite clear that much of this regeneration will depend on the successful conclusion of both the Northern Quarter and the Carlton schemes. For the moment, at least, we watch and wait.
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=== north or south? ===
Traditionally the shopping streets south of the Liffey have attracted a more affluent clientele, while those to the north have tended more towards the mass market. This is reflected in rental levels and CBRE calculates that prime shops on Grafton Street, to the south, command rents of E10,000 per sq m zone A, while Henry Street, to the north, commands E7,500.
Claire Quinn of DTZ Sherry FitzGerald is one who believes the old order may be changing: "The arrival of Gap and Swarovski jewellers in recent months underlines the continuing demand for retail space on Henry Street," she says. "Zara, H & M, Gap and now 3 Ireland have opened on Henry Street which has further strengthened the street's profile."
